/// The Convergence Tipping Point

October 14, 2013  |  All Things Digital

Image copyright Dusit The media and technology world has reached a tipping point, one captured in some prosaic but infinitely powerful numbers. In the U.S., on a normal weeknight, video streaming on Netflix accounts for almost a third of all Internet traffic entering North American homes . The average U.S. household now has 5.7 Internet-connected devices , and according to ratings agency Nielsen, 41 million Americans watch video on a mobile phone for an average of five hours and 23 minutes per month . New market entrants, from Netflix to Apple, distribute both original and third-party content to a global audience on virtually any connected device via the Internet, and are rewriting the rules of global television distribution and consumption. As a symbol of the speed and scale of over-the-top distribution, Netflix itself just won its first Emmy — the first ever Emmy for Internet-distributed content — for best director of its ground–breaking drama “House of Cards.” To put this in context, HBO began creating original content in the early 1990s and only won its first Emmy in 2001 . It took Netflix just one year to gain 14 Emmy nominations and win its first award . Netflix’s accomplishment highlights the reality that the convergence revolution has finally, and indisputably, arrived. Convergence — the disruptive power of technology to transform the creation, distribution and consumption of media content — is creating game-changing opportunities and threats for almost all established media companies. In television, the incumbent cable, satellite and telecom multi-service operators are being forced to review and often revamp their traditional business models to compete with the OTT distributors who have now achieved material traction. In fact, Netflix now has nearly 30 million domestic subscribers, more than Comcast, the largest cable network.

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The Convergence Tipping Point

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