Commentary

TV Isn't What It Used To Be

by Melanie Shreffler , Columnist, October 14, 2011

It’s no secret that Millennials are watching streaming video online, whether via YouTube, Hulu, Netflix, Facebook, or any number of other sites (legal and illegal). And some are streaming online video via a box connected to their TV, like Roku, Boxee, and even some video game consoles. This generation is tech-savvy and poised to revolutionize the TV industry, particularly cable, just as it did the music industry.

Before I go any further, I should mention that I’m a cord cutter. I got tired of paying a massive cable bill every month and decided to see how I’d handle going without. I still get a few broadcast channels, but I’ve been without cable for more than two years (though I kept my cable Internet service), and I’ve barely even noticed a difference from when I used to have cable TV.

Some students and graduates are deciding the same is true for them. They’ve grown up streaming video, for example, watching online when their parents had commandeered the TV or when they couldn’t find anything they wanted to watch. They’re comfortable with the concept, which has the potential to be devastating to the traditional TV industry. As students strike out on their own and no longer have mom and dad paying their bills, they realize how expensive cable is. And they think about cutting the cord, or downgrading to basic service.

According to a recent Ypulse report, only 28% of students say they can’t live without TV (referring to traditional viewing), compared to 83% who can’t imagine life without music. Some students even prefer streaming video to traditional TV viewing; after all, it gives them what they want when they want it.

What’s a TV company to do? Not what the music industry did. Fighting the digital revolution didn’t go well in that case, and neither would it with TV. A case in point, Fox recently decided to delay the availability of shows on Hulu, making users wait eight days (instead of just a day) to stream shows. The result was a huge spike in people finding the shows via pirate websites.

The biggest challenge the traditional TV industry is facing is the number of quality alternatives. YouTube is making deals to get professionally produced content for its streaming service. There are rumors Netflix is bringing back “Arrested Development” and “Reno 911!” Microsoft’s Xbox Live service has upped its offering to nearly 40 channels of streaming content, including HBO, Sony’s Crackle, Disney, Verizon, and more.

Yet, the fate of the traditional TV industry is far from decided. Hulu is up for sale. Netflix is still finding its place with different audiences, splitting its streaming and DVD delivery services, and now pulling them back into one. And students are still making up their minds if they can do without TV or not. What is certain is that streaming is not going away and, as online services continue to bolster their offerings, traditional TV is going to have to find a way to compete.

Time Warner Cable created an iPad app allowing subscribers to get mobile video on the device. It’s a step in the right direction, but misses the mark in that students still think a cable subscription is too expensive. Similarly, Comcast is partnering with Xbox Live, but again the service is only for cable subscribers. Millennials want an à la carte option to get the shows they want, without paying extra for channels they don’t use.

Broadcast TV’s argument against streaming is that it clips their revenue from advertising (they can’t charge as much for online ads), so they are attempting to force audiences to watch on their terms, when the show is aired live. But when that doesn’t fit in Millennials’ busy schedules, it’s just not going to happen. Both the TV and advertising industries need to get on board with streaming, or they both risk losing the Millennial audience.

gen y, tv

2 comments about "TV Isn't What It Used To Be ".

Check to receive email when comments are posted.

Stanford Crane from NewGuard Entertainment Corp, October 14, 2011 at 10:18 a.m.
Very insightful Melanie. I'm thinking of a new approach for Sports and my World Moto Clash.
Have webisodes leading up to the big race (teams building their bikes and training), it's the richest in motorcycle history and there are no equipment rules, then show the race live on the internet with a "behind the scenes mashup" on network a week later.
Since it's a global sport, it has to be on the web.
Reply

C. Phillipps from Yoohooville, Inc., October 14, 2011 at 11:18 a.m.

@Stanford Crane, Stanford, as an avid motorcycle racing fan and (depending on who's giving the year cutoff) a Millenial, I can honestly tell you that we have to watch the majority of our content online. There's only one channel that covers it on cable, with the occasional race on CBS for dirt bikes. Regular TV just doesn't offer what we want.

Can't wait to see where your race goes - it sounds fascinating!

@Melanie, great article! It expresses exactly what I have been saying for awhile. I think the only point missing here is that a lot of content isn't available for basic tv. Case in point, the motorcycle racing I want to see is bizarrely offered at 1 am a lot of the time, cut off by NASCAR coverage, or not shown at all. So I have to DVR or view online if I want to see it at all. And there are great tv shows out there that we *can't* see without downloading because of archaic rules about where tv can be watched (country or method). OR its content that's on a digital channel (11.2 for example) that I can't watch on my tv because I have satellite, so I had to buy a computer tv tuner card so I could DVR it on there to be able to watch it without pirating content.

There are a grand total of 4 cable channels & 4 basic tv channels we watch. If I could create my own tv package, I'd gladly drop $40 a month for it - which would drop my bill AND make me a happier person.