Online Video Viewing Soared In 2009


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The media sector performed well in 2009, recovering $200 billion of value, or 63 percent of what it lost in 2008, online content providers and distributors made up more than half of these gains, according to a new report by consulting firm Oliver Wyman.

The largest gains were in China, where the media sector market value increased by 200 percent. The report indicates that the trend toward online media cannibalizing traditional platforms could push the industry toward a "zero-sum game" and increase the pressure on existing companies to sharpen online strategies.
Online video viewing minutes increased in 2009 by 50% in the U.S. and 30% in Spain, with TV shows and movies accounting for around half of these minutes. "These averages, however, mask the full extent of the change among the subset of the population that watches long-form content online," said Robert C. Fox, a Partner in Oliver Wyman's Communications, Media, and Technology practice.

"In the U.S., for example, among those who watch long-form video online, 15% of their total long-form viewing is online and their linear TV and DVD viewing decreased in 2009. Similarly among all 18-34 year-olds, a key advertising demographic, all forms of viewing other than online and mobile dropped in 2009."

"The pace of growth in online-video viewing is striking," said Mr. Fox. "However, while the platform is still in its infancy, the behavior of today's online population suggests that much of this growth will come at the expense of traditional platforms. Video could be headed for a zero-sum game," he added.

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