The Diffusion Group has released a report that predicts Internet video will surpass broadcast TV programming by 2020.
The market research firm points out that broadcast television has remained fairly stable in recent years, while Internet video watching has increased by 84% from 2008 to 2009. The company forecasts a rapidly increasing rate of growth, coming at the expense of broadcast television. The co-author of the report predicts that “Internet and broadcast delivery of video content will become blended in such a way that consumers will be unaware of which conduit serves which content.”
Now, let me point out that a small decrease in the majority share is a small percentage, but an equally small increase in a minority share can look enormous. In this case, they are holding the total number of TV viewing hours constant, so the change in broadcast versus Internet will be the same. This means that the 84% growth figure is probably not all that exciting since it’s starting with such a low number. The curves in the forecast graphs are pretty flat initially, and then accelerate rapidly starting in about four years.
I believe that the overall conclusions are probably valid, if not pessimistic. The current network/broadcast/cable/satellite model is under enormous strain, as is the mass-advertising model on which they have been built. We may not have to wait until 202o to see the current system collapse, resulting in a new model that consists of separate content producers, content distributors, and broadband bandwidth providers. Individually-targeted advertising and content developed for smaller audiences will transform what we watch and how it gets delivered to us. Certainly there will continue to be mass-market blockbuster shows and movies, but these will likely become the minor portion of the available content that we’ll watch in our living rooms.