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VOD is the fastest growing alternative TV delivery platform

VOD is the fastest growing alternative TV delivery platform

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According to Rentrak Corporation’s new report “State of VOD: Trend Report 2011”, video-on-demand (VOD) is at the tipping point of becoming a major ad medium

Rentrak, who are a leader in multi-screen media measurement serving the advertising, television and entertainment industries, say that the report shows that Free-On-Demand (FOD) content, which are programs that run on ad-supported broadcast, cable and on-demand only networks, experienced 17% growth in 2011 to 6.8 billion transactions.

With an average of 5 hours and 17 FOD television shows or videos watched per month, the potential value of the ad inventory in these programs 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.

“We like to think about VOD as the power of 8-plus! In the 8 years since VOD has taken off, homes now watch 8 hours of VOD a month and 80% of that is free TV programs, with more than 80% of the free TV program 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 State of VOD: Trend Report 2011:

  • VOD grew overall by more than 1 billion transactions from 7.8 billion last year to 8.8 billion in 2011.
  • 77% 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 program 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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