Report: The State of Live TV Doesn’t Look Good

-Nielsen Shows More Declines in TV Viewing

-MoffettNathanson Says Pay TV Networks Losing Ratings

-VAB Report Points to Need for Better Streaming Metrics

The past five years has seen a tremendous upheaval in the home entertainment sector. From the deluge of high definition video traveling across mobile networks, the glut of streaming video services, the rise of so-called virtual MVPDs, and the explosion of live video streaming across social video networks – it’s clear this isn’t your father’s television anymore.

And consumers are responding accordingly, by dramatically shifting their viewing behaviors to platforms and devices that give them a more personalized, and convenient way to watch premium video content, regardless of where that content comes from. This week, we read a handful of reports shedding light on some of the various facets of the emerging video landscape.

 Nielsen’s Report: Doom and Gloom for Live TV

Nielsen’s latest “Total Audience Report” for Q2 found traditional TV viewing is still in decline, while consumers are opting to spend more time watching video content across other devices. The report also notes that the trends of cord-cutting and cord-shaving are beginning to appear in its analysis of viewing data. “We now find that channels receivable has started to decrease somewhat, as a result of lower multichannel penetration and cord-shaving,” said Glenn Enoch, SVP of audience insights at Nielsen.

Here are some takeaways from the report:

  • Average live TV viewing is down another two minutes over last year’s Q2, and is down a full 10 minutes over Q2 2014 levels.
  • The younger demographics continue their migration away from traditional TV. Live TV and time-shifted TV viewing dipped 8% compared to Q2 2015 for the 18-24 demo.
  • Average daily time spent on media devices other than the TV have all increased over the past year. Smartphone usage jumped 34 minutes, PC use increased 14 minutes and tablet use increased 12 minutes.
  • Pay TV subscribers are aging, and the pool of pay TV subs is getting smaller. Pay TV lost 1.75 million subs between Q2 2015 and Q2 2016, while broadband-only homes increased 25%. Still, the number of broadband-only homes have reached 4.1 million.

The Nielsen data has well documented these shifts in consumers’ viewing behaviors over the past five years. The takeaways here are not in the minutiae of quarter-to-quarter dips, but the larger trends and trajectories.

Pay TV Networks Lose Gross Ratings Points

Another measure of the state of live TV: pay TV networks’ live national gross ratings points (GRPs). Some networks have seen marked declines in live national GRPs over the past five year, according to analyst firm MoffettNathanson. Pay TV networks owned by Viacom, NBCUniversal, Disney, A&E Networks and Time Warner have all seen decreases in live national GRPs between the 2015-2016 season and the 2010-2011 season. Only a handful of networks have managed to increase live national GRPs.

A&E Networks -35%
NBCUniversal -27%
Time Warner -18%
Disney -18%
Discovery +21%
Fox +14%
Scripps +9%


VAB Highlights Confusion between Content Sources and Delivery Methods

And then there’s the Video Advertising Bureau’s (VAB) “Requiem for a Stream,” a set of three reports that argue traditional TV is still king. The reports highlight the prevalent confusion about consumer preferences of content delivery over content sources. The reports pit TV networks against streaming video services, but the underlying trends remain the same: consumers prefer to access content online and on-demand, regardless of where the content comes from.

“Streamers love TV network content and this content is fueling much of the multi-billion dollar video streaming industry,” the report states. “Ad-supported TV brand’s content investment is the lifeblood of the video streaming pipeline which helps fuel the continual replenishment of on-demand libraries. By far, Millennials enjoy watching TV network content over original streaming series and, in most cases, movies on OTT services.”

The report notes that total TV consumption has increased slightly over the past year, across all platforms, but time-shifted viewing behaviors are gaining traction among consumers of all ages. The fact the content comes from traditional TV networks is of little consequence to consumers who are looking for better delivery mechanism than linear TV.

“An estimated 74% of the overall two year decrease in total time spent with television can be ‘found’ through increases in TV network content viewership on other sources [ie platforms] such as TV Everywhere apps and major SVoD services,” the report states.

The world is moving towards personalized entertainment: consumers are now their own programmers and curators, they decided what to watch, and how to watch it. The services that cater to this home entertainment reality will succeed in the new era of Internet TV, and the services that refuse to change with the times will not.

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