Live TV Fragmenting, Not Dying – YouGov
TV viewing is not "in its death throes," according to a new report from YouGov, even though "headline" TV broadcast figures have been steadily declining for 20 years. The steady deterioration of ratings figures for TV shows is more a function of fragmentation than decline, according to the report. Catch-up TV services from broadcasters and pay-TV providers, and the availability of a broader selection of content online are shifting viewership from a handful of live channels to multiple platforms and channels, both live and on-demand.
The study analyzed ratings for TV shows going back 30 years. The highest-rated show in 1986 was BBC soap Eastenders, which brought in 30.15 million viewers. Fast-forward to 2016, and the highest-rated show was The Great British Bake Off, with just 11.63 million viewers. That's just over one-third of the viewership, suggesting that TV viewing has fallen away quite dramatically.
However, the total number of minutes watched per viewer have not declined anywhere near as precipitously. YouGov hasn't provided viewing minutes as far back as 1986, but tracking data from 2006 onwards, the number of minutes of TV viewed per day are fairly consistent.
The average number of viewing minutes in 2016 was 231.6 per day, which is actually higher than the equivalent in 2006, at 216 minutes. While viewing times have increased and receded over the years, they average out to 251.6 over the past ten years -- fairly close to the 231.6 minutes average for 2016.
What is happening though is that viewers are increasingly shifting their viewing to other screens. According to YouGov, 80% of viewers view some or all of their video content on their TV screens, but devices such as laptops, desktops, mobile phones and tablets are now eating into live TV consumption. Many are using multiple devices to view video, depending on the source of video content, time of day and location.
The availability of smart TVs and specialized streaming appliances is also affecting viewership. The study found that 38% of respondents had a dedicated streaming appliance in the home, such as Amazon Fire TV, Now TV, Apple TV or Roku. These offer access not only to OTT streaming services such as Netflix and Amazon Prime Video, but also catch-up services from the major broadcasters. And according to research from UK regulator Ofcom, these catch-up services are responsible for the bulk of video streaming in the UK.
But even users of VoD services tend to view content along the same times as live TV viewers, with peak times approximately between 5.30-11.00 p.m. And a clear majority continue to view live TV, with 69% saying they watched shows on BBC One in the past month. Other channels are regularly viewed as well, with 51% viewing Channel Four, 48% viewing ITV and 47% viewing BBC Two.
The study is useful as a reality check in some ways, because as an industry we are in danger of focusing too intently on the disruption that OTT is creating. That's important, but it's also important to recognize the pace of change. Traditional TV outlets continue to generate far more revenue than emerging ones to date, and are likely to continue to do so for several years to come. It's important that the pay-TV ecosystem recognizes that traditional behaviors are still an important revenue source, and must continue to be supported.
At the same time, change is coming. While the YouGov report did not address younger viewers specifically, it did find that VoD users were most likely to be students. And research from Ofcom did find that viewing of VoD for all adults in the UK grew by 8% between 2014 and 2016. In particular, among those aged between 16 and 24, VoD grew 24% and accounted for the majority of their video consumption, at 57%.
Ofcom did find that the rate of growth of VoD viewing had slowed among this segment, suggesting that cannibalization of live TV was evening out. This would suggest that there is a balance to be found between live and on-demand, even among the youngest, most disruptive of customers.
However, it also found that this shift was accelerating among older segments at the same time, so we are likely to see each age segment find its own balance between the various options available at different transition rates.
The data suggests that the shift from linear to on-demand is likely to continue, and it will affect everyone, not just one segment. However, it also suggests that this will not be a complete transition. A significant percentage of video consumption is likely to remain with live TV for the foreseeable future, and as an industry, we need to continue to cater to that behavior.
— Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation