Users who frequent social networking sites such as MySpace show a predilection for online video, with 55% viewing streaming videos and 21% downloading long-form videos on at least a monthly basis, according to Parks Associates’ Internet Vide Direct-to-Consumer Services.

This correlation between social networking Websites and Internet video services is even more dramatic when comparing social networking users and non-users. People who visit a social networking site at least weekly are overall six times more likely to download long-form videos and 1.5 times more likely to view streaming Internet videos than are those who do not use these Websites.

“Whether the business model is free video streaming backed by advertisements or the sale of online movies and TV shows, social network Websites are well positioned to become strong contenders in the Internet video business,” said Yuanzhe (Michael) Cai, director of broadband and gaming at Parks Associates. “On the other hand, online video Websites, if they are to be competitive, need to beef up their social networking features to attract and retain users.”

Media companies with online assets also have the challenge of attracting older users, who are likely to have more disposable income but are not yet part of the social networking scene, Cai said. Currently, two-thirds of frequent social networking users are younger than 24, an age group that typically includes heavy users of digital entertainment. In order to approach older demographics, these companies need to seek alternatives.

“Social networking sites such as MySpace and Facebook are effective in reaching a young and dynamic Internet audience, but the question is what’s next?” Cai said. “Besides monetizing their social networking assets, large media companies need to attract older demographics to social networking or leverage other virtual hangouts that appeal to older Internet users, such as peer-to-peer communities, which have a slightly older audience, or special-interest websites like iVillage.”

Internet Vide Direct-to-Consumer Services examines the growing market for online video, defined as video delivered over the Internet. The information and analysis address the industry value chain, business models, the challenges and opportunities for traditional and emerging players, new online video technology solutions, and consumer perspectives.

For information, visit http://www.parksassociates.com. For more market research data, available through Parks Associates’ Fast Facts site, visit http://www.parksassociates.com/fastfacts.

About Parks Associates: Parks Associates is a market research and consulting firm focused on all product and service segments that are “digital” or provide connectivity within the home. The company's expertise includes home networks, digital entertainment, consumer electronics, broadband and Internet services, and home systems.

Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, multiclient studies, consumer research, workshops, executive conferences, and custom-tailored client solutions. Parks Associates is also a reliable resource for industry, local, national and international press, providing data, analysis, and insight on all aspects of the “digital living” markets.

Parks Associates hosts several fall events and co-hosts CONNECTIONS™ and CONNECTIONS™ Europe (in partnership with the Consumer Electronics Association) each year. In addition, Parks Associates produces the publication Industry Insights two times per year in conjunction with the CONNECTIONS™ Conference series.

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