The audience for Internet video has reached a critical mass, offering advertisers and television programmers lucrative opportunities, according to Nielsen Analytics.

Highlights of the the company’s research:

• There has been no measurable negative impact on traditional television viewing.
• Video on PCs and iPods is expanding the audience of traditional TV programs.
• Viewers prefer short web-served ads, though the market is split between 15-second and 30-second pre-rolls per program segment.
• Broadband video should have a higher CPM than television, because it offers greater levels of interactivity and viewer engagement.

“Advertisers and programmers using broadband have a unique advantage in the increasingly competitive advertising world,” continued Gerbrandt. “Ad models can be customized and managed in a broadband environment, and interactivity can be embedded into the program in such a way as to enhance engagement which does not take viewers away from the enjoyment of the program.”

The research also offers some insight to broadband users.

• Broadband consumers tend to have high speed web access virtually 24/7 — at work, at home and increasingly across an array of portable devices such as laptops, PDAs and mobile phones.
• Broadband users spend nearly double the number of hours on the Internet compared to US adults as a whole.
• Broadband users tend to be well-educated. The overwhelming majority of those with post-graduate degrees have an Internet connection, and most of those have a broadband connection.
• Broadband consumers are upscale. 17% of consumers have an annual household income of $100,000 or more, compared to 28% of those with broadband connectivity. Less than a quarter (21 percent) of all consumers live in homes worth $300,000 or more; but the figure is 30% for those consumers with broadband in their household.
• The 35-54 demographic is currently most likely to have home broadband access (45 percent).

“Programmers have the opportunity to create new revenue models to benefit content owners and their affiliated stations,” said Larry Gerbrandt, general manager and senior vice president of Nielsen Analytics. “Such ad-supported models are uniquely adaptable to the broadband environment and are potentially superior to existing models because they can take full advantage of the digital environment. With broadband streams, for example, fast forwarding through commercials can be disabled making it more likely the consumers will watch the spots and possibly interact with them.”