According to Online Video Forecasts, a new report by ZenithOptimedia in conjunction with Newcast, the average amount of time people will spend consuming online video each day will increase by 23.3% in 2015 and by a further 19.8% in 2016.
The report details that the growth in video consumption is being driven by the rapid rise of smartphone and tablet penetration across the globe, together with the resulting changes in consumer behaviour. Video consumption on mobile devices (such as smartphones and tablets) is forecast to grow by 43.9% in 2015 and 34.8% in 2016. Meanwhile, video consumption on non-mobile devices will continue to grow, though at more moderate rates, increasing by 9.5% in 2015 and 6.5% in 2016.
The report also points out that mobile will become the main platform for viewing online video next year. In 2012 mobile devices accounted for 22.9% of time spend watching online video worldwide. By 2014, this proportion had risen to 40.1%, and we expect it to reach 52.7% in 2016 and 58.1% in 2017.
Total number of regular linear TV viewers to start declining in 2016
The research further predicted that the number of people regularly watching traditional, linear TV will peak this year, and will start to decline for the first time in 2016. We forecast that the number of regular linear TV viewers will rise 3.1% in 2015 but then shrink by 1.9% in 2016 and 0.9% in 2017. The number of regular linear TV viewers has been in decline in France and Russia since 2013, in the UK and the US since 2014, and is expected to start to decline in China this year. The decline of linear TV viewing is in direct correlation with the increasing quantity and quality of content available online, both from short-form platforms like YouTube and long-form platforms like Netflix. ZenithOptimedia forecasted that the number of regular online video viewers will increase by 5.8% in 2015, 5.1% in 2016 and 5.3% in 2017.
Advertising expenditure on online video will soon account for an eighth of total internet adspend
Online video’s share of global digital adspend is rising rapidly. The agency said ‘It was 8.8% in 2012 and 10.2% in 2014; by 2017 we expect it to rise to 12.8%, an eighth of all internet adspend. Online video is the fastest-growing category of internet advertising: we forecast it to grow by 28.9% to USD 16.1 billion worldwide in 2015, followed by 22.5% growth in 2016 and 19.7% growth in 2017, when it will total USD23.7bn’.
“Consumers all around the world are rapidly embracing online video, because it offers them a near limitless array of engrossing content. Some of the keenest users are the young, affluent viewers who are hardest to reach on television. Brands are finding online video a particularly effective way to reach these valuable audiences, not just with advertising, but also with branded content; content that can inform or entertain consumers in a deeper and richer way than is possible with short, interruptive ads,” commented Mark Waugh, Global Managing Director, Newcast.
