In a recent survey conducted by Citigroup analyst Mark Mahaney shows what percentage of web users use the following particular online video services:
- Apple iTunes
Hint, iTunes wasn't at the top. Wasn't in the middle. It turns out only 9.8% of users cited using iTunes for their online video use.
Compare that to YouTube (69.2%) and Facebook (27.1%) and it becomes apparent people don't go to iTunes for their everyday video fix. However, it is important to note that while YouTube has the largest percentage of the market, it is also free to the consumer. Netflix, on the other hand, is a paid service, albeit a paid subscription model. Hulu is a close fourth to Netlfix, but again most of its visits are from free users, not Hulu Plus members.
Mahaney mentions that if YouTube were able to collectively put together a business pay-to-play model, they will dominate the market. He doesn't think however that Google has the skills to do that at this point. Mainly because users expect YouTube to be free. Heard much about how the recently released YouTube rentals are doing? Neither have we.
For iTunes it remains unclear whether Apple is planning on expanding their online video capabilities. Before WWDC, there was speculation that the data center and other simliar infrastructure ventures were steps to prepare for a Apple video service to launch similar to Netflix. It does seem like a natural buildout of the iCloud universe. If Apple wants to continue to be a factor in the online video marketplace, innovation is needed, and Apple TV in its current iteration isn't the answer. Still, Apple's plans are always mum, and don't expect them to be sitting idly by.