Media Analysis

Online video, Netflix poised for big increases

Michelle Clancy| 08 December 2014| 08 December 2014

Online video viewing continues to cross the proverbial chasm into the mainstream with Nielsen saying that online video streaming viewing has rocketed 60% year-over-year in Q3 2014, while traditional television viewing dropped 4% during the same time period.

Meanwhile, a Digital TV Research report predicts that Netflix, the biggest online video driver, will reach 17 million paying subscribers internationally by the end of 2014.

Regular TV is of course still the big kahuna of home entertainment: Nielsen’s new Total Audience Report shows that the 4% decline is fairly negligible. The average American still watches over 141 hours of live TV a month — compared to 147 hours of live TV a month last year. So, the average six-hour decline translates to just 12 minutes less per day of regular TV viewing, which could stem from various societal trends — anything from more employment to the uptick in home cooking.

Online video, meanwhile, is definitely on the rise, jumping to 11 hours per month, up from seven hours per month this time last year. An increase in exclusive content, like the Netflix hit Orange is the New Black, is likely driving much of the interest. Netflix also noted recently that it is paying $90 million for a new series, Marco Polo. Content-wise, that’s second only to HBO’s Game of Thrones investment.

“Hits drive viewership and consumers live comfortably in this new media world,” Dounia Turrill, senior vice president of insights at Nielsen, noted in the report. “Content remains king and consumers are steering their own content discovery experience.”

Netflix is banking on its big cash-play for Marco Polo to bring in more international subscribers. “We just tried to make the most exciting, entertaining show we could about this very special world and hope that it would be accessible in a lot of different markets, in a lot of different regions,” Dan Minahan, an executive producer of the series, told the New York Times.

Netflix continues to make up a good chunk of what’s driving digital consumption in the US, according to a Digital TV Research report. And thanks to launches in six European countries since Netflix’ latest numbers in September, the streaming giant will reach 17 million paying subscribers internationally by the end of 2014, even as growth in the US slows.

“It is no secret that we want Netflix to be a global product,” chief content officer Ted Sarandos told the paper. “That is the mission.”


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