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Broadcasters have 'no need to fear' video-on-demand

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By The Drum Team, Editorial

August 2, 2011 | 2 min read

While video-on-demand consumption is set to grow strongly, real-time linear broadcasting services will continue to account for over 90% of television viewing over the next five years, according to new forecasts from Enders.

That effectively means that the majority of people will continue to watch television in the manner they always have.

As a result, Enders forecasts that video-on-demand advertising will equate to seven percent of television's net advertising revenue by 2015.

The analysis company says current high prices for in-stream video ads will fall as it becomes more integrated with TV airtime sales.

Enders' predictions are backed by similar forecasts coming out of the US. Research from IHS Screen Digest TV Intelligence Service claims "the vast bulk" of consumer television viewing time will still be devoted to linear programming by 2015.

Digital video recorder, on-demand and other forms of nonlinear programming will account for 12.7 percent of television viewing in 2015, up from 7.8 percent in 2010, according to IHS. In the States it will be 15.8%.

The rise of nonlinear television has struck panic into the television industry, with broadcasters dreading the impact of new technologies on their revenue streams,” said Richard Broughton, senior analyst, television, for IHS.

“However, even in the leading countries for nonlinear television viewing—the United States and the United Kingdom—linear will account for the vast majority of television viewing through 2015. This means that for the television industry, DVR and on-demand viewing may not be as much of an imminent threat to profitability as feared.”

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