To calculate "average duration", convert the duration for each record to milliseconds, then average the number of milliseconds for the group. Once you have that, then add that to a "zero" date and format it as time. In this example, the average milliseconds is the "12345" value:

SELECT CONVERT(VARCHAR(12), DATEADD(MILLISECOND, 12345, 0), 14) AS Duration

Duration

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00:00:12:347