The Internet discovers television, and the gold rush is on

Untapped potential gives providers, viewers, advertisers host of new options

Science & Technology

August 21, 2005|By David Hiltbrand | David Hiltbrand,KNIGHT RIDDER/TRIBUNE

Can't find anything to watch on TV? Try turning on your computer, where viewers' options are virtually unlimited.

With the phenomenal growth of high-speed Internet connections, more people are choosing their entertainment, news and sports by clicking a mouse, not a remote. The untapped potential of this market has set off a modern-day gold rush.

"All these different industries are in a mad scramble to control Internet television," said Pete Snyder, chief executive officer of New Media Strategies, an online marketing firm. "It's the biggest moneymaking portal of all."

How large has Internet television grown?

5 million people watched the Live 8 concerts, of which there were 10 around the world, from Philadelphia and five other cities last month on AOL.com.

The clip of Tom Cruise's June 24 meltdown on the Today show was downloaded 2.5 million times the week after it happened.

4.4 million people clicked onto MSNBC.com the day of the July 7 London terrorist bombings for continuous coverage.

Advertising on such "rich media" sites is projected to grow 60 percent this year.

"The attitude used to be that the Internet is the place to go for information," said Jeffrey Cole, director of the Center for the Digital Future at the University of Southern California. "It's changing to the notion that the Internet is the place you go to watch things."

All kinds of things.

On your computer, you can plug in to everything from the CN8 cable channel to stations from South Korea, from movie trailers to religious services, from Comedy Central to gavel-to-gavel coverage of Michigan's House of Representatives sessions. You can watch revelers on New Orleans' Bourbon Street or check the Otter Cam at the Monterey Bay Aquarium in California.

Some material is live, some is taped. Almost all of it is free.

If none of that appeals to you, there's always the option of creating your own channel with a Web cam and easy-to-use software.

"We've got this large community of independent broadcasters doing their own thing," said Fred McIntyre, vice president of AOL Video. "There are a lot of interesting personalities you won't see on network TV."

"With WinAmp [software], AOL has allowed users to create bootleg television stations," said Craig Stadler, CEO of East Bay Technology, which manufactures CTube, a popular video-content finder. "That's grown faster than anything I've seen in five years. A few months ago, it was a handful. Now there are hundreds."

CTube's downloadable software collects and organizes the bewildering plethora of streaming video available on the Web. AOL has just introduced a similar index/archive called Video Search, and several other such products are about to enter the market.

Live station on the Net

There is even a live commercial station that exists exclusively on the Net. ManiaTV.com is the brainchild of Drew Massey, a former magazine publisher who thought up a youth-oriented online channel in 1998 but held off on launching it until September.

"I basically waited for broadband to reach a critical mass of 20 million households," Massey said. "I knew that was how many households cable TV had when MTV launched." Now, broadband, high-speed Internet connectivity, has ballooned to 35 million households in this country, 100 million worldwide.

From a warehouse in Denver, a crew of energetic, amateurish cyberjockeys introduces a 24-hour mix of music videos, short films, cartoons and sports action clips designed to appeal to today's wired generation, who "live and breathe on the Internet," Massey said. "You talk to college people - they don't even have a television. This is where they spend all their time."

ManiaTV is not for couch potatoes. Multitasking is encouraged.

It's also an unusually interactive experience, with viewers messaging the cyberjockeys in real time.

"They can influence programming," Massey said. "A lot of times, as a music video is playing, people will start chatting, `This [stinks]!' `Yeah, this [stinks]!' And we kill it. They type, `Yeah! You killed it!' Who does that? What radio station kills a song in the middle of a spin?"

Young people were the earliest adopters of online media, going to sites such as Yahoo's Launch and AOL Music to watch music videos in large numbers in 2003. Faster connections meant that picture quality was markedly smoother and sharper than had been available through dial-up connections.

A May study by the Pew Internet Project found that 53 percent of all homes online had high-speed connections. As broadband has proliferated and the viewing choices have expanded (news is now the second most popular category; sports is third), the audience for Internet TV is growing somewhat older and more mainstream. But it still leans heavily toward the affluent, college-educated consumers whom advertisers crave.

Future of advertising

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