New research by multi-screen media measurement service provider Rentrak has revealed the enduring popularity of TV-based video on-demand (VOD) TV services.

Aggregating data from its OnDemand Essentials service, Rentrak found that in 2010, an average of 38 million set-top boxes per month accessed VOD content, an 11% increase over 2009. In an average month, the survey also found, 44% of all enabled set-top boxes access VOD.

Encouragingly, the business of VOD looks like it is taking off with VOD users making an average of 17.1 transactions per month in 2010 and movies-on-demand business being up 9.1%, to accrue almost $1 billion in revenue.

However, and not really surprisingly, free on demand, the so-called FOD, represented 74% of all VOD transactions in 2010 with music, kids and TV entertainment being the top FOD categories. TV entertainment was the fastest growing sub-sector up 31% year-over-year.

"Video on-demand continues to be an important revenue stream for both cable operators and content providers. Free on-demand growth represents an opportunity for advertisers to leverage these targeted and engaged viewers," said Kristie Fortner, Vice President of Analytical Solutions at Rentrak.