Interesting VOD stats out from Rentrak this week. Among the operators Rentrak surveyed, VOD orders were up 43% in 2007 over 2006, with an increase of 29% in the number of unique set-tops accessing on-demand content. (The numbers don’t include “adult” content.) Most of the orders were for free programming, but that doesn’t seem to be slowing operators or network executives down in promoting their VOD services. In an article by Craig Kuhl over at Multichannel News, it’s clear from a few of the quotes that the goal is to hook viewers on programming available on-demand and then transition them to linear broadcasts for new episodes of their favorite shows. At least that’s the goal until targeted advertising is widely deployed.
Making an educated guess, I bet the VOD growth rate will increase even further in 2008 than it did in 2007. Here’s why:
- Many operators are converting to all-digital, meaning a large and growing percentage of set-tops in 2008 are capable of supporting VOD services.
- There is more VOD content available. Back in January, Comcast promised there would be 6,000 on-demand movies made available in 2008 as part of Project Infinity.
- There is more really good VOD content available. Not only are the Olympics coming to on-demand, but operators are showing more and more early-series episodes of great shows in advance of fall premieres. (That’s how my brother got hooked on Mad Men.)
As VOD continues to grow, one of the key things operators have to pay attention to is how to scale both streaming capacity and storage capacity effectively. On-demand television is a completely different technology model from live broadcast, and it demands a lot more from the network delivery systems.