Online news video equals cable for viewership
Michelle Clancy | 17 June 2014
More than six in ten US adults now watch video online – and roughly half of those, 36%, catch up on their news via online video, according to a recent report by Pew Research. This is roughly the same percentage of Americans who now get news from Facebook or watch cable news channels regularly.
The firm found that technological improvements lowering the barrier to entry, both for the audience and those in the news business, have spurred a wave of new entrants into the digital news video space. With 36% of US adults recording videos on their cell phones, citizens are playing a valuable role in the news process, sharing videos of eyewitness moments around news events small and large. And both digital news outlets like Vice Media as well as legacy outlets like NBC took steps to develop approaches to digital video content in 2013.
But a closer look suggests that digital news video does not necessarily have a clear or simple path to becoming a major form of news in the future. Producing high-quality video – or even streaming it live – can be costly, and the pay-off is not clear. Video advertising, while on the rise, amounts to just 10% of all digital ad revenue and just 2% of total ad revenue. Large distributors of video content like YouTube already account for a large portion of video watching on the Web, and a hefty share of the revenue.
"And for traditional legacy providers – local TV stations and national networks – most of their audience and revenue are still in the legacy platforms, which may reduce these companies' desire to invest in digital video in a big way," Pew said. "Non-digital news revenue on local and national broadcasts, as well as cable, now amounts to $16 billion a year."
On the consumer side, while television viewing has been the most popular form of news consumption for decades, it is still not clear how much that will translate to high levels of video-based news online. The growth rate has slowed considerably since 2007 (the year after YouTube was purchased by Google and the year the iPhone was released). From 2007 to 2009 the percentage of adults watching online news video increased 27%, but the next four years (2009 to 2013) saw just 9% growth.
"It is true that mobile devices are accounting for a larger share of video viewing, which could bring another spike in growth, but at the moment that increase remains only a hypothetical," Pew noted.
Overall, the Pew study finds that online video is clearly becoming a part of the news media landscape. News is a part of what people watch online, and, more than ever, the public is a part of creating this news.
"But online video is also very much still in development, and the revenue opportunities, while they exist, are complicated," the firm noted. "Some who have moved most powerfully into this space are digital natives, not tethered to legacy platforms that still account for a good portion of their audience and revenue."