The Channel 4 TV Planning Awards 2006: Video-on-demand

Rather than simply dipping its toe in the water, Channel 4 has decided to plunge head first into video-on-demand and it is keen to share the experience with advertisers, Sarah Rose writes.

My neighbour is a doctor. He is 33, lives alone, works long hours and socialises a lot. He hardly ever watches television. Then, more out of neighbourly courtesy than any sense of expectation, he downloaded 4OD. Now he is hooked. He has rediscovered The Word, watched the £250,000 episode of Deal or No Deal, sampled Ugly Betty and downloaded Child Genius. He is not a marketing creation, he is a genuine consumer, rediscovering TV on his own terms.

And he is not alone. Millions of Channel 4 programmes have been watched on demand through the TV and PC and the users are increasing all the time. 2007 is turning out to be the year when on-demand platforms have arrived. Virgin Media put VOD at the heart of its relaunched platform, the much-awaited BT Vision has arrived, Sky has launched Sky Anytime, then there are iTunes, Amazon Unbox, Microsoft Xbox, Google, Yahoo!, Sony PSP ...

So is this a TV revolution or a blip on the linear viewing landscape? It is too soon to tell definitively. Estimates vary widely from 5 per cent to 50 per cent of viewing being on demand by 2012. It is a technology here to stay, and those who have tried it like it, and are coming back for more. Our audience - 16- to 34-year-old weighted - are typical early adopters of new technologies and we recognised that if we did not immediately take a strong position in the on-demand market, others would do it for us.

Long regarded as pushing boundaries and innovative, Channel 4 is a natural destination for viewers seeking content they know they like, legally and virus-free, from a brand they understand and trust. So we are not dipping our toe in on-demand waters, we have plunged in head first. In October, we launched a comprehensive service on Virgin Media, with BT Vision and Homechoice added since. And 4OD, our own downloadable player, launched in December.

Hot on the heels of being the first broadcaster in the UK to simulcast its channel online, we became the first globally to put all its commissioned content online. Agreements with more than 100 indies are complemented by US studio deals, so premieres of Ugly Betty, Desperate Housewives, ER, The OC and Smallville, among others, are available exclusively on 4OD. And we have only just started. Our archive is growing all the time, we are adding to our film line-up and content from other broadcasters is coming soon. We are developing partnerships with other online players, and our on-air marketing has seen downloads of our application rocket.

So we are there with a vengeance, learning about a market by experimenting from within. And now we are looking for commercial partners to come and learn with us. With the introduction of advertising on the PC in March and later in the year on 4OD on TV, we believe we are bringing an innovative and exciting product to market. Early usage data is proving our initial gut feeling right: viewers in the on-demand world show a higher level of appreciation for the content, are more engaged with it, more receptive to messages delivered around it and retain a higher sense of awareness. They know what they are looking for, but once there, are prepared to try new things. We know who they are, where they live and what else they watch. And we have listened to what they tell us about their tolerance for commercial messages. There will be fewer commercial messages than the viewer is used to, so the chance of cutting through a viewer's consciousness is higher. New functionality will be rolling out across the year, with more personalisation, and we are looking for advertisers willing to speak to these viewers with as much flair and creativity as they are demanding of us as a broadcaster. VOD is not just a technology, it is a rich consumer experience; one we are proud to be developing and are keen to share.

- Sarah Rose is the head of VOD and channel development at Channel 4.