What’s Driving Online Video Growth?

Nielsen and Comscore online video data look like they come from different planets, as ReelSEO points out.    The most dramatic difference is in hours per viewer per month; 4.7 hours for Nielsen as of January 2011 versus 14.2 for Comscore, December 2010.    Yes, both are for U.S.

But there’s another headscratch, aside from how different the numbers are.   Each source tells a totally different story about where the growth in online video is coming from.   Completely different answers to the question:  more users or more usage?

Take these Jan 2011 Nielsen numbers for example.  They seem to say that the audience for online video is saturated and growth comes almost entirely from dramatically more usage from the same people.  I calculated a number from those provided that suggests: growth in time spent comes from more videos per person; not so much from increased time per stream:

Nielsen Online Video Data: January 2011

Now Comscore, for Dec 2010, from their 2010 Digital Year In Review: 

Comscore Online Video Data: December 2010

Granted the measures are apples and oranges.   Still, the Comscore data seems to say that online video users are increasingly dramatically while usage growth is more modest.   A completely different story.

With no bias toward sources or methodologies, the Nielsen growth story is the one I tend to believe.   I would think, at this point in its evolution, most everyone who’s going to watch online videos is already doing so (not counting new users coming in as kids mature).    I would guess that growth is coming from changing behavior among those who’ve already caught the habit.

Clearly there’s tremendous usage upside for online video.   If you think about the higher (Comscore) number for online video consumption, 14.2 hours a month, and compare it to consumption of TV, at some 35 hours a week.   Given that comparison you’d sort of expect usage to be the dynamic driving online video growth.

The question for either story is the detail behind it:  

  • If new users are pouring into online video, as per Comscore, who are those users; what are their demographics or other characteristics?  
  • If the same users are consuming dramatically more streams as per Nielsen, how are there habits changing?   What types of video content are making up the difference?   

And why do both sources show the average length of stream to be so short (both under 5 minutes) and growing relatively modestly compared to the other metrics?  Wouldn’t we expect, given the growth of Netflix, for this measure to be growing dramatically?   

I would love to break this information down into user segments.   Because I would bet there are segments of consumers for whom average length of stream is much longer than the average and segments for whom this metric is growing more sharply than the others.   When those segments start to drive the total sample average, when average length of stream really starts to grow, that’s when disruption of the TV business will be under way.

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