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There is an obvious reason why AT&T and Verizon (News - Alert) are interested in mobile video. Mobile video consumption is growing so fast, it could make up half of all online video consumption by 2016, according to Ooyala.

Also, it might be reasonable to assume that mobile video consumption will be a significant part of the future shift of video entertainment consumption from linear to on-demand, over the top modes.

If that is the case, not only would AT&T (News - Alert) and Verizon be able to grow new revenue streams directly related to mobile video entertainment, but also be in position to protect themselves against potential losses in the linear video entertainment business.

Year over year, share of time spent watching videos on tablets and mobile devices has increased 719 percent since the fourth quarter of 2011, and 160 percent year-over-year since the fourth quarter of 2012.

Equally important, consumer behavior is evolving. Where once mobile viewing was mostly of short-form video, now long-form content viewing also is growing. About 53 percent of mobile viewing time was of video longer than 30 minutes length.

Tablet users spent 35 percent of their mobile viewing time watching video longer than 30 minutes, says Ooyala.

Mobile viewers spent 31 percent of their viewing time engaged with content longer than an hour in length. Tablet viewers spend 19 percent of untethered viewing time watching content at least an hour in length.

Significantly, for would-be suppliers of mobile live TV programming, mobile viewers watched an average of more than 42 minutes of live video per play streamed over the top on connected TVs, and nearly 35 minutes per play on PCs.

That is significant as it shows existing demand for live TV, not just pre-recorded material such as movies or short videos.

Based on average time per play, live streaming video consumption is nearly two times greater than video on demand on tablets. That is another way of noting demand for live TV, as opposed to pre-recorded video.

“Viewers are especially engaged with live sports on mobile, watching three times more live

sports video than video on demand,” Ooyala says.

The Arecent Ooyala survey of online video publishers and broadcasters found 99 percent rating the ability to deliver video to mobile and tablet devices as “critical” or “important.”