Television has always been traditionally distributed by cable or satellite systems, but now a new pretender to the throne to be the media of choice has stormed in and broken the party up.

Internet television or IPTV uses the Internet to deliver video from a source to a target device such as a Web browser or set-top box.

Joost, VeohTV, WiTV, Babelgum and, most recently, Microsoft Internet TV are some of the prominent players jostling for market share in this rapidly emerging space. 

Additionally, sites such as YouTube Mobile and MySpace TV, two top online destinations, will continue to drive traffic and generate demand for online/mobile video consumption.  (Brightcove has a good summary of why Internet TV matters.)

The recent public beta of Joost, a raising star in this space, has generated a fair share of media coverage about the realities of Internet TV.  

From Traditional TV to Internet TV

The big question: Is the promise of high quality and snazzy user interface enough to pry eyeballs from traditional TV to Internet TV?  

Neither Brad Stone at Bits nor our own Michael Garrett seem impressed with Joost—citing bandwidth problems, overloaded P2P architecture, and general lack of incentive for users to interrupt Web browsing to watch Internet TV.

Liz Gannes at NewTeeVee posted a great video interview with CEO Mike Volpi who noted that Joost is targeted at the early adopters, not the mainstream TV consumer.

This is fair commentary from the end user perspective. There is a feeling at Ripcode that Internet TV has already made significant inroads in capturing television eyeballs.  

Hard To Ignore Metrics

The fact that a user-submitted YouTube parody on Britney Spears can secure over 10 million views in less than two weeks, thus rivaling the viewership metrics on an average prime-time television program, is a phenomenon that is hard to ignore. 

The Conference Board and TNS reported last week that more consumers are watching TV online.  Report highlights include:

• Close to 16 percent of American households who use the Internet watch television broadcasts online.
• Three out of five respondents say that watching TV online is just more convenient, while one third say they go online to avoid watching commercials.
• Streaming and free downloads are the top methods for viewing TV online.
• Respondents said that TV on the Internet has replaced news programs as their most widely viewed online content.

Mainstream Acceptance Of Internet TV

And In-Stat has published a report in the last few weeks titled Trends Favor Mainstream Acceptance of Internet TV.  In the press release announcing the report, the In-Stat summary states that overall:

• Respondents to an In-Stat survey felt online video will become more mainstream over time
• Social networking aspects are starting to play an important part on how the newer generation wants to watch and interact with TV.
• Primary detractors for online video continue to be download speed, user interface, cost, and quality of video

We could not be in more agreement with these findings.  Feedback from our customer engagements confirms the same trends.  Social networks and search engines in particular appear to be gaining viewership at a faster rate than most other models.  

How Will Traditional TV Counter?

The question will be, how long will it take for the traditional channels to generate a counter solution to the rapid growth of Internet TV?

The rapid change and uncertainty in Internet TV and how the traditional television markets will respond is the key to Ripcode’s business model. 

In just about every possible outcome, the resultant business model will require significant transcoding to accomplish the task of combining traditional television viewership with the Internet experience.  

In addition, as these two worlds collide, the resultant combination of video libraries only fuels the need for the On Demand Transcoding℠ methodology.

Originally written by Brendon Mills of the RipCode Blog. RipCode offers on-demand video transcoding solutions to ease the process of re-purposing video into multiple viewing formats.

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