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Apple, Google, Hulu Show Online Video Gains

The online video businesses is growing, but viewers want to watch Internet video on their TVs.

Online video viewing continues to grow, leaving market leaders like Apple, Google, and Hulu well positioned for ongoing gains.

According to an Ipsos MediaCT report, 67% of U.S. Internet users have streamed or downloaded digital video.

Brian Pickens, senior research manager at Ipsos MediaCT, said in a statement that Americans are watching a wider variety of online video than ever before. As a consequence, he suggests, TV and movie studios can be expected to continue to bring high-quality video content online. He adds that a majority of digital video viewers appear to accept video advertising as a way to subsidize the continued availability of free online content, which marketers should see as a positive sign.

In contrast to the 86% of respondents who felt it was either very or somewhat reasonable to have ads in full-length movies or TV shows online, only 50% felt the same way about ads in amateur or homemade video clips. This points to one of the challenges that YouTube faces in its effort to monetize video assets that skew toward the non-professional.

Between September 2008 and April 2009, awareness of leading digital video sites went up, significantly in some instances.

Hulu, for example, the online video site co-owned by NBC Universal, News Corp., The Walt Disney Company and Providence Equity Partners, saw market awareness rise from 9% to 41% in the months between September 2008 and April 2009 and saw usage as a video provider rise from 3% to 14%.

During the same period, Google's YouTube saw awareness increase from 83% to 87% and usage increase from 49% to 56%.

Apple's iTunes during this time also saw gains. Awareness of the iTunes Store went from 46% to 49% and usage for video delivery rose from 8% to 10%.

MySpace fared less well during this time frame, dropping from 54% to 46% in terms of awareness and 13% to 9% in terms of usage for video.

Over 150 million U.S. Internet users watched online video in July, the largest number every recorded, according to ComScore.

Users reported a strong preference for viewing online video on televisions rather than computer monitors, according to the Ipsos MediaCT study. Pickens suggests that the door is open for technologies that can help put Internet content on TVs.

Consulting firm Technology Business Research, Inc. has come to a similar conclusion. In a research note issued earlier this week about the lackluster uptake of Apple TV, the firm states that "the Web is rapidly emerging as the dominant delivery system for video, including television and movies" and that it believes Apple will upgrade its Apple TV device to make it more capable as a bridge for moving Internet content to TVs, perhaps by integrating it with a Web browser.

Apple is making a new product announcement on Wednesday morning, but the event is widely expected to focus on a refresh of its iPod product line.

InformationWeek has published an in-depth report on Google's upcoming Chrome OS. Download the report here (registration required).

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