This article is a special report about the fifth annual On Demand Summit, which took place in New York City on May 8, 2013.
Just like Billboard has the most important charts in the music industry, and Nielsen has the most important charts in the TV industry, Rentrak has the most important charts in the movie industry.
Two Rentrak executives — Bill Livek (Rentrak vice chairman/CEO) and Cathy Hetzel (Rentrak corporate president/president of AMI division) talked about what people can expect from the company in 2013 and beyond. During a keynote interview with Multichannel News technology editor Jeff Baumgartner, the Rentrak executives gave their perspective of the on-demand side of the movie industry.
Livek said, “The two themes that I hear time and time again from people trying to sell products is that we’ve got a lackluster economy, and growth is occurring, but it’s occurring at a glacial pace. And their focus is how do they reduce the cost of new-customer acquisition and how do they reduce the cost of retaining a customer?
“And TV is at the top of their mind to do just that. And it’s not TV as we defined it in the last decade. It’s more TV as it’s being defined more around … on demand. They see an engaged customer, someone who is out there making decisions about whether it’s a TV show or a movie.”
Rentrak statistics were presented during this interview session. According to Rentrak, in the year 2012:
- There were 53 million U.S. households that had video-on-demand services.
- There were 9 billion on-demand transactions made by television.
- On-demand consumers spent an average of 8.5 hours per month with video-on-demand content.
- More than 78 percent of video-on-demand transactions were “free on demand” — at no extra cost to the consumer.
Livek noted that on-demand usage “has to be measured in a census-like way” and that Comcast’s purchase of NBC Universal (which began in 2012 and was completed in 2013) had a big influence on entertainment companies putting more content on demand. (Universal had five out of the Top 10 movies on demand in 2012.) The “free on demand” trend has shown the biggest growth because it is primarily the way that people catch up on TV shows.
When it comes to movies on demand (which usually are not free and involve an extra fee for consumers), the market is still dominated by major movie studios. Rentrak also reports that the majority of movies on demand are still watched on TV sets, not computers.
According to Rentrak, these were the Top 10 movies on demand in 2012:
1. “21 Jump Street” (Sony)
2. “The Hunger Games” (Lionsgate)
3. “Ted” (Universal)
4. “Marvel’s The Avengers” (Buena Vista)
5. “Safe House” (Universal)
6. “The Twilight Saga: Breaking Dawn — Part 1” (Summit)
7. “Moneyball” (Sony)
8. “Snow White and the Huntsman” (Universal)
9. “Tower Heist” (Universal)
10. “Contraband” (Universal)
Hetzel said that although on demand is often associated with people watching things on a TV screen or a computer, she said that on demand is really about “watching what I want to watch everywhere.” This includes mobile devices such as smartphones.
As for advertising for on-demand content, Hetzel noted, “The consumer is willing to watch the ad in order to get the programming on their own schedule on their own time.”
In Rentrak’s findings about the on-demand business worldwide, Hetzel said: “In the countries that we talked to so far, the content for their [overall] video on demand is much more centered on the Internet, and VOD TV tends to be for movies. That’s what we’re starting to see internationally, and we will move with the industry as it evolves around the world.”