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Scott Brown and Nielsen’s Nic Covey will be on hand this week at CES as panelists. View the presentation deck on Three Screen Measurement from Scott Brown.

Nic Covey, Director of Cross-Platform Insights, The Nielsen Company

The big question in the new Internet decade is whether consumers will pay for content online.  It turns out that millions of global consumers are, in fact, willing to pay up… but not for everything.  For example, consumers are three times as likely to pay for online music than for a blog.

Consumers weigh in
Nielsen recently conducted a global survey of more than 27,000 consumers in 54 countries to examine attitudes about paying for online content and to determine which content types consumers were most willing to support financially.  The findings show that many consumers are willing to pay for online content or are open to increased advertising to pick up the costs, but attitudes vary greatly by geography, demographics and content type.

Paying for (perceived) quality
Consumers show a higher propensity to pay for music, movies, games and professionally produced video than for podcasts, blogs or consumer generated video.  This validates the notion that consumers globally still place more value on content produced by “professionals” than by other consumers.  Likewise, they are more inclined to spend money on what they already pay for, rather than on what they currently get for free.

While it may seem obvious that consumers are more willing to pay for professional content than amateur, the reality shouldn’t be taken for granted: to consumers, not all content is created equal.

Bring on the ads (in the Middle East, at least)
Overall willingness to pay for online content may surprise some, but more surprising yet is the extent to which consumers in some markets are still open to more advertising.  Nearly half (47%) of global respondents said they would put up with more ads to subsidize free content, but that willingness swings by market.

While 57% of respondents in the Middle East, Africa and Pakistan are open to the more advertising – as are 55% of those in Asia Pacific – just 40% of North America respondents and 39% of European respondents agree.

Later this month we’ll release the broader findings of this study.  The paper will reveal many of the regional, demographic and content nuances of willingness to pay for online content.  The key takeaway is this: across geographies, demographics and content types, consumers think very differently about how they’ll pay for content.  Accordingly, monetization models will have to be flexible – there will have to be more, not fewer, options to supporting the cost of content.

Predictions

• The future of monetization will include a much broader range of revenue models than exist today
• Good and useful content will always find patrons.

A timely conversation
On Friday, January 8, at the International Consumer Electronics Show (CES) in Las Vegas, I’ll join a panel of colleagues to discuss “Predictions and Opportunities for Media Monetization.” CES is an appropriate place to have this conversation: there we’ll see the latest tech gadgets that will offer consumers even more anytime, anywhere access to both free, and paid content.

HDTV flat screen televisions dominated, with 3D, Internet-enabled and ultra-thin and flexible screens on display.  New sets with on-screen interactive “widgets” to click to additional information and services were demonstrated by Yahoo!, Intel and Samsung.  Using this functionality, consumers can check their stock portfolios, the weather, sports or a host of other activities.  There were also Blu-ray devices with the ability to access the internet for movies from Netflix with a simple click of the remote.  Tru2way digital set top technology, wireless HD capability and location-aware GPS capability increasingly built into most new products were also featured.  Increasingly, the “always connected” promise of the Internet was featured in an array of devices with location awareness which likely means that targeting applications will rapidly increase to small personal devices we carry in everyday life.

“It’s clear that electronics companies are focused on making products work better and faster and with an eye toward styling and design.  Simplicity is key, as is providing tangible “connected” value to consumers.  Having attended a number of these shows, I was genuinely impressed with the innovation on display, despite a turbulent economy in 2009″ said Scott Brown, SVP, Digital Platforms for Nielsen.

Other key highlights of the show included:

• LG Blu-ray players with built-in streaming for Netflix, CinemaNow and YouTube
• Samsung Blu-ray players with WiFi
• Blu-ray players at the $200 price point
• Significant advances in audio technology for mobile products and gaming applications from Dolby
• CruiseCast, in-car satellite TV service from AT&T
• DVR hard drive capacity expansion
• LG Watch Phone, featuring a touch screen interface, stereo Bluetooth, speakerphone and built-in music player
• NETGEAR’s new portable Internet video player
• Hitachi’s gesture controlled television

Hello all, and welcome from a slightly chilly Las Vegas. I’m a bit of a gadget dork, so coming to CES (Consumer Electronics Show) has been something I’ve looked forward to for some time. But you might be asking yourself, “Jon covers media, not technology, why, during these challenging economic times would Nielsen send Jon to hang out in the desert and lose money on cards for three days?”

The answer is twofold. First, I’m speaking on a panel tomorrow (if you’re around, stop by and say hi). That alone typically gets me out to conferences.

But there is actually a far more important reason. For some time we’ve been talking about media fragmentation. This has typically meant that there are more media options, more publishers, and just basically more media to consume. That clearly hasn’t changed, but what has changed is that we’re on the edge of a new era of fragmentation – where the publishers themselves are fragmenting their own media.

Let’s take a simple example – “Two and a Half Men.” CBS is currently showing the same series programs on: TV, iPod, CBS.com, YouTube, AOL TV and about a dozen other sites. The content is also available on TiVo, cable DVR, and a handful of other boxes people attach to their TVs. Now this doesn’t even include piracy, SlingBox/Sling.com, DVDs and a bunch of mobile content. So in many ways, CBS is fragmenting its own audience. And because rate cards are different for all of those platforms (where advertising is available), they are fragmenting their ad dollars for the only sitcom on TV that still consistently does well in the ratings.

So what does this have to do with CES? Interactive media is quite clearly no longer just about computers. It is about all three screens and different devices attached to those screens. If you’re talking about interactive video, but not talking about DVR, mobile and other alternate platforms, you not actually talking about interactive video.

So why am I here? I’m here to see what the future of all these screens looks like. Because someone has to measure them, and goodness knows, I want Nielsen to be the one to do it.

This is day one of my dispatches – I’m here through Friday. I’m hoping to have some video interviews to share with everyone tomorrow.