Growth Rate of Online Video Skyrockets

The trajectory of online video use has been on a hockey stick path for years, but the latest year-end review of 2010 from comScore duly underscores just how firmly the medium has taken hold as a digital mainstay. The comScore 2010 U.S. Digital Year in review finds that the average number of people in our market who watched video online each day skyrocketed 32% to 88.6 million between December 2009 and December 2010. All other key metrics grew as well: number of viewing sessions per person (+13%), hours spent (+12% or 14 hours in December 2010), and number of streams per person (+8%).
Time-shifted TV viewing online continues to be a key driver of these metrics, with both Hulu and individual on-air brands being the main beneficiaries. ComScore finds that in the last quarter of 2010 Hulu accounted for 323 million hours of viewing (+17%, year-over-year) while the combined viewing at the major network sites (ABC, CBS, NBC, Fox, CW) attracted about half of that (162 million hours). But it was the rate of growth among the individual networks that proves most interesting. Direct viewing of TV from the TV brands' own sites had increased at a much higher rate than Hulu, up 82%. In other words, the networks are succeeding in pulling viewers over to their online hubs.
One can imagine how this migration works, although it doesn't necessarily mean a disaffection from Hulu, per se. The fresh and new online brand of Hulu may well have been more appealing and familiar to time-shifting early adopters, who drove the early spikes in Hulu growth. As online video audiences grow to embrace a broader market of viewers who are more familiar with the tried and true TV brands, they may tend to consult the networks online rather than a third party. Or something like that. But clearly the online TV re-viewing habit has taken hold.
The monetization of online video appears to be on a healthy growth curve as well. ComScore has been pushing its argument that online video has an unusually low ad load compared to TV. Ads comprise only 1.6% of all time spent with video (but up from 1.2% in June). But when it comes to overall numbers of total streams viewed, 16.4% of videos are now ad content. This increase in the share of videos comprised of advertising increased substantially just in recent months, from 9.8% in June.
Bottom line: ever so slowly, consumers are starting to treat the Web like a DVR and publishers and advertisers are starting to apply successfully similar business models. -Steve Smith, Media Post
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