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Will Social TV Apps Unite the Fragmented Market?

Last year, interacting with others online about TV content was named one of the ten emerging social applications by MIT Technology Review. Why? The activity could leverage online services, such as Facebook and Twitter, with the potential to rebuild fragmented TV audiences.

With Facebook now having over 500 million active users, and Twitter over 100 million, socail media has gained significant mass. Moreover, Facebook revenue is approaching $1.1 billion in 2010, about double its 2009 revenue.

Many consumers are using social media to connect with entertainment, like movies and TV, thereby creating the new product category -- often called Social TV. It's about using social media applications with a tablet or smartphone while simultaneously watching video content.

Already, Nielsen has reported that 59 percent of U.S. Internet users browse the Internet and watch TV simultaneously. And, this number is sure to grow, especially among younger consumers -- who have grown up with smartphones and prefer watching TV on notebook PCs.

For now, social TV usage is optimal with a PC, iPad or smartphone -- because it allows for greater personalization and interactivity. Portable devices, like smartphones or iPads are popular among social TV users because they already use Facebook or Twitter for communicating with others, and because users can message to many different devices.

"Social TV is about bringing social back into TV," said Jose Alvear, IPTV Senior Analyst at MRG Inc. "TV has always been a social medium, but personal video devices and multiple TVs in the home have made it less social. Today, social networking sites are making it easy for consumers to get social with TV again."

According to MRG's latest market study, social TV's benefits for content owners, TV viewers, service providers and advertisers come in a variety of forms.

Those benefits include driving up TV content viewing ratings, rewarding consumers for watching TV, increasing brand engagement and perhaps enabling new rich-media advertising opportunities.

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