This document summarizes key trends in U.S. video consumption over the past 5 years based on Nielsen data. It finds that while total TV screen time has increased slightly, when and how people watch video has significantly changed. Younger viewers in particular have shifted to watching more video on smartphones, tablets, computers, and game consoles rather than live TV. The increasing popularity of video on demand and connectivity of TVs and other devices to the internet has also created new opportunities for video providers.

1. TRENDS
AND
OPPORTUNITIES
BASED
ON
U.S.
VIDEO
CONSUMPTION
Brian
Fuhrer
SVP,
Product
Leadership
WHAT’S
ON
THE
MENU?

2. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
2
2
WHAT’S
ON
THE
MENU?
Trends
and
opportuniOes
in
the
U.S.
video
market..
A
brief
review
of
some
key
trends
• The
past
5
years
in
the
next
5
minutes
Recent
landscape
changes
driving
opportuni:es
The
increasing
popularity
of
Video
On
Demand
Key
enablers
to
sa:sfying
the
VOD
appe:te…

3. YEARS
5
THE
LAST

4. MINUTES
5
IN
THE
NEXT

5. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
5
SMARTPHONES
Source:
Nielsen’s
Q3
2008
3
Screen
Report
and
Q2
2013
Cross
PlaXorm
Report,
StaOsOc:
Average
number
of
persons
watching
video
on
a
mobile
phone
during
a
month.
U.S.
smartphone
video
consumers
have
quintupled
from
10
to
50
Million

6. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
6
MOBILE
VIDEO
Source:
Nielsen’s
Q3
2008
3
Screen
Report
and
Q2
2013
Cross
PlaXorm
Report,
StaOsOc:
Average
number
of
persons
watching
video
on
a
mobile
phone
during
a
month.
Mobile
video
users
are
spending
59%
more
Ome
watching
video
on
their
phones.

7. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
7
TABLETS
Source:
NPower,
NPM
Panel,
StaOsOc:
Number
of
households
with
at
least
1
tablet,
Interval:
11/02/2013
Introduced
just
3
years
ago,
over
35
million
U.S.
homes
have
at
least
one
tablet

8. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
8
COMPUTER
STREAMING
Source:
Nielsen’s
Q3
2008
3
Screen
Report
and
Q2
2013
Cross
PlaXorm
Report,
StaOsOc:
Average
minutes
per
user
per
day
streaming
video
on
a
computer
Video
consumpOon
on
a
computer
is
up
157%
among
users

9. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
9
MULTI-­‐MEDIA
DEVICES
Over-­‐The-­‐Top
enabling
devices
are
steadily
gaining
tracOon

10. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
10
OVER-­‐THE-­‐TOP
Source:
Nielsen’s
NPM
Panel,
StaOsOc:
Unweighted
count
of
homes
with
a
television
that
is
enabled
to
access
the
internet
either
directly
or
through
an
adached
device,
Interval:
10/25/2013
25%
of
U.S.
TV
homes
can
now
access
internet
video
directly
on
their
television

11. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
11
VIDEO
GAME
CONSOLE
Source:
NPower,
StaOsOc:
Percent
of
total
screen
Ome
that
is
adributed
to
video
game
console
usage,
Interval:
Q3
2013
(7/1/2013
-­‐
9/29/2013)
12%
of
total
TV
screen
Ome
for
18-­‐24
year
olds
is
now
spent
with
a
game
console

12. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
12
DVD
USAGE
Source:
NPower,
StaOsOc:
Average
minutes
per
person
per
day
using
a
DVD
player,
Interval:
Q3
2008
(6/30/2008
-­‐
9/28/2008)
and
Q3
2013
(7/1/2013
-­‐
9/29/2013)
18-­‐24
year
olds
have
cut
their
DVD
player
usage
by
50%

13. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
13
VCR
The
VCR
has
virtually
disappeared

14. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
14
DVR
PLAYBACK
Source:
NPower,
StaOsOc:
Average
minutes
per
person
per
day
watching
Ome
shijed
television,
Interval:
Q3
2008
(6/30/2008
-­‐
9/28/2008)
and
Q3
2013
(7/1/2013
-­‐
9/29/2013)
35-­‐54
year
olds
have
doubled
their
Omeshijed
viewing

15. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
15
LIVE
TELEVISION
Source:
NPower,
StaOsOc:
Average
minutes
per
person
per
day
watching
live
television,
Interval:
Q3
2008
(6/30/2008
-­‐
9/28/2008)
and
Q3
2013
(7/1/2013
-­‐
9/29/2013)
12-­‐17
year
old
Americans
are
watching
26
minutes
less
live
TV
per
day

16. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
16
TOTAL
TELEVISION
SCREEN
TIME
Source:
NPower,
StaOsOc:
Average
minutes
per
person
per
day
using
the
television,
Interval:
Q3
2008
(6/30/2008
-­‐
9/28/2008)
and
Q3
2013
(7/1/2013
-­‐
9/29/2013)
The
total
Ome
spent
using
a
television
has
increased
by
5%

17. SOME
MORE
RECENT
DEVELOPMENTS:
TWITTER,
SMART
TV’S,
AND
CABLE
MIGRATION

18. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
18
WE
ALL
KNOW
THAT
PEOPLE
TWEET
ABOUT
TV
Viewers
interacOng
with
television
programming
through
social
media
is
an
important
consumer
phenomenon
Source: Nielsen Social, Unique Audience Data from 9/1/13-11/30/13, Nielsen Qtr 3 2013 Connected Devices Report
of
smartphone/tablet
owners
use
devices
as
second-­‐screens
while
watching
TV
Tweets about U.S.
TV in 2013, sent by
36 million people
Average Daily Unique
Audience seeing Tweets
about U.S. TV
11
990
84
percent
million
million

19. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
19
SMART
TV
GROWS
FROM
13%
TO
18%
YOY
Smart
TVs
are
more
likely
to
be
located
in
the
Living
Room
Source: Nielsen Custom Data HHLD, February 2014
February
2014
No
Smart
TV,
82%
Smart
TV
and
enabled,
10%
Smart
TV
and
not
enabled,
9%
18%
Smart
TV
PenetraOon
71%
20%
5%
4%
Living
Room
Bedrooms
Basement
Other
Smart
TV
by
LocaOon
52%
enabled
51%
enabled
53%
enabled
49%
enabled

20. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
20
DISTRIBUTION
CONTINUES
TO
SHIFT
FROM
WIRED
CABLE
9.3
9.4
9.5
9.5
10.2
55.7
53.6
51.8
49.5
47.1
5.3
6.6
7.9
9.4
10.9
29.6
30.4
30.8
31.5
31.8
Feb
'10
Feb
'11
Feb
'12
Feb
'13
Feb
'14
Broadcast
Only
Wired
Cable
(No
Telco)
Telco
ADS
Percent
of
Total
US
Source: Nielsen NPM, data from the 15th of each month, based on scaled installed counts, Broadband Only Households fall into the ADS bucket
Percent of Total US is based on a sum of the four breaks listed and is slightly higher than total Composite households

21. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
21
Homes
with
alternaOve
means
to
receive
content
BROADBAND
ONLY
SKEWS
YOUNGER
Source: Nielsen NPOWER, Based on Scaled Installed Households, Feb ‘14
Total
U.S.
African
American
Asian
American
Hispanic
White
Non-­‐Hispanic
HH 1.6%
1.0%
4.1%
1.2%
1.6%
P2-­‐11 2.5%
0.8%
2.8%
0.6%
3.5%
P12-­‐17 1.6%
1.0%
2.3%
1.6%
1.7%
P18-­‐34 3.3%
2.3%
7.2%
1.2%
4.0%
P35-­‐49 1.6%
1.0%
1.6%
1.1%
1.9%
P50+
0.3%
0.0%
0.4%
0.0%
0.4%
Broadband
Only
PenetraOon%

22. AN
OPTION
GROWING
IN
POPULARITY:
VIDEO
ON
DEMAND

23. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
23
THERE
WILL
ALWAYS
BE
LIVE
TELEVISION
Live
events
and
top
programs
conOnue
to
adract
a
live
audience
Source:
NPower,
StaOsOc:
Percentage
of
prime
Ome
program
viewing
that
was
live
versus
playback
within
7
days
(p2+),
Interval:
September
2013
(8/26/2013
–
9/29/2013)
94%
94%
88%
88%
86%
77%
77%
6%
6%
12%
12%
14%
23%
23%
News
Sports
Event
Awards
Ceremonies
Comedy
Variety
SituaOonal
Comedy
General
Drama
General
Variety
Live
Timeshijed

24. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
24
TV
Viewing
OpOons
Mobile
Devices
TradiOonal
Linear
On
Demand

25. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
25
A
THIRD
OF
PEOPLE
ACCOUNT
FOR
HALF
THE
VIEWING
(HINT:
AND
THEY’RE
NOT
THE
YOUNGEST
HALF)
13.4%
9.6%
8.4%
5.1%
9.8%
6.7%
13.2%
10.9%
20.1%
20.0%
7.4%
8.9%
27.8%
39.0%
Universe
EsOmate
PUT
P55+
P50-­‐54
P35-­‐49
P25-­‐34
P18-­‐24
P12-­‐17
P2-­‐11
35%
of
pop
account
for
almost
half
of
all
Ome
spent
using
television
Source: NPOWER, Share of UE vs. Share of PUT – Total Day, 9/23/13 – 02/23/14
Universe
Es:mate
(000)
PUT
(000)

26. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
26
VIDEO
ON
DEMAND
ENABLERS
CONTENT
ACCESSIBILITY
INTERFACE

27. THE
NEW
ENTRANT:
SUBSCRIPTION
VIDEO
ON
DEMAND

28. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
28
SUBSCRIPTION
VIDEO
ON
DEMAND
DEFINED
Subscrip:on
Video
On
Demand,
[SVOD],
On
demand
video
content
made
available
to
consumers
via
internet
connected
devices
on
a
subscripOon
basis
(separate
from
MVPD
subscripOon).
Examples
include:
Ne1lix,
Hulu
Plus,
and
Amazon
Prime.

29. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
29
5%
Hulu
Plus
Amazon
Prime
8%
SUBSCRIPTION
VIDEO
ON
DEMAND
PENETRATION
1/3
of
U.S.
television
households
report
they
have
access
to
an
SVOD
service
Source:
NPower,
StaOsOc:
Percent
of
homes
with
SubscripOon
Video
On
Demand
access,
Interval:
10/13/2013
29%
Neclix

30. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
30
Broadband
only
TV
homes
88%
Broadcast
only
TV
homes
with
internet
49%
Cable
Plus
homes
with
internet
36%
WHICH
HOMES
HAVE
NETFLIX?
33.5
million
U.S.
homes
have
access
to
NeXlix
Source:
NPower,
StaOsOc:
Percent
of
homes
with
NeXlix
access,
Interval:
10/13/2013
TV
homes
29%

31. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
31
NETFLIX
COVERAGE
COMPARED
TO
NETWORKS
NeXlix’s
coverage
closely
aligns
with
that
of
U.S.
premium
pay
networks
Source:
NPower,
StaOsOc:
Percent
of
US
Televisions
households
that
receive
content,
Interval:
10/13/2013
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
TWC
USA
NICK
CNN
HIST
AMC
CMDY
ESPN
SYFY
VH1
TVL
CNBC
BET
Fox
Sports
1
InvesOgaOon
Discovery
OWN
MTV2
NBC
Sports
Network
FOX
Business
Network
INSP
WGNA
FUSE
FXX
H2
NKTNS
UP
MIL
DesOnaOon
America
TV1
SPRT
G4
FX
Movie
Channel
Encore
Encore
Primary
Fox
Sports
2
HBO
Prime
Starz
Primary
FOXD
Discovery
En
Espanol
NeXlix
29.0%

32. “RECENTLY
TELECAST”
VIDEO
ON
DEMAND
–
A
NEW
WAY
TO
DELIVER
PREMIUM
CONTENT

33. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
33
RECENTLY
TELECAST
VIDEO
ON
DEMAND
DEFINED
Recently
Telecast
Video
On
Demand,
[RTVOD],
On
demand
content
provided
by
MVPDs
that
is
taken
directly
from
the
live/
linear
airing
(including
same
commercials)
within
7
days
of
broadcast.
Viewing
credits
back
to
TV
raOngs
as
Omeshijed
viewing.
All
major
U.S.
broadcast
networks
and
most
cable
networks
now
make
their
content
available
via
RT
VOD
via
all
major
MVPDs.

34. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
34
VIEWERS
TEND
TO
BE
YOUNG
AND
UPSCALE
A
look
at
“Recently
Telecast
On
Demand”
viewers
Source:
NPower,
StaOsOc:
Percent
of
persons
p2+
that
watched
a
recent
program
either
live
or
on
VOD
and
reside
in
homes
with
the
corresponding
characterisOcs,
Interval:
October
2013
HOH
Age
W/CHILDREN
INCOME
8%
25%
18%
18%
38%
29%
HOH
Age
<
35
Presence
of
Chidren
HH
Income
>
$100K
Live
VOD

35. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
35
THE
PAYOFF:
ON
DEMAND
DELIVERS
THE
MESSAGE
ProporOon
of
the
commercial
raOng
to
program
raOng
for
a
U.S.
broadcast
network
Source:
NPower,
StaOsOc:
The
raOo
of
the
commercial
average
audience
against
the
program
average
audience,
Interval:
September
2013
(08/26/2013
-­‐
09/29/2013)
Live
95.1%
DVR
49.9%
VOD
96.8%

36. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
36
A
TIPPING
POINT?:
VOD
VS.
DVR
Source:
NPower,
StaOsOc:
Percent
of
total
program
and
total
commercial
playback
minutes
that
were
adributed
to
VOD
(p18-­‐24),
Interval:
October
2013
VOD
%
of
Non-­‐Live
Viewing
Viewing
of
commercial
minutes,
persons
18-­‐24
for
a
popular
new
acOon
show
VOD
%
of
Total
Viewing
22%
55%

37. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
37
POPULAR
NEW
ACTION
SHOW
COMMERCIAL
MINUTES
Source:
NPower
-­‐
NPM
Panel,
Interval:
Week
of
10/07/2013
P18-­‐24
66%
Homes
Capable
of
Viewing
NeXlix
VOD
%
of
Non-­‐Live
Viewing

38. KEY
ENABLERS
TO
SATISFYING
THE
VIDEO
APPETITE…

39. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
39
KEYS
TO
SUCCESS
FOR
VIDEO
ON
DEMAND
CONTENT
ACCESSIBILITY
INTERFACE
SUCCESS

40. Copyright
©2012
The
Nielsen
Company.
ConfidenOal
and
proprietary.
40
KEYS
TO
SUCCESS
FOR
VIDEO
ON
DEMAND
INTERFACE