Friday, July 08, 2011

Is online streaming killing television?

It is that time of year again--moving season in New York. A time of year when young people across the City reevaluate the conditions in which they have been living and determine whether or not it is worth it to stick it out another year or plot a move and take a chance on craigslist or a broker while running around the city with piles of paperwork hoping to be the first person to arrive at a listing.

I have opted to stick it out in my current lease, but the season has made me reflect about different set of conditions, namely Time Warner cable. This is the first time in my life that I have seriously considered forgoing my cable TV, and I think I am finally ready to take the plunge. I realized how rarely I watched any live television anymore. Everything I wanted to watch was on my DVR, and everything on my DVR can be found online. A good internet connection and maybe a Netflix account could finally free me from years of price gauging.

From an advertiser’s perspective, should this be cause for alarm? Not necessarily. An Affective facial tracking study found that online video ads received 18.3% more viewer attention than those found on TV. Not only do you pay more attention to these in-stream video ads, they are also impossible to skip through fast-forwarding. Since the online ads appear at short and infrequent intervals in comparison to TV ads, viewers are less likely to build to step away from their computers, knowing they are likely to miss the content they have been viewing if they do. All of these factors combine to make video ads significantly more effective that than their TV counterparts.

1 comment:

Scott said...

This is a really interesting and important question that plenty of TV execs are fretting over. The quick answer from what I last saw is no. Viewers are definitely spending more time watching content online but in many cases, total content consumption is increasing, so TV watching isn't necessarily going down.

This is probably in part because some networks stagger the times at which they release content online to avoid cannibalization.

But you do bring up a good point - I think that online ads probably are more engaging than their TV counterparts. On top of that, data shows that lots of viewers are on the web while watching TV...which means that if someone came up with a way to serve ads from the same marketer at the same time on both screens, they could be on to something really big.