Online video is growing ever more popular, particularly in the United States. But it’s YouTube which continues to drive market penetration, with Hulu leading the rest of the growing pack.

Online Video Viewer Stats

Online video is showing no signs of slowing down in growth. As the latest comScore statistics for December 2009 show.

178 million Internet users in the U.S. watched online video during the last month of the decade. Which equates to almost 87 percent market penetration.

Between them they watched over 33 billion videos in December, or the equivalent of 187 videos each. The average length of video now stands at 4.1 minutes, up from 3.5 minutes around the same time last year.

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There’s a definite feeling that Microsoft is bouncing back after a dismal last few years which saw Bill Gates leave the company and Windows Vista hit the shelves. Windows 7 is now with us, its Bing search engine is competing with Google, and the company is also making efforts with online video.

Microsoft Returns

Microsoft is doing all it can to replenish its tarnished reputation. The release of Windows 7 is huge, and Bing is a search engine which may actually manage to provide competition for the ubiquitous Google.

Silverlight 3.0 is obviously proving popular with media companies seeking to stream video over the Internet but 2009 has also seen a few changes take place in terms of Microsoft’s approach to online video.

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Ashley Highfield claims the television industry has three years to act before it faces an “iTunes moment” with Apple running the online video show.

Is this correct or is the Microsoft executive who also launched the BBC iPlayer merely showing his anti-Apple bias?

Ashley Highfield

Ashley Highfield is a man who knows what he’s talking about when it comes to consumer technology and online video. He formerly oversaw the launch of the BBC iPlayer service, initially only on Windows, and was the CEO of Project Kangaroo, the joint venture between the BBC, ITV, and Channel 4.

He is now the UK Managing Director of Microsoft (Consumer & Online) and looks after Windows, Bing, Messenger, Hotmail, and more besides. He also oversaw the launch of the MSN Video Player recently, which brings archive television shows to the Web.

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The Xbox 360 is winning the fight for consoles to become important cogs in the online video sector. And a set of new Netflix features rolled out on the Xbox 360 have coincided with a promise that Netflix will not be coming to PS3 or Wii any time soon.

Netflix On Xbox 360

Xbox 360 owners gained access to Netflix’s ‘Watch Instantly’ video-on-demand streaming service last November with the roll-out of the long-awaited New Xbox Experience. This gave Xbox Live subscribers access to the 12,000-plus movies and television episodes Netflix gives away to its subscribers.

This was just the latest step in the evolution of video games consoles from being meant just for games to becoming true multimedia devices designed as living room entertainment hubs.

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It was only announced last week but the MSN Video Player has now gone live. Is it worth watching? How does it compare to the BBC iPlayer and Hulu? Read on for a full review of Microsoft’s online video streaming service.

Competition For BBC iPlayer

The online video streaming sector in the UK is suddenly exploding, perhaps fueled by the popularity of the BBC iPlayer or perhaps because online video has finally gone mainstream in a big way. The iPlayer continues to dominate but in the aftermath of the decision to quash Project Kangaroo, competition is increasing.

Arqiva has bought the technology behind Kangaroo and plans to use it to launch an online video streaming service within months. Then there is Hulu, the free premium video service in the States which has plans to move into other territories, with the UK being first on the agenda. Hulu UK is therefore likely to become a reality in a few months time.

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With the collapse of Project Kangaroo, I assumed online TV in the U.K. would be limited to the BBC iPlayer for a long while to come. However, that doesn’t seem to be the case, with the competition hotting up. The latest contender is Microsoft, which today launched its MSN Video Player.

The BBC iPlayer And…

The BBC iPlayer is a brilliant service, and one which I have used on a weekly basis since it first launched at the end of 2007. But, as good as it is, it is obviously limited to new episodes of BBC shows. And competition is always good.

That’s the view the Competition Commission took when it ordered Project Kangaroo, a joint project between the BBC, ITV, and Channel 4, to be shut down before it had even got started. And the decision left British viewers with little choice in the online video market.

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YouTube has seen off another contender to its throne, with Microsoft preparing to kill off Soapbox, or at least substantially shutter the user-generated portion of the site. If even Microsoft cannot hope to compete, is YouTube too dominant for the health of the online video sector?

No To YouTube, Yes To Soapbox

Before Google spent $1.65 billion acquiring YouTube in 2006, Microsoft was thought to be interested in buying the site itself. When Google got there first, Microsoft issued a statement saying that while it had “evaluated acquiring this type of technology several months ago” it had decided against it. Instead it was going to build its own video-sharing Web site as this was “a more cost-effective way to compete in this new space.”

That service was named Soapbox and was launched in a private beta by the end of that same year. It launched fully in 2007, and was clearly a YouTube clone. The only real difference being its approach to copyrighted material. While YouTube leaves the discovery of this content to the copyright holder, Microsoft took the task on itself.

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