If you can gauge a thing's importance by how - and how much - it's measured, then mobile video is very important indeed right now because it's getting the daylights measured out of it.
The impact of multiscreen streaming video on Internet traffic is pretty well-understood: It's big. For example, according to Cisco's (NASDAQ:CSCO) annual Visual Networking Index, video is expected to make up 80% of all Internet traffic by 2021, up from 67% last year. But what's less understood is consumer use of, interaction with, and attitudes toward said video.
Who are they?
Kind of a central question is just who the users of online video are. The Diffusion Group has taken a crack at answering this and says that users of over-the-top (OTT) subscription VOD (SVOD) services such as Netflix (NASDAQ:NFLX) can be broken down into four non-overlapping groups:
- Pay TV Supplementers use SVOD to complement their TV viewing, not as a substitute or replacement. They make up 34% of overall SVOD users.
- Pay TV Substituters have an aversion toward traditional pay TV and use SVOD for two-thirds of their total video time. They watch SVOD on their PCs and smartphones as well, but spend the most time watching on their TVs. They make up 10% of the total.
- Quantum Viewers are the youngest of the four segments and watch SVOD on all their devices, not just TVs. They're not generally "anti-pay TV," but rather appreciate all forms of video on all their screens. They make up 23% of the total.
- Video Luddites spend the least amount of time watching all types of video on all types of devices, but nonetheless consider online video services as their key source of entertainment. They make up 33% of the total.
What are they watching?
According to Ooyala's "Q1 2017 Global Video Index," for the first time, long-form content represents the majority of time spent watching video on every screen. While short-form video has the greatest chance of being watched in its entirety, long-form content - greater than 20 minutes in length - now represents the majority of time spent watching video across all screen sizes, at 63%.
Ooyala says the change can be attributed mostly to the increasing volume of premium content that services - both OTT and traditional pay TV - are now making available to all devices. As longer content becomes more prevalent, short-form is losing its dominance, particularly as larger mobile screens are now more common.
By device, Ooyala says long-form content now represents the following percentages of all time spent watching video:
- 98% on connected TVs, up from 83% the year before
- 81% on tablets, up from 51% the year before
- 65% on computers, up from 35% a year before
- 55% on smartphones, a 26% increase from Q1 2016
Going beyond just video, according to CDN provider Limelight Networks' (NASDAQ:LLNW) latest "State of Digital Downloads" report, consumers worldwide increasingly use smartphones to access digital content and go online to purchase video games, movies and books.
The annual report indicates that only 14% of respondents still prefer to rent or purchase DVDs of movies and TV shows, and only 25% of respondents prefer hard copies of books or traditional print media. In comparison, 66% of respondents prefer to stream or download TV shows and movies, while 38% of respondents prefer to download books, newspapers and magazines. When it comes to music, 46% of respondents said they prefer to download music over streaming or purchasing a CD.
Limelight's report is based on a survey of 3,500 consumers ranging in age, gender and education in France, Germany, India, Japan, Korea, the UK and the United States.
What are they willing to spend?
According to IBB Consulting's report "Paid OTT Video Services: Research & Insights into Growth Opportunities & Consumer Behaviors," 61% of SVOD subscribers are willing to spend an additional $2 or more to keep their favorite service, and 81% are willing to spend to add a new service that had content they found interesting.
When it comes to finding content, the report indicates that one-third of users prefer browsing and surfing, 24% rely on suggestions from social media, 19% get recommendations online and 13% rely on either in-app recommendations or search tools.
Other findings indicate:
- 51% of paid OTT users subscribe to more than one SVOD service, with 18% paying for three or more.
- Younger demographics, especially millennials, are more likely than any other demographic to subscribe to three or more paid OTT services.
- Based on average SVOD pricing, 61% of SVOD subscribers are willing to pay at least 20% more for their favorite service.
- Interest in live TV is strong, with 47% of paid streamers willing to pay beyond their current subscription costs to add live content.
- Millennials are more likely than any other demographic to be willing to spend on live streaming content.
- 29% of paid OTT video subscribers plan to add an additional paid service within the next six months.
IBB surveyed 1,051 U.S. online consumer adults who subscribe to at least one paid OTT service.
