1. The State of Online Video
Dan Piech
OMMA VIDEO - January, 2010

2. MILLION PEOPLE
IN THE UNITED STATES
ARE GOING TO WATCH
© comScore, Inc. Proprietary. 2 Source: comScore Video Metrix, December 2010

3. MILLION PEOPLE
IN THE UNITED STATES
ARE GOING TO WATCH
BILLION VIDEOS
© comScore, Inc. Proprietary. 3 Source: comScore Video Metrix, December 2010

4. MILLION PEOPLE
IN THE UNITED STATES
ARE GOING TO WATCH
BILLION VIDEOS
© comScore, Inc. Proprietary. 4 Source: comScore Video Metrix, December 2010

5. 2006
<embed src=“video swf”>
src=“video.swf”>
© comScore, Inc. Proprietary. 5

6. 2006
$324 MILLION (ad spend)
63 BILLION VIDEOS
¢0.7 PER VIDEO
© comScore, Inc. Proprietary. 6 Source: comScore Video Metrix, December 2010; eMarketer, December 2009; IAB, 2010

7. 2010
<video>
© comScore, Inc. Proprietary. 7

8. 2010
$1,440
$1 440 MILLION (ad spend)
441 BILLION VIDEOS
¢0.4 PER VIDEO
© comScore, Inc. Proprietary. 8 Source: comScore Video Metrix, December 2010; eMarketer, December 2009; IAB, 2010

9. 2006 – 2010
© comScore, Inc. Proprietary. 9

10. 2006 – 2010
$ Ad Spend: +344%
p
© comScore, Inc. Proprietary. 10

11. 2006 – 2010
$ Ad Spend: +344%
p
# Videos: +600%
© comScore, Inc. Proprietary. 11

12. AGENDA
THE STATE OF ONLINE VIDEO
THE FUTURE OF VIDEO MONETIZATION
WHY VIDEO?
© comScore, Inc. Proprietary. 12 Icon Source: Dale Morrell, 19eighty7.com

13. THE STATE OF ONLINE VIDEO
Ubiquity
The rise of long-form
Video advertising
© comScore, Inc. Proprietary. 13 Icon Source: Dale Morrell, 19eighty7.com

14. The growth of the online video universe
Number of People Streaming (000) Streams (MM)
180,000 40,000
160,000 35,000
140,000
30,000
120,000
25,000
100,000
20,000
80,000
15,000
60,000
10,000
40,000
20,000
20 000 5,000
0 0
May…
May…
May…
May…
May…
Jan '06
Jan '07
Jan '08
Jan '09
Jan '10
Mar '06
Sep '06
Mar '07
Sep '07
Mar '08
Sep '08
Mar '09
Sep '09
Mar '10
Jul '06
Nov '06
Jul '07
Nov '07
Jul '08
Nov '08
Jul '09
Nov '09
Sep '10
Jul '10
Nov '10
© comScore, Inc. Proprietary. 14 Source: comScore Video Metrix

15. © comScore, Inc. Proprietary. 15 Image Source: Craig Chelius

16. The growth of the online video universe
Number of People Streaming (000) Streams (MM)
180,000 40,000
160,000 35,000
140,000
30,000
120,000
25,000
100,000
20,000
80,000
15,000
60,000
10,000
40,000
20,000
20 000 5,000
0 0
May…
May…
May…
May…
May…
Jan '06
Jan '07
Jan '08
Jan '09
Jan '10
Mar '06
Sep '06
Mar '07
Sep '07
Mar '08
Sep '08
Mar '09
Sep '09
Mar '10
Jul '06
Nov '06
Jul '07
Nov '07
Jul '08
Nov '08
Jul '09
Nov '09
Sep '10
Jul '10
Nov '10
© comScore, Inc. Proprietary. 16 Source: comScore Video Metrix

17. Every month:
NUMBER OF VIEWERS 180MM
% OF INTERNET AUDIENCE 85%
VIDEOS VIEWED 36B
VIDEOS PER PERSON 200
VIEWING TIME PER PERSON 13 hr
© comScore, Inc. Proprietary. 17 Source: comScore Video Metrix, December 2010

18. Age breakdown: Percent of Internet audience that view video
100
90
80
70
60
50
40
30
20
10
0
12-17 18-24 25-34 35-44 45-54 55-64 65+
© comScore, Inc. Proprietary. 18 Source: comScore Video Metrix, December 2010

19. Age breakdown: Videos per viewer
350
300
250
200
150
100
50
0
12-17 18-24 25-34 35-44 45-54 55-64 65+
© comScore, Inc. Proprietary. 19 Source: comScore Video Metrix, December 2010

20. Viewing by gender (Top 100 Video Properties)
500
Females Males
473.0
400
366.0
300
200
170.0
139.0
100 89.4 89.8
48% 52% 43% 57% 42% 58%
0
UVs (MM) Videos per Viewer Minutes per Viewer
© comScore, Inc. Proprietary. 20 Source: comScore Video Metrix, December 2010

21. Where are viewers watching content videos?
Total Unique
Web Property Viewers (000)
(of content videos)
Google Sites 145,829
Yahoo! Sites 61,803
VEVO 50,320
AOL, Inc. 47,687
Viacom Digital 47,282
47 282
Facebook.com 42,500
Microsoft Sites 35,348
Fox Interactive Media 31,552
NBC Universal 29,192
Turner Digital 27,714
© comScore, Inc. Proprietary. 21 Source: comScore Video Metrix, December 2010

22. Duration moves upwards as long-form TV content moves online
180
Total US Viewing Duration +162%
160
140
Billions of Minutes
s
120
100
s
80
60
40
20
0
Apr-09 Jun-09 Aug-09 Oct-09 Dec-09 Feb-10 Apr-10 Jun-10 Aug-10 Oct-10 Dec-10
© comScore, Inc. Proprietary. 22 Source: comScore Video Metrix

23. Growth in long-form TV programming online
 Yearly growth in videos viewed on long-form TV programming sites
Videos Viewed Videos per Viewer
104% 75%
increase increase
© comScore, Inc. Proprietary. 23 Source: comScore Video Metrix, Dec 2009 – Dec 2010

24. Growth in long-form TV viewing repeat engagement
Average percent of a site’s viewers that
view videos on any given day
(long-form sites only)
4% 8%
2009 2010
© comScore, Inc. Proprietary. 24 Source: comScore Video Metrix, Dec 2009 – Dec 2010

25. Ad impressions per month
5.9
59 Billion
video ad impressions per month
Billion
2.4 video ad minutes per month
148 Million
Milli
viewers exposed to video ads
© comScore, Inc. Proprietary. 25 Source: comScore Video Metrix, December 2010

26. Ad Impressions per month – 6 month variances
36 % Growth
video ad impressions per month
% Growth
30 video ad minutes per month
8 %GGrowth
th
viewers exposed to video ads
© comScore, Inc. Proprietary. 26 Source: comScore Video Metrix, June 2010 – December, 2010

27. Video advertising reach
83% video
viewers
70%
total web
49% total
US
Population
Linear video ads are served across
the web in a month reach the
average video viewer 40 times
g
© comScore, Inc. Proprietary. 27 Source: comScore Video Metrix, December 2010

28. Ad Percentage
16%
Ads
Content
C t t
84%
16.4% off videos viewed are ads
16 4% id i d d
© comScore, Inc. Proprietary. 28 Source: comScore Video Metrix, December 2010

29. THE FUTURE OF VIDEO MONETIZATION
Are we monetizing to the degree we could be?
Comparison to television
Viewer expectations are being molded as we speak
© comScore, Inc. Proprietary. 29 Icon Source: Dale Morrell, 19eighty7.com

30. Online video viewing growth is outpacing ad spending growth
Ad Spending (MM) Streams (MM)
$6,000 500000
$5,202 450000
440,692
$5,000
400000
350000
$4,000 $3,844
300000
260,049 $2,858
$3,000 250000
200000
$1,966
$2,000
142,254 150000
$1,440
102,141 $1,029 100000
$1,000 $734
63,515
63 515
$324 $410 50000
$135 $225
$40 $55 $85
$0 0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
© comScore, Inc. Proprietary. 30 Source: comScore Video Metrix, December 2010 and eMarketer, December 2009

31. Not enough ads?
Ads too cheap?
© comScore, Inc. Proprietary. 31

32. All Online Video Television
1.6%
Ads Content
25%
98.4% 75%
1.6% of time spent viewing video
online is spent viewing ads compared to
20-30% on TV
© comScore, Inc. Proprietary. 32 Source: comScore Video Metrix, December 2010

33. Entertainment Sites Television
5.3%
Ads Content
25%
94.7% 75%
5.3% of time spent viewing video
online on entertainment sites is spent
viewing ads compared to 20-30% on TV
© comScore, Inc. Proprietary. 33 Source: comScore Video Metrix, December 2010

34. Long-Form Premium TV-content Television
8.5%
Ads Content
25%
91.5% 75%
8.5% of time spent viewing video
online on long-form premium TV content
is spent viewing ads compared to 20-30%
on TV
© comScore, Inc. Proprietary. 34 Source: comScore Video Metrix, December 2010

35. What do our Viewers Really Value?
Reasons to Watch Online
Missed episode on TV 69%
Like to see past episodes 56%
Convenience 57%
Less ads 42%
Cross Platform [B]
Can discover new shows easily 29%
Prefer the online experience
p 13%
Don't subscribe to cable/ don't have a TV 9%
0% 20% 40% 60% 80%
Q12. What are the reasons why you like to watch Original TV shows online? Check all that apply.
Base sizes:
Total=617
© comScore, Inc. Proprietary. 35 Source: comScore TV Everywhere Survey, 2010 Online Only= 115
Both TV/Online= 502

36. What do our Viewers Really Value?
Reasons to Watch Online
Missed episode on TV 69%
Like to see past episodes 56%
Convenience 57%
Less ads 42%
Cross Platform [B]
Can discover new shows easily 29%
Prefer the online experience
p 13%
Don't subscribe to cable/ don't have a TV 9%
0% 20% 40% 60% 80%
Q12. What are the reasons why you like to watch Original TV shows online? Check all that apply.
Base sizes:
Total=617
© comScore, Inc. Proprietary. 36 Source: comScore TV Everywhere Survey, 2010 Online Only= 115
Both TV/Online= 502

37. 100.0
Desired Length of Commercials Online
80.0
60.0
40.0
20.0
0.0
1 min 2 min 3 min 4 min 5 min 6 min 7 min 8 min 9 min 10 min 11 min 12 min 13 min 14 min 15 min
Negligible Minimal Long Enough Too Long
© comScore, Inc. Proprietary. 37 Source: comScore TV Everywhere Survey, 2009 Base sizes
Total=640

38. 100.0
Desired Length of Commercials Online
80.0
60.0
40.0
20.0
0.0
1 min 2 min 3 min 4 min 5 min 6 min 7 min 8 min 9 min 10 min 11 min 12 min 13 min 14 min 15 min
Negligible Minimal Long Enough Too Long
© comScore, Inc. Proprietary. 38 Source: comScore TV Everywhere Survey, 2009 Base sizes
Total=640

39. Amount of Advertising is:
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1min 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Fair Minimal Long Too Long
© comScore, Inc. Proprietary. 39 Source: comScore TV Everywhere Survey, 2010 Base sizes:
Total=616

40. Are we conditioning our
viewers to fewer ads?
© comScore, Inc. Proprietary. 40

41. WHY VIDEO?
What makes the video universe uniquely powerful?
The social nature of online video
© comScore, Inc. Proprietary. 41 Icon Source: Dale Morrell, 19eighty7.com

42. And it works
How would you rate the commercials you see when watching
original TV shows on ONLINE vs. TV? Completely Agree – Top 2 Box
i i l V h ONLIN V?
Online Rating
Online Rating TV Rating
TV Rating
Commercials make me think favorably about the brand being 31.2%
advertised 18.7%
29.8%
Commercials are relevant to me
Commercials are relevant to me 18.6%
30.1%
Commercials are memorable 21.8%
The commercials interfere with my show viewing 32.1%
32.0%
I enjoy watching the commercials 19.5%
34.3%
Commercials are annoying 25.6%
35.8%
Commercials are interesting 22.0%
© comScore, Inc. Proprietary. 42 Source: comScore TV Everywhere Survey | n = 1825

43. What are the reasons you visited an advertiser’s website while
watching a show online?
A video commercial played during the show
p y g
A product that you noticed in the program
A video commercial played before the show
A text or image-based commercial
surrounding the video player
di th id l
Other
0 10 20 30 40 50 60
Percentage of respondents
© comScore, Inc. Proprietary. 43 Source: comScore TV Survey, 2010

44. Nearly 100% of online spenders are video viewers
Non-Video
Non Video
Viewers
4%
Video
Viewers
96%
© comScore, Inc. Proprietary. 44 comScore Video Metrix and comScore E-Commerce Online Spend Data – June 2010

45. Not all video audiences are created equal when it comes to video
advertising and retail spending at a category level
Buying Power Index
170
180
136 145
160
140 115
120
100
80
60
40
20
0
Total Video Sites Video Ad Network Earned Media & Long Format TV
Category Social Video
© comScore, Inc. Proprietary. 45 comScore Video Metrix and comScore E-Commerce Online Spend Data – June 2010

46. Video is social, interactive, lean forward…
Note the clichéd clip-art graphics
© comScore, Inc. Proprietary. 46

47. 1 in 3 video viewers comment
© comScore, Inc. Proprietary. 47

48. 2 in 5 upload videos
© comScore, Inc. Proprietary. 48

49. 1 in 2 regularly share videos
© comScore, Inc. Proprietary. 49

50. More than 1 in 2 view online video with others
© comScore, Inc. Proprietary. 50

51. Among 18-34 s, more than 2 in 3 view with others
18-34’s
© comScore, Inc. Proprietary. 51

52. THE STATE OF ONLINE VIDEO
Ubiquity
The rise of long-form
long form
Video advertising
THE FUTURE OF MONETIZATION
Are we monetizing to the degree we could be?
Comparison to television
Viewer expectations are being molded as we speak
WHY VIDEO?
What
Wh t makes th video universe uniquely powerful?
k the id i i l f l?
The social nature of online video
© comScore, Inc. Proprietary. 52 Icon Source: Dale Morrell, 19eighty7.com

53. Thank you!
Dan Piech | dpiech@comscore.com