Uncommon Wisdom

Apr 20 2009   5:42PM GMT

Online viewing: New study points to the issues

Tom Nolle Tom Nolle Profile: Tom Nolle

A new piece of university research shows that TV still has the largest eyeball share by far, and in every demographic group. Online video accounts for only a half-percent of viewing time overall, in fact. Computer video commands less than half the time that console gaming does.

All of this proves that the impact of online video on advertising and TV is indirect and not a matter of stealing eyeballs, as some suggest. We believe that the study validates other material we’ve cited here in the past and shows that the notion that online video advertising is the future of online revenue is, at the very least, far from fulfillment.

This is significant first because it means a lot of startups are probably doomed and YouTube will probably not monetize effectively. More significantly, it means that ad revenue can’t be expected to bolster Internet bandwidth growth, even if we figured out how to flow some of it to the ISPs. Ad revenue loss, partly to online, is indeed a problem for TV, but grabbing online video ads won’t be anyone’s solution.

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