Internet TV has had little impact on British viewing habits, according to a Deloitte report that found that just 4% of the UK population consider it "very important" to be able to receive TV via the Internet, while 47% still regard it is as not important at all.

For their part, television industry executives see the Internet as broadcast commercials’ greatest threat in 2008 with 69% of executives fearing the movement of advertising revenue away from television to online. They predict a growing appetite for Internet television, with 47% believing that by 2010 Internet TV will be embraced by the majority of viewers, but for a minority of viewing.

Jolyon Barker, head of Deloitte’s Technology, said: "There are a number of factors preventing Internet TV from becoming mass market and competing directly with broadcast. One is uncertainty over the business model, particularly around the viability of advertising. Television executives see the lack of bandwidth (25 per cent) as the biggest concern, with uncertainties over who might fund the billions of pounds required to provide the super fast broadband service needed to accommodate future demand for downloading Internet TV.

"At the moment most viewers simply do not want most of their television to be on-demand. The majority still prefer to have their television scheduled for them. In the future Internet television will become one of the principle options from which the mass market could occasionally source its television viewing, along with direct broadcast, DVDs and PVRs."

Television executives fear for the future of the traditional television commercial due to the movement of advertising revenue away from television to online (69 per cent). However the report reveals members of the public were mainly content (43 per cent) with the number of commercial channels on television and only a quarter (27 per cent) wanted fewer. The perceived threat of Internet television to the industry will be the ease with which viewers can skip pre-recorded advertisements.

Jolyon said: "It is clear that television and the Internet are not discrete, mutually exclusive advertising media. Broadcasters should not see Internet TV as a threat to traditional TV. A pound spent on the Internet does not necessarily mean a pound lost for television. Internet TV will continue to play a key role in the television sector and one of its biggest contributions will be to bolster traditional, linear television, for example marketing programmes that help to maintain interest in a series between episodes. An increasing number of campaigns rely on a strong integration between Internet and television.

"Television’s advertising fortunes may be increasingly tied to the Internet. This is dependent on the ability of media agencies to accelerate the progression of the integrated multi-platform campaign from aspiration to reality. Emerging innovations such as high-definition (HD) advertisements and live commercials should maintain – and may even enhance – the value of television in conveying big message advertising to a mass market."

Story filed 26.08.08