Broadcast TV vs Online TV

With the continuing popularity and increase of online VoD services, David Brennan, research and strategy director at thinkbox, looks at how TV and the internet can complement each other …

Entertainment junkies that we are, we’ve always wanted more from our TVs – whether it is a bigger and better one, the ability to catch-up with programmes we’ve missed, the power to take TV with us out of the house or more opportunities to interact with our favourites. Since the small screen glittered into being, we’ve been obsessed with polishing the entertainment diamond in our living room and nothing polishes what TV can do better than the internet. Its TV’s buff-upper in chief.

Thinkbox research has shown how TV and the internet are the perfect complement to each other, helping each other to grow and develop. Early in 2008 we published a joint study with the IAB that revealed how using TV and the internet together in ad campaigns will make those campaigns far more powerful. At the moment, we are waist deep in a new study that builds on these findings to examine the world of online TV services. Full findings land early in 2009, but the initial findings offer a strong sense of what we can expect in the future.

Headline-grabbing though it undeniably can be, online TV viewing is still a comparatively marginal activity – Touchpoints found that 11% of adults had tried it. But it is heading mainstream as it grows rapidly. Since an ‘establishment survey’ we ran in June, the number of broadband internet users accessing TV content ‘in the last week’ grew from 48% to 64% and they are accessing the content on a more regular basis.

Our research has shown that the online TV landscape is dominated by established TV broadcasters. More people in the UK now use broadcasters’ online services – including ITV Player, 4OD, Demand Five, MTV.co.uk and Sky Player – than YouTube, and the latest data shows BBC iPlayer’s reach alone is now higher than that for YouTube in the UK. Non-broadcaster owned TV services – like Joost or Zattoo – are far smaller in comparison.

A central finding from our new research is that online TV viewing is currently incremental to broadcast TV viewing, not cannibalising it. This is backed up by figures from the Broadcasters’ Audience Research Board showing consistent growth for broadcast viewing (we’re watching an average of an hour more commercial TV a week than 10 years ago). With recession glowering at everyone, it’s likely that people will stay in more and watch the free entertainment. In a time when good news is thin on the ground, this should be music to the ears of advertisers who get more viewers, more commercial impacts and therefore bargain prices.

The lack of cannibalism so far is indicative of how online TV fulfils different needs states for the viewer. The need it primarily meets is keep- or catch-up. Our research shows that by far the main reason people use online TV services is to catch-up with broadcast schedules. Around 78% of online TV use is predominantly to catch-up; it is enhancing loyalty to broadcast TV schedules and actually helping to keep viewers in the broadcast stream. The remaining 22% is used mainly for discovering new TV content.

Those catching or keeping up with broadcast streams generally approach online TV differently from those trying to discover new content. Those catching up tend to approach online TV in the same way as they do broadcast TV and consume it in the same way. So they ‘schedule’ their viewing time online, don’t access other parts of the web whilst they are watching and talk about their online TV experiences very much in a television vernacular of episodes, series and switching on and off. ‘Discoverers’ expect their online TV experience to resemble their general online experience and look for more interactivity.

People undoubtedly welcome the convenience of online TV but they still prefer the broadcast TV schedules as their first port of call. And what we’re also seeing as TV establishes itself online is that TV is starting to borrow the best of the web in terms of attributes like snippets, highlights, exclusive content and getting ahead; and the web is in turn borrowing the best from TV with the introduction of aggregation, better organisation and ease of use. They are mutually beneficial.

Although the vast majority of online TV viewing remains in-home, our research has also revealed that viewing at work or via mobile devices is rapidly increasing. Usage of both in-work and mobile has doubled in the last six months; at work went from 8% to 16% and viewing via a mobile phone increased from 4% to 10%.

Our previous research with the IAB showed that online TV viewers were four times more likely to think of pre-roll advertising as ‘TV advertising’ rather than ‘online advertising’ and found that consumers are now far more aware of what TV and online advertising can do for them. They genuinely appreciated the complete package that TV and online, used together, offers. Our new research adds another layer to this, showing that online TV viewers understand and appreciate the commercial contract that allows them to watch free, quality programmes online as much as they do offline. Advertising around online TV content is not only accepted by online TV viewers, it is expected.

One final finding of note is that it appears TV’s expansion online is helping the internet by opening it up to wider audiences. As the internet continues to liberate TV, TV’s expansion online is returning the favour. People who were previously uncomfortable using the internet have found that watching TV online is encouraging them to explore and use the internet more in other ways. TV and the internet are liberating each other.