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Consumers Choose Ads Over VOD

Sixty-two percent of consumers prefer free on-demand TV programs with commercials rather than VOD programs without commercials that cost $1.99, according to new research from Points North Group and Horowitz Associates. Seventeen percent would choose to pay $1.99 without commercials. Twenty-one percent are undecided.

For consumers aged 18-34, 68 percent want free, ad-supported versus 26 percent favoring pay, and only 5 percent undecided.

The research seems to contradict CBS surveys that showed average TV viewers would purchase about 100 hours of VOD programming per year.

 

“Video downloads for $1.99 will have limited appeal. Consumers will grow tired of having their credit cards charged $1.99 every time they download a rerun of CSI,” said Craig Leddy, a Points North Group analyst.

Leddy cautioned that any advertising must fit the unique characteristics of on-demand video, the Internet, and portable devices and not impede consumers’ viewing experience. “In time, consumers will see a mix of free, ad-supported, pay-on-demand and subscription options.”