Mainstream Revenues for Online TV

New research from Informa Telecoms & Media shows that legitimate online TV and video services will generate revenues of US$7.9 billion in 2013, almost six times the 2007 figure. Advertising will consistently outperform a la carte and subscription-based download services in terms of revenue generation and North America will be the largest revenue-generating region, accounting for 63 percent of the 2013 global total.

The Informa report, called Online TV and Video: The over-the-top challenge to traditional TV, is published today and has found that online TV and video is successfully shaking off its perception as a marginal technology. Adam Thomas, author of the report, said "The Writers Guild strike brought much of Hollywood to a standstill for several months. The fact that revenues derived from Online TV and video were at the heart of the dispute indicate just how important this sector has become."

While the Internet has long been considered a technology of the future for film and TV executives, it is now having a measurable impact on traditional sectors, indicating that its time has come. Digital media is changing the consumption of TV from an 'on-the-couch' to a 'watch anywhere' activity. Content has become interactive rather than passive, with the emergence of 'citizen media' concepts, such as blogs and social networks, added Thomas. The top three revenue-generating countries in the online TV arena are the US, UK and Japan.

The biggest negative for broadcasters and content suppliers is the potential for online TV and video to hurt their existing business models. To date its harmful impact has been limited and there are examples of a beneficial affect, with CBS and NBC both reporting improved TV ratings for programmes showcased online. The report has found that content companies actively co-operating with the leading online TV and video services are best-placed to avoid any potentially harmful effects.