VoD the fastest growing alternative TV delivery platform

Rentrak, the specialist in multi-screen media measurement serving the advertising industry, has published a report on the state of VoD. The report, based on an aggregation of data from Rentrak’s OnDemand Essentials service, shows that VoD is at the tipping point of becoming a major ad medium. Free-On-Demand (FoD) content, which are programmes that run on ad-supported broadcast, cable and on-demand only networks, experienced 17 per cent growth in 2011 to 6.8 billion transactions. With an average of five hours and 17 FoD television shows or videos watched per month, the potential value of the ad inventory in these programmes is at least one billion dollars, based on Rentrak estimates.

The on-demand platform is an excellent growth opportunity for increased ad revenue with more than 55 million US homes with access to VoD and the average home spending 8 hours per month watching VoD content. The majority of VoD viewing is spent on free programmes which advertiser and agencies customers can use the State of VoD report to identify the free content types that will provide the greatest ROI. Metrics in the State of VoD include analysis of reach by content types, duplication analysis, average title performance by content type, as well as annual and monthly performance levels for the top FoD content.

“We like to think about VoD as the power of eight-plus! In the eight years since VoD has taken off, homes now watch eight hours of VoD a month and 80 per cent of that is free TV programs, with more than 80 per cent of the free TV programme viewing occurring after the first three days of availability on-demand. Combine that with the potential ad sales of a billion dollars and you have one powerful medium,” said Cathy Hetzel, Corporate President at Rentrak.

Additional Insights from Rentrak’s report include:
– VoD grew overall by more than 1 billion transactions from 7.8 billion last year to 8.8 billion in 2011.
– 77 per cent of those transactions (6.8 billion) were for free content, providing significant opportunity for revenue growth over the coming years as ad insertion technology becomes commonplace.
– Each month, 33.8 million STBs accessed free content.
– Within FoD, major programme viewership is now dominant. The TV Entertainment category, which includes programming from the top linear broadcast and cable networks, is now the top FoD category by transactions, up from #3 last year.

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