TV viewers around the world are increasingly going online to find their favorite entertainment. Consider that in 2010, during the World Cup in South Africa, the peak online streamed traffic generated was 1.4 Tbps. In the last round of group play during the 2014 World Cup, when final matches are played simultaneously, the USA versus Germany and Ghana versus Uruguay games attracted 1.7 million simultaneous viewers in the U.S. and drove streaming traffic of 6.8 Tbps.1,2
The move online is not confined to just traditional television, physical media is feeling the change too. Between Q1 2013 and Q1 2014 movie and TV disc sales fell 13% and physical disc rentals fell 16%. At the same time subscription VOD revenue increased 27% and electronic sales of movies and TV shows increased 43%.3
Capturing, or re-capturing, a viewer online is clearly important in the new multiscreen world, but it isn’t easy. Companies like HBO and Comcast attract a broad and deep audience through the traditional broadcast channels. Unfortunately, these same companies struggle to attract online users, as we shall see later in this paper.
To understand what it takes to win and retain online video customers, this paper will explore the differences between how consumers behave online and how they behave while watching television. Through the lens of a spectacular online video service failure, the paper will look at how to exploit these differences to attract, keep and monetize online video viewers.
This paper is made possible by the generous contribution of Vindicia.