The More Things Change, The More They Remain The Same
Once a quarter, Nielsen takes a break from ruining the mood of TV executives who can’t understand why their shows don’t get higher ratings, and delivers the calming message that all is generally OK in the TV industry.
Last week was no different. Nielsen’s Cross Platform Report for the fourth quarter of 2011 showed once again that for all the hyperventilating about Hulu, Netflix, Rokku, Apple TV, Blu-ray players, iPads, smartphones and other potential TV-busting devices, television viewing habits remain largely unchanged.
As someone who formerly helped prepare this report, I know that it’s almost impossible to find something new to say about these results, which largely remain the same quarter to quarter, and even year to year. Oh, device penetration evolves and there are occasional movements within demographics, but the fundamental fact is the same every quarter: People watch a ginormous amount of television.
Once again the report tells us that the average American watches nearly five hours of television a day, 98% of which is consumed on a traditional television. And with Americans still gobbling up HD television sets (eight million more homes have them than the year before), TV viewing numbers will probably stay high for the foreseeable future. After all, why buy an HDTV if you’re not going to watch it?
To the extent that there are any surprises, it’s that there are no surprises. It’s remarkably hard to change the habits of the American TV viewer. Even now, more than ten years after the introduction of the DVR, only 8% of TV viewing is timeshifted (and about half of that is watched the same day it’s recorded.) And even four years after the launch of Hulu and other online services, Internet viewing represents only 2% of all video consumed.
If there is a Trojan horse in the American living room, it could be the once-lowly game console, which gives viewers easy access to movies, television shows and other online content. Given that there are now more consoles than DVRs in the average home, it’s not surprising that viewers spent 30% more time on consoles in Q4 2011 than during the same period in 2010.
Nielsen reports that the number of people viewing video on smartphones is up 36% over last year. But even so, total viewing remains miniscule, with the average American watching only eight minutes of video on a smartphone per month. This number will probably never be very big because of the unsatisfactory experience of watching television on such a small screen. Tablet viewing, on the other hand, will be a different story. The number of iPads now in circulation is relatively small compared to television usage, but tablet viewing, with its high quality and convenience, will grow as penetration increases.
One Nielsen finding that generated a fair amount of news media attention was the small decrease in total video viewing. This decline -- about a minute and a half per day -- could be a statistical rounding error, or it could mean that the engorgement of the American home with new video platforms devices has finally made a dent in the viewing of traditional television.
To better understand this trend, if there is one, we would need to look more closely at year-over-year demographic behavior, which Nielsen does not include in the report. The dirty little secret behind the steady decades-long rise in total television viewing is that it’s been driven in part by the aging of the population. Each year another cohort of Baby Boomers ages into the 65+ demographic, where the average viewer watches 47 hours of television per week.
It would be particularly interesting to know what’s going on with the 18-34 demographic. This is the group most attuned to new technologies and most apt to cut the cord with their local cable or satellite provider. If their viewing shows a decline, this could be a long-term worrisome trend for the television industry.
But even if 18 to 34 year olds are disinclined to watch ad-supported television the traditional way, two things have to be in place for them to move to other platforms: 1) watching television over the Internet has to be as easy to watch as tuning into a regular television; and 2) there needs to be as much content online as there is on traditional television.
As it turns out, watching television online can be very simple. MLB.TV and Netflix are both easily accessible with the right device, but the content is still limited. Yes, it’s possible to cobble together an evening of Internet television (particularly if you’re willing to do it illegally) but who wants to be monkeying around with URLs and PayPal accounts when you can just turn on a regular TV to get your daily five-hour-a-day fix of television?
So until more content is available online, we can expect the Cross Platform Report to be valuable, but not that ground-breaking. Which should be a relief to the television industry.