The Impact of DVRs
From Kenradio.com
TV advertising spending is growing, and analysts expect that to continue through 2010. Online video usage is increasing, online advertising spending is taking a larger proportion of the overall advertising pie and digital video recorders (DVRs) and video-on-demand (VOD) capabilities are becoming widespread, according to a new study by eMarketer. Talk of TV’s short-term demise is unfounded. Yet it is equally shortsighted to think that the traditional TV model will not change significantly over the next decade.
Estimates show by 2011 there will be more than 200 million broadband Internet users in the US, 92% of whom will regularly watch video online. At that time the broadband audience will be two-thirds the size of the total US TV audience, up from less than half the TV audience in 2006. In addition, 45.1% of TV households will have DVRs and nearly 59% will have VOD capabilities — both of which are used to avoid advertising. TV advertising dollars will inevitably shift to alternative channels. Online advertising is likely to be the major beneficiary of this redistribution. Most recent online advertising spending estimates show that by 2011, $44 billion will be spent on online advertising, up from $16.9 billion in 2006, and 10% of all online advertising will be spent on online video advertising.
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