Q VIDEO. INDEX TV is no longer a single screen in your living room.

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1 TV is no longer a single screen in your living room.

2 A MESSAGE FROM OOYALA Change often comes very slowly, but then happens all at once. David Carr hit the nail on the head when he wrote about the evolving media landscape in the New York Times this April. Data from Ooyala s Q1 Global Video Index reveals the key trends that are fundamentally transforming linear television into an online, mobile experience. The visions that have been promised for years are, in fact, coming to life today across all screens. In the first quarter of 2013, millions of online viewers tuned in as a retiring pope livestreamed his final day in office, and saw Twitter transform itself from a micro-blogging to a micro-video service with the launch of Vine. In America, office productivity deflated as March Madness highlights streamed live across the major social networks, Netflix minted their first original hit with House of Cards, and ad dollars followed viewers online when more than 13 billion video ads were viewed for the first time ever, according to comscore. Our findings reveal that live video continues to dominate on-demand content in terms of viewer engagement. Desktop viewers watched live video 13 times longer than VOD last quarter. Tablet and mobile video also broke new records, and accounted for more than 10% of all online video plays for the first time in Q1. We re also shining a spotlight on the Asia Pacific region, where we see many new and innovative media experiences taking shape among broadcasters, content owners and multi-service operators Of course, there are still many challenges to overcome as traditional media companies and technology firms continue to make sense of and profit from digital media. But as our data reflects, TV and online video converge more every quarter. More studios and networks are going direct to consumers with free, pay-per-view or authenticated online programming. And Netflix and other streaming media companies are creating more TV-like content every day. In the U.S., congress will consider legislation that challenges TV providers to unbundle expensive content packages in favor a la carte offerings. In the end, measurement remains one of the most important factors in the video equation. Ooyala is committed to building the best online video analytics on the market. This report is only one example of how information can be turned into powerful insights to help deploy a winning digital video strategy. As always, thanks for watching! SUDHIR KAUSHIK Director of Products, Insights and Optimization, Ooyala

3 Table of Contents About Ooyala s Video Index...4 Executive Summary...5 Share of all time played: Mobile + tablet...6 Live, VOD time per play by device...7 Time watched by video length and device...8 Viewer engagement by device...9 Spotlight on APAC...10 Spotlight on APAC: Live, VOD time per play by country...11 Spotlight on APAC: Long-form video viewing on all devices...12 Spotlight on APAC: Viewer engagement by country...13 Turning Information Into Insights...14 Data Tables...15 Methodology...18 Glossary...19 Disclaimers & Assumptions

4 About Ooyala s Global Video Index OOYALA DATA SCIENCE Ooyala Data Science is a cross-disciplinary team including several PhD-level researchers devoted to the analysis of vast amounts of data on video content performance, viewer engagement, and monetization. Advanced Data Science is an integral part of the value Ooyala provides through its analytics solutions. This core team builds technology that enables the conversion of billions of analytics events occurring each day into actionable insights that help companies optimize both viewer experience and revenue opportunity. Ooyala s long-standing commitment to Data Science is key to creating value for customers whose success depends increasingly on the need for better measurement and analysis of IP-delivered video. ABOUT OOYALA PUBLISHERS Ooyala video publishers include hundreds of forward-thinking brands, broadcasters and operators like Bloomberg, ESPN, Telefonica, The Food Network U.K., Rolling Stone, Miramax, Pac-12 Networks, Sephora, Caracol TV, CJ Entertainment, and Yahoo! Japan. This report reflects the anonymized online video metrics of these publishers. It does not document the online video consumption patterns of the Internet as a whole. But the size of the Ooyala video footprint, along with the variety of our customers, means this report offers a statistically representative view of the overall state of online video. ABOUT THE GLOBAL Ooyala measures the anonymized viewing habits of nearly 200 million unique viewers in 130 countries every month. We process billions of video analytics events each day. Our market-leading video analytics help media companies and consumer brands grow their audiences and earn more money from mobile, multi-screen broadcasting. Ooyala works with TV networks, cable and satellite providers, movie studios and online media. 4

5 Executive Summary Key findings from Ooyala s Global Video Index include: TABLET, MOBILE BREAK NEW VIEWING RECORDS Taken together, the share of tablet and mobile video grew 19% in. Mobile and tablet video now account for more than 10% of all online video plays, the most ever recorded in Ooyala s Video Index. LIVE DOATES VOD ON ALL DEVICES Globally, desktop viewers watched live news, sports and special events for an average of 40 minutes per play in. On average, people streamed live video on smart TVs and gaming consoles for 45 minutes per play last quarter 9X longer than VOD. Desktop viewers watched live video 13X longer than VOD last quarter, tablet video viewers watched live video 4X longer, and mobile audiences tuned in to live video 3X longer. LONG-FORM Both mobile and tablet video viewers spent more than half of their total online viewing time watching long-form videos* last quarter. 25% of total tablet viewing time was spent with content more than 60 minutes long in Q1. *Videos longer than 10 minutes long. SPOTLIGHT ON: APAC Premium, Long-Form Video Content - APAC Viewers in Singapore, Hong Kong, Japan and Thailand spent more than one-third (33%) of their total online viewing time watching videos longer than ten minutes last quarter. LIVE VS. VOD APAC In Singapore, Hong Kong, Japan and Korea, viewers watch live video 20X longer than on-demand video, across all device types. This is nearly double the global ratio of live vs. on-demand content during the quarter, which is approximately 12 to 1 across all devices. MOBILE + TABLET As more mobile screens penetrate the market, and more content becomes available online, the way people watch TV continues to evolve into a mobile, multi-screen experience. Ooyala s data shows that the total share of tablet and mobile video grew 19% in. This is similar to the pace we saw in 2012, when the share of mobile and tablet viewing doubled between January 1 and December 31. Tablet + Mobile Video: Share of All Time Played - 5

6 Share of all time played: Mobile + tablet 11% 10% 9% 8% Share of all time played online 7% 6% 5% 4% 3% Mobile + tablet video As more mobile screens penetrate the market, and more content becomes available online, the way people watch TV continues to evolve into a mobile, multi-screen experience. Ooyala s data shows that the total share of tablet and mobile video grew 19% in. This is similar to the pace we saw in 2012, when the share of mobile and tablet viewing doubled between January 1 and December 31. Taken together, mobile and tablet video now account for more than 10% of all online video plays. The share of tablet video viewing grew 33% in. 6% 5% 4% 3% 2% 1% 0% Tablet Mobile January February March 2% 1% TV is no longer a single screen in the living room. Video publishers who fail to deliver and monetize mobile content on tablets and smartphones are leaving digital dollars on the table. 0% January February March 6

7 Live, VOD time per play by device When we compare live online video engagement rates to VOD viewing times across devices, we see that connected audiences consistently tune in to live streaming media for longer periods of time. Live, VOD time per play by device Desktop viewers watched live video 13X longer than VOD last quarter, while tablet viewers tuned in to live content 4X longer. Connected TVs & Gaming Consoles saw an average live video viewing time of 45 minutes. 45 CTV & GC DESKTOP Breaking news, live sports, and special events have an inherent immediacy that hooks connected viewers and leads to longer viewing times across all devices. 40 To grow their audiences, publishers must be able to deliver live streaming media to all screens. Inserting live ads is key to monetizing live online content. 8 TABLET 16 MOBILE Live time per play VOD time per play 7

8 Time watched by video length and device People watch video differently on different devices. We ve written before about how factors such as screen size, location, and lean-back vs. lean-forward mentalities contribute to different online video viewing experiences. A few years ago, the industry was skeptical that people would ever watch long-form content on mobile devices. Our statistics show that fact they are: when measuring content of at least 10 minutes in length, 40 percent of that content viewed on smartphones was made up of videos at least 30 minutes in length. It stands true that the larger the screen, more likely it is that video views are with long-form content but mobile is not to be dismissed as a format for premium, feature-length video. These charts show the share of time spent watching streaming media in the first three months of 2013, broken down by content length and device type. Mobile long-form video viewing increased 29% YoY growing from 41% of all time watched in Q to 53% of all time watched in. It s no longer enough to know how many plays a piece of content has. With viewers tuning in to their favorite long-form premium programming on all connected screens, video publishers have more opportunities to place targeted mid-roll ads within their content. Savvy media publishers will use cutting-edge video analytics to understand and monetize plays on different device types. Time watched by video length and device Long-form viewing by device Less than 1 minute 1 3 minutes 3 6 minutes 6 10 minutes min min 60+ min More than 10 minutes 3 % 14 % 71 % CTV & GC 7 % 5 % 53 % 4 % 6 % MOBILE 21 % 15 % 5 % 7 % 22 % 52 % 38 % 15 % 6 % 8 % 22 % TABLET DESKTOP 25 % Percentage of time spent watching 30% 25% 20% 15% 10% 5% 0% CTV & GC MOBILE TABLET DESKTOP Both mobile and tablet video viewers spent more than half of their total video viewing time watching long-form videos last quarter. For tablets, 25% of all viewing time is spent with content more than 60 minutes long. 8

9 Viewer engagement by device 69 % 63 % 58 % 47 % 72 % 64 % 56 % 42 % CTV & GC TABLET 63 % 55 % 48 % 38 % 60 % 53 % 47 % 33 % DESKTOP MOBILE Viewer behavior and engagement When we look at global engagement rates across device types, several patterns begin to emerge. Mobile and desktop engagement was strikingly similar last quarter. Almost half of the people who start viewing a video on these devices make it to the third act (75% through). Larger screens on tablets and Connected TVs & Gaming Consoles yield higher engagement rates. Tablets are the new TV, with highly engaged audiences consuming content and offering more opportunities for mid-roll monetization. 9

10 Spotlight on APAC Streaming media presents broadcasters, brands, agencies, and advertisers with a global opportunity to build loyal, engaged audiences around the world. The Ooyala Data Science team analyzed several key engagement metrics to see how people are watching video online in the Asia-Pacific region. Our study includes Japan and India for the first quarter of It s important to note that the three key factors of content, context and audience play into regional differences in viewer engagement. But taking those variables into account, there is much to be learned about maximizing revenue opportunity from analyzing how viewing patterns shift across international borders. 10

11 APAC Live, VOD time per play by country 52 SINGAPORE 49 JAPAN 49 KOREA 44 HONG KONG 42 AUSTRALIA 42 INDONESIA Live time per play VOD time per play 40 MALAYSIA TAIWAN 29 NEW ZEALAND 25 PHILIPPINES 25 VIETNAM 24 INDIA 20 APAC: Live video consistently dominates VOD engagement CHINA 17 Singapore, Hong Kong, Japan, and Korea all watch live video* at least 20X longer than they do VOD content. This is nearly double the global ratio of live vs. on-demand content during the quarter; which was approximately 12 to 1 across all devices. In every APAC country sampled, the average time per play for live video was longer than 15 minutes. Over half the countries sampled last quarter viewed live video for longer than 30 minutes per session. Singapore leads the region in time per live play, with an average live viewing session of 52 minutes. If you want to engage international audiences, you need to deliver live video to all four screens, with a smart combination of engagement and ad analytics to maximize the revenue opportunity. *Live video is defined as coverage of an event that is streamed either as it happens (e.g. a sporting event, music concert or other ad hoc event) or as it is broadcast on another medium (e.g. a live linear TV channel). 11

12 APAC Long-form video viewing (all devices) APAC: Long-form viewing CHINA 20 % KOREA 42 % JAPAN 34 % In APAC, long-form video* viewing patterns vary from country to country. Long-form video viewing accounted for 45% of the total time spent watching video online in Malaysia last quarter. Viewers in Singapore, Hong Kong, Japan, Korea, and Thailand spent more than one-third of their total online viewing time watching videos longer than ten minutes, across all device types. INDIA HONG KONG 30 % 35 % PHILIPPINES 32 % THAILAND 36 % MALAYSIA 45 % SINGAPORE 37 % VIETNAM 13 % Connected audiences in APAC enjoy watching premium, long-form content online. This represents a significant opportunity for increased monetization via mid-roll ad insertion. INDONESIA 25 % AUSTRALIA 20 % NEW ZEALAND 29 % *Videos longer than 10 minutes. 12

13 81 % 74 % 69 % SINGAPORE 57 % APAC: Viewer engagement by country Viewers in Singapore were the most engaged last quarter, with 57% viewing online videos to 100% completion. Hong Kong, Malaysia, Japan, New Zealand and the Philippines were among the countries that had the highest levels of engagement in the region last quarter, as measured by the average level of completion for videos played. Additionally, in all regions except Australia, the likelihood that a viewer completes a video after watching the first 25%, is over 80 percent. In Australia that likelihood is 60%. Engagement patterns vary by region and country. Using real-time analytics to understand how your audience consumes content helps increase views across all connected screens. APAC Viewer engagement by country 81 % 73 % 67 % 57 % 79 % 73 % 68 % 55 % 77 % 69 % 65 % 54 % 78 % 70 % 63 % 50 % JAPAN MALAYSIA NEW ZEALAND HONG KONG 75 % 67 % 62 % 49 % 72 % 63 % 56 % 44 % 72 % 62 % 55 % 43 % 64 % 55 % 48 % 41 % PHILIPPINES AUSTRALIA THAILAND INDIA 65 % 57 % 52 % 40 % 69 % 57 % 49 % 38 % 56 % 46 % 40 % 30 % 54 % 44 % 37 % 28 % KOREA CHINA INDONESIA VIETNAM 13

14 Turning Information Into Insights When you optimize digital revenue strategies for each viewer, device and location, you deliver more relevant ads to the right screen at the right time. The result is more money for online video publishers. Ooyala uses Big Data and real-time video analytics to help you understand your audience like never before, and connect with them in meaningful ways. Only Ooyala delivers a more personalized and profitable media experience that benefits viewers and content publishers alike. That is the power of information. That is the power of Ooyala. 14

15 Data tables Share of Time Played - Tablet Mobile Tablet+Mobile Jan 7, % 4.23% 8.54% Jan 14, % 3.35% 8.03% Jan 21, % 4.36% 9.77% Jan 28, % 4.35% 9.14% Feb 4, % 4.50% 9.55% Feb 11, % 4.42% 9.45% Feb 18, % 4.98% 10.29% Feb 25, % 4.55% 9.78% Mar 4, % 5.00% 10.36% Mar 11, % 4.84% 10.27% Mar 18, % 4.45% 9.76% Mar 25, % 4.51% 10.20% Time Per Play - VOD Time Per Play (Minutes) Live Video Time Per Play (Minutes) Desktop Mobile Tablet CTV & GC Time Watched by Video Length and Device - Desktop Mobile Tablet CTV & GC Less than 1 minute 1 minute to 3 minutes 3 minutes to 6 minutes 6 minutes to 10 minutes 10 minutes to 30 minutes 30 minutes to 60 minutes More than 60 minutes More than 10 minutes Less than 10 minutes 6.78% 3.88% 4.68% 3.19% 25.23% 21.48% 21.86% 13.90% 21.55% 15.15% 14.84% 6.90% 8.30% 6.48% 6.80% 4.94% 10.07% 12.36% 9.64% 18.26% 15.68% 22.53% 17.11% 29.31% 12.37% 18.12% 25.07% 23.51% 38.13% 53.00% 51.83% 71.08% 61.87% 47.00% 48.17% 28.93% 15

16 Data tables Percent of Long Form Video Views by Device Desktop Mobile Tablet CTV&GC Q Q Q Q % 41.1% 46% 88.5% 62% 48% 67% 93% 59.9% 47.6% 71.2% 93.8% 57.0% 43.6% 63.0% 81.7% Viewer Engagement by Device - 25% 50% 75% 100% Desktop Mobile Tablet CTV & GC 63.10% 54.52% 48.47% 38.31% 60.45% 52.91% 46.90% 33.38% 72.91% 64.34% 56.22% 41.50% 68.81% 62.73% 57.73% 47.19% APAC Live, VOD Time Per Play By Country - VOD Time Per Play (Minutes) Live Time Per Play (Minutes) Live/VOD AU CN HK ID IN JP KR MY NZ PH SG TH VN

17 Data tables APAC Long-Form Viewing - All Devices - AU CN HK ID IN JP KR MY NZ PH SG TH VN More than 10 minutes 20.22% 19.66% 35.34% 25.47% 30.18% 34.00% 41.53% 45.36% 28.64% 32.36% 36.89% 36.41% 13.11% APAC: Viewer Engagement by Country - 25% 50% 75% 100% AU CN HK ID IN JP KR MY NZ PH SG TH VN 72.63% 63.38% 56.07% 43.81% 69.08% 57.15% 49.48% 38.48% 77.52% 69.54% 62.53% 49.62% 56.33% 46.12% 39.66% 29.97% 64.17% 54.79% 47.80% 41.36% 81.24% 73.06% 66.59% 56.72% 65.44% 57.06% 51.97% 40.45% 79.32% 72.85% 68.04% 55.05% 77.31% 69.48% 64.58% 53.60% 74.78% 67.42% 62.40% 49.09% 80.50% 73.72% 68.64% 57.19% 71.97% 62.22% 54.62% 42.98% 53.89% 44.11% 37.34% 28.28% 17

18 Methodology The data sample used in this report covers the first quarter of 2013, from January 1 through March 31. All data was taken from an anonymous cross-section of Ooyala s global customer and partner database an array of broadcasters, studios, cable operators, print publications, online media companies and consumer brands. These firms broadcast video to over 130 different countries from more than 6,000 unique domains. Nearly 200 million unique viewers watch an Ooyala-powered video every month. This data sample is not intended to represent the entire Internet, or all online video viewers. DATA COLLECTION Ooyala s video analytics technology collects all anonymized video data in real time. During playback, Ooyala s video player gathers information continuously and relays it to an analytics module, which then stores the data in a distributed file system, Hadoop. Viewer statistics are then compiled and stored in a Cassandra data cluster, where the information is made readily available for analysis. ANALYSIS AND METRICS Ooyala s video analytics module tracks a range of standard variables, such as: Displays, plays and time watched Viewer engagement and video completion rates Sharing by social network Geography (region, state, city, Designated Market Areas) Device type (mobile, desktop, tablet, connected TV devices and game consoles) Operating system (Windows, Android, ios) Browser (Safari, Chrome, Firefox, Internet Explorer) 18

19 Glossary CONVERSION RATE The ratio of plays to displays. 10 displays with 1 play is a conversion rate of 10%. COMPLETION RATE The rate at which viewers watch a specified portion of a given video. Sometimes used interchangeably with play-through rate. DISPLAY Each (and any) time a video is loaded in a browser and displayed to the viewer. LIVE An event that is streamed either as it happens (e.g. a sporting event, music concert or other ad hoc event) or as it is broadcast on another medium (e.g. a live linear TV channel). MOBILE DEVICES All smart phones, including ios, Android, Blackberry, and others. PLAY Each time a video starts playing. TABLETS All media tablets, including ios and Android. 19

20 Disclaimers & Assumptions Data is not aggregated across all videos or providers for vertical data, and only publishers with a meaningful amount of videos watched are included. Publishers with incomplete data have been excluded. When selecting items for inclusion in the report, Ooyala s data science team selected metrics that were clear and meaningful. Granular measures were broken down along many categories, which resulted in a large amount of data. Rather than reporting all of this data, the Ooyala team chose to highlight those measures that give a good impression for the data set as a whole. 20