As Online Viewing Soars, Internet TV Will Soon Be the Only TV

As Online Viewing Soars, Internet TV Will Soon Be the Only TV

More people are watching TV online than ever—a lot more. Viewers may not be cutting the cable cord altogether, but growth in the number who want to watch TV over a different set of pipes is surging, according to a new report from Adobe. If anyone was still wondering why HBO and CBS plan to offer an online-only option, the trend is clear: the internet is where people want to watch. In more and more homes, online TV isn’t a geeky novelty, a sidelight to the traditional version. It’s just what TV looks like now.

Adobe is in a position to know because its software runs the platform that nearly all US cable customers use to log into the online versions of their subscriptions, according to the company. Researchers tracked 165 online video views and 1.53 billion logins over a year, and they found that total TV viewing over the internet grew by 388 percent in mid-2014 compared to the same time a year earlier—a near-quintupling. And the increase is more than just a few diehards binge-watching: the number of unique viewers well more than doubled, growing 146 percent year-over-year.

Eventually cable will follow bunny ears into the basement of dead technology, and online TV will be called something else: plain old TV.

According to analyst Tamara Gaffney, three factors are drove this growth: more apps and sites for watching, more content to watch on those apps and sites, and the World Cup. Sports act as as kind of “appetizer” whetting viewers’ appetites for the flexibility and breadth of online TV, Gaffney says. The World Cup was an especially strong lure because the internet was the only way to watch so many games that traditional TV lacked the bandwidth to show. But Gaffney said once viewers came for sports, they stayed for everything else.

“Households generally connect because of sports,” she says. “But then when they start to use online television, they start to branch out.”

Back to the Big Screen

According to Adobe, viewers have branched out so much that, for the first time, viewers watched more movies online than sports. The average was 4.5 movies per month, Adobe says, versus two a year ago. Viewing of “episodic television” over the internet also saw a sharp increase. The jump is all the more remarkable since Adobe’s survey doesn’t include the main streaming services: Netflix, Amazon Prime, and Hulu. In other words, many people still paying for cable are less interested in watching TV in the cable way and more in the way Netflix has led viewers to come to expect.

“When you want to really binge-view something you didn’t know you wanted to watch until the season was over, you’re going to turn to the online option,” Gaffney says.

The turn toward online TV, however, hasn’t entirely meant a turn away from the television itself. In fact, the gadgets that showed the greatest increase in their share of use for internet-TV watching were gaming consoles and over-the-top devices such as Apple TV and Roku. Where a year ago they accounted for just 3 percent of online TV viewing, they now account for 10 percent. These devices all pipe TV from the internet to the big screen, and the one thing viewers are still most eager to watch there is sports.

“During the Olympics and World Cup, people wanted to watch on the big screens in their living room,” Gaffney says.

Broadcast Bottoms Out

But unlike traditional TV, the appeal of the online version is that it doesn’t require viewers to commit to a single piece of hardware. More than half (51 percent) of all online TV viewing happens on iOS apps, according to Adobe’s figures. And Gaffney believes the iPhone 6 and 6 Plus’ larger screens will only cement Apple’s place as the platform of choice for online TV. Apple’s timing appears to be good as smartphones, driven by the embrace of phablets, start to surpass tablets as the online video-viewing device of choice, according to Adobe’s findings.

Because the Adobe report covers TV-watching by viewers who are paying for cable, it’s hard to read the results as a sign that more cord-cutting is coming. But getting viewers habituated to the internet way of watching TV could hasten a less aggregated future, says Gaffney, one where customers may prefer the more personalized service of an HBO-only login, for example, versus one for their entire cable package.

The big loser would seem to be broadcast TV, since the traditional way the broadcast networks spread the news about their new shows is on their networks. For people watching TV online, those are ads they’ll never see. What they’re more likely to see is chatter on social media—if a new show generates enough buzz, wannabe viewers can track down old episodes online and binge-watch to catch up. More and more, this is the way TV is now, and there’s no reason the trend will stop. Eventually cable will follow bunny ears into the basement of dead technology, and online TV will be called something else: plain old TV.

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