A Study of an Industry in Its Infancy

DOI: 10.2501/JAR-51-1-276-287 INTRODUCTION AND REVIEW Thirty years ago, television was the medium that drove the creation of advertising. In 2011, advertisers aggressively are seeking alternatives to television advertising in the wake of escalating costs and decelerating reach. Audience erosion has been attributed to the proliferation of television channels and the increasing popularity of media alternatives such as video rentals, video games, and Internet use. Although the new media options often provide advertisers with the ability to microtarget an advertising message, television remains a reliable—if expensive—medium for achieving broad reach. This article investigates the relatively new phenomenon of online access to television programming in the belief that advertisers can use online streaming television to increase the efficiency of television advertising. As of April 2010, Nielsen stopped reporting how many channels the average television household receives because a television channel’s content is no longer accessed in a single, easily measurable manner (Mandese, 2010). Television viewers now are able to time-shift content by recording shows or accessing content online. Online streaming television programming, however, offers three important advantages to advertisers seeking to differentiate their media portfolio: