Video Usage Online Spiking

According to a report released by Nielsen late last week, overall online video usage, measured as time per user, rose in May to 188.7 minutes for an annual growth rate of 48.9 percent over May 2008. That would be over three hours of online video viewing by the 133,797,000 users in the U.S., up 12.8 percent from a year earlier.

Nielsen also reported that the total video streams watched during those three hours+ per month was 75.1, which would imply that the average online video runs about two-and-a-half minutes. That sounds right; most online videos are short, and YouTube caps them at ten minutes.

Speaking of YouTube, it still is far and away the online video destination of choice. Here is Nielsen’s breakdown of unique viewers (in millions):

YouTube 95.4

Yahoo 25.2

Fox Interactive 16.0

MSN/Windows Live 12.5

Hulu 10.1

The next five players (Turner, MTV, CBS, ABC, and Nickelodeon are tightly clustered with under 7 million viewers each. (If you are wondering why these totals add up to more than 133.8 million, it’s because many users visit more than one destination to view videos each month.)

YouTube’s dominance is also reflected by the quantity of material hosted by each site. Compared to YouTube’s inventory of over six billion videos, the next biggest repository, Hulu, only has 382,000+, one-fifteenth that of YouTube.

Of course, as many of us have been askeing for some time now, what good is all that inventory if YouTube cannot monetize it? Only about three percent of the videos on the site carry advertisements, mainly because of the myriad of intellectual property rights issues that limits the company from profiting from their use. On the other hand, entrepreneurs are making some impressive money off their own videos via the site.