Video Streaming on Game Consoles on the Rise
Streaming video on game consoles is up over last year, according to Nielsen. An October survey reveals that streaming and video-on-demand represent a larger weekly share of usage on Microsoft Xbox 360, Sony PlayStation 3 and Nintendo Wii compared to last year.
Context & Ripple Effects
Nielsen's October 2011 survey puts numbers behind something console makers have been building toward: weekly streaming and video-on-demand usage is up year-over-year on all three current-generation machines — Microsoft's Xbox 360, Sony's PlayStation 3 and Nintendo's Wii. The finding matters because it comes from an audience-measurement firm rather than platform-holder self-reporting, giving the first independent read on how much of console time is drifting away from games.
The story travelled quickly through syndication, including a CNET pickup, which suggests the trade press was already treating consoles-as-streaming-devices as a live question heading into the holiday season.
First-order effects
- Microsoft, Sony and Nintendo each enter the holidays with measured evidence that media apps are growing their share of time on their flagship hardware, strengthening the case for marketing consoles as living-room entertainment devices and not just game machines.
- Streaming and VOD services distributed through those consoles gain a documented, third-party-verified usage channel into the television, which strengthens their hand in carriage and placement negotiations with the platform holders.
Second-order effects
- With Nielsen now publishing usage share by device, competition among the three console makers shifts partly toward which services each platform can secure and feature prominently, making content deals a differentiator alongside exclusive games.
- Cable and satellite providers face incremental pressure in the living room as the installed base of consoles doubles as an on-demand video endpoint outside the pay-TV box.
Third-order effects
- If the year-over-year climb continues, consoles consolidate into general-purpose entertainment hubs where gaming is one application among several — the console-to-service flywheel — and platform value accrues to whoever controls the app storefront and the usage data.
- Audience measurement firms extend their franchise from broadcast ratings into per-device streaming share, giving advertisers and networks a common currency for judging these new distribution endpoints.
The trend: Game consoles are becoming primary living-room streaming devices, with independent usage-share measurement turning media-app distribution into a core battleground between Microsoft, Sony and Nintendo.