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Newsweek http://www.newsweek.com/id/45142

by Johnnie L. Roberts

New ways of getting video has shifted the peak times for viewing and advertising.

The job commute may be a daily headache for most, but it’s the favorite part of the day for Verizon Wireless. Why? Evening rush hour–4 to 7 p.m.–is prime time on its V Cast Internet service, when captive audiences in cars, buses and trains dial up a flood of streaming videos to while away the miles. Three to 5 p.m. is the peak of prime time for video at AOL. Time Warner Cable’s video-on-demand channels peak on weekends from 8 a.m. to 1 a.m. “It’s a terrific alternative to lackluster network-TV offerings,” says Bob Benya, the company’s chief of video on demand.

Broadcast television’s prime time as we know it is fading. Since the industry’s formative years in the 1950s, the powerful medium has revolved around initially four but now three nocturnal hours, from 8 to 11 o’clock. Mass audiences would settle in for appointment entertainment. Prime time dominated broadcast economics, produced memorable pop-culture moments (Who shot J.R.?) and, as the broadest forum for advertising, propelled modern consumer society. But in a media landscape now increasingly aglow with online video, prime time is essentially any time. Empowered by the Internet and digital video recorders, massive numbers are resetting their TV clocks. Viewership is beginning to spike during daylight hours, when videos are streamed or downloaded to office computers, laptops, iPods and cell phones. Daytime, says reality-TV king Mark Burnett, is “the new prime time.”

Industry experts say these changes could affect, among other things, scheduling, programming and ad pricing. NBC acknowledged prime time’s shifting nature just last week. The network, which is trying to dig out of fourth place, announced plans to air more cheaper-to-produce reality shows and games at 8 p.m. in place of costly sitcoms and dramas. “Nobody can afford three hours of expensive prime-time programming,” Jeff Zucker, CEO of NBC Universal, told NEWSWEEK, expressing a view his rivals dismiss. And with the rise of streaming and downloaded video, he added, network execs must stop counting only viewers who catch a show at, say, 9 o’clock on NBC and start noting “how many watched it in all of its incarnations.”

That number is in the millions. In just 10 days recently, Burnett’s reality series “Gold Rush” generated 7 million streams at AOL, its exclusive home. The peak hour: 4 p.m. That would make it a respectable hit on television. NBC.com counted 2 million streams of the network’s new prime-time shows, including “Heroes,” in the first week of making them available online. Daytime streaming on PCs accounts for the vast majority of all Internet video. Some 70 percent of streaming at home is done when the sun is out, and more than eight of 10 videos at work stream during daytime, according to data prepared for NEWSWEEK by comScore, a digital measuring service.

Although the networks’ share of primetime audiences has been shrinking since the rise of cable, roughly half of all television homes still tune in between 8 o’clock and the late local newscast. And at least $9 billion of ads air then. Yet every major broadcast network hastens to note that the audience for a show generally grows once the programming is made available for digital streaming. Like its rivals, CBS streams its prime-time hits, including “CSI” and “Survivor,” on its Innertube site. But speaking at an industry gathering last week, CBS Entertainment president Nina Tassler said that prime time remains the “epicenter” of CBS’s programming. “Prime time isn’t going away, it’s just being redefined,” says Mike Bloxham, director of insight and research at Ball State University’s Center for Media Design.

Noon has been pinpointed as the absolute peak of Internet prime time. “Noon is when everyone feels liberated to indulge,” says Hunter Walk, product manager of Google Video, which soon will be bolstered by Google’s $1.6 billion purchase of YouTube. Is streaming the new coffee break? Or is the office audience merely downloading and transferring videos to portable devices to watch later? Either way, experts are identifying an emerging pattern dubbed “session viewing,” says Bloxham. “People are stockpiling and watching a number of episodes in a row.” The trend may be the final stake in the heart of television as a communal experience.

Not everyone buys into the notion of a new prime time. Some network executives won’t even acknowledge peaks in online viewing. Others believe that any notion of prime time will vanish as the market continues to expand and viewing patterns flatten across the entire day.

Although raw counts of video streams are available from third-party Web-measuring services, video sites are just beginning to determine the makeup of their audiences. The industry will make huge leaps next year in “breaking down the audience and at geographic and demographic targeting,” says Kevin Conroy, a top AOL exec. “No one thought the [online video] market was going to happen so fast.” AOL and others aren’t completely in the dark. Everyone knows, for example, that office workers account for most of the streams, and the majority are 18 to 34 years old. “People have [Web] access at work, where it’s really truly high-speed,” says Greg Stewart, CEO of the Interactive Advertising Bureau.

Video services say programming, scheduling and ad sales could change a lot as a result of emerging viewership patterns. Audience data, says CBS digital chief Larry Kramer, “will enable us a year from now to sell ads more strategically.” We can’t wait.

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