UPDATED 17:41 EDT / FEBRUARY 14 2011

Netflix Takes the Shine Off YouTube and Hulu

A Nielsen report revealing the current trends in the TV and film industry shows that Netflix is the top player in the online video domain.  The time spent per viewer on its streaming website have increased to 11 hours, up  23% from December 2010. In comparison with January 2010, the time spent watching online video rose 45% in January 2011, making Netflix the only paid video service to be a top-10 video site on the Web in terms of total number of streams and unique visitors.

But little ships can sometimes sink a great ship.  Netflix, offering subscription-based content, is beating giants like YouTube and Hulu in the online sector, despite both offering content for free. The stakes are higher than anyone can imagine: the greater the number of online video fans, the greater the revenues from online video advertising. Online video ad spending in the U.S. is expected to grow to $3.0 billion in 2012, up from $1.9 billion this year, according to eMarketer report cited here. Such spending will increase to almost $6 billion in 2015, their report said.

This is another point of contention as Google and Microsoft are currently engaged in another disagreement around online video. They are fighting over how online video will be accessed and distributed openly on the web. Microsoft has accused Google of ‘natively supporting only the newly open-sourced WebM video format in its Chrome browser, rather than the H.246 format preferred by Microsoft and Apple’ and stated it would build a Chrome plug-in to restore support for H.264.

Recently we covered the $250 million raised by PPLive, the transaction reiterating that online video is attracting a great deal of money at the moment. Online video targets all demographic groups and studies indicate that 49 percent of people watch online videos for an hour each day. “Widespread adoption of devices, ranging from PCs to the iPad and smartphones has made it easy for…all ages to watch video content whenever and wherever they wish to do so,” said the report, which was cited on Thomson Local Marketing News.


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