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Report: Line between Internet, TV being erased

Wed, 08/13/2008 - 8:20am
Brian Santo

U.S. consumers will spend more than $6 billion for Internet video services by 2013, with direct-to-TV videos accounting for 75 percent of that revenue, according to Parks Associates’ “Internet Video: Direct-to-Consumer Services.”

The trend of moving Web-based content to the TV is facilitated by greater ownership of connected game consoles, networked TVs and alternative video-on-demand (VOD) set-top receivers, which are combining to create growth in user-paid revenues that Parks Associates called significant.

"Consumption of premium Internet video content to date has been low," said Kurt Scherf, vice president and principal analyst at Parks Associates. "Services have been available only on less-than-optimal screens – PCs and portable multimedia players. But new connected products that link to premium Internet video services are emerging at a rapid pace, moving the Internet video viewing experience into the living room. This shift will help grow revenues considerably."

Scherf said the Internet video market is maturing as portals, aggregators, broadcasters, and other content creators and publishers are developing go-to-TV approaches and ad-supported premium video services. Future areas to watch include ad-supported movie streams, new targeted advertising approaches, and Hollywood's efforts to offer more electronically distributed content through download-to-burn kiosks and other manufacturing-on-demand outlets.

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