Commentary
Who 's The TV King? Nielsen Says It ISN'T Content -- For Now, Anyway
- by Wayne Friedman , Staff Writer, June 17, 2010
A small segment of young consumers isn't ready to anoint content as king. The price of that content may actually be taking that crown, instead.
Nielsen says some 4 million homes -- 6% of all non-cable TV homes -- haven't "cut the cord" because of backlash anger over cable companies. They haven't installed it in the first place.
These viewers are young, 18- to 34-year-olds, in "emerging" homes. They are downscale or middle income, college-educated, some of ethnic background. All this make sense: Graduating college students would seem to continue their college habits in the real world, with real jobs.
But these viewers bust the myth of their fellow consumers: Nielsen says they are surprisingly "light" TV and video consumers.
Here's another busted myth: While viewing levels watching an average TV show are virtually consistent from the first to last minute, viewing levels for the average show streamed online drop substantially from first minute to last. I'm guessing you could attribute this to the short-attention-span, YouTube approach to things.
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About 2.5% of all video viewing among major demographics is online; that means TV still commands a big 97.5% share -- something isn't likely to change anytime soon.
"Online really needs to grow to make a significant dent. There is a long way to go," said Jon Gibs, vice president of media analytics for The Nielsen Co., during a presentation at Nielsen's Consumer 360 conference in Las Vegas recently.
Overall, this means people don't watch video the same way on their computers as they do with a live TV show, or with time-shifted viewing. Gibs says it means content isn't actually king, but the platform first -- then, content, a close second. Traditional TV still comes first because it's the best screen. But it is not always the most readily available. That would seemingly be your laptop, mobile phone, or iPad.
We are pretty sure if content isn't quite king across all media platforms, it surely is the up-and-coming lieutenant -- perhaps one with a bad attitude -- looking to take the kingdom by storm if necessary. But what if some light-video-using young viewers grow in number, if not continue to shrug their shoulders?
Wayne Friedman is West Coast Editor of MediaPost. You can reach Wayne at wayne@mediapost.com.
Wayne, great points about that stinky 6% of non-cable homes, and the interesting demographic of “emerging homes” - 18-34 year olds. Your point that 17% of US households are wireless-only- and perhaps growing to 20%+ is a red herring however, because that (now dated) 2008 article http://bit.ly/9I32zY mentioned issues/barriers relating to simplicity of operation, call quality, etc that are largely being addressed today via services such as Skype-to-go, GoogleVoice and derivatives (for phone) as well as simple one-time-purchase gadgets like this http://bit.ly/afkFGj gadget to connect a cell to a home or apartment’s “land line” (read: “cordless phones”). And it gets simpler, cheaper and easier (and better quality) all the time.
Likewise signal (Internet/data connection) is being addressed, and fast connections via 3G and 4G are making “wireless video” and pure Internet Video more of a reality. Quality of service is improving fast. HTML5 and faster connections make this an exciting time for streaming video.
The challenges (and opportunities today) are around making the User Experience simpler. We should see more ideas like Hillcrest Labs’ Kylo Browser, http://bit.ly/be6Q1d GoogleTV, Boxee, AppleTV and derivatives making this an exciting time for consumers. And it’s getting less geeky all the time. A lot has happened even in the first 6 months of this year. Even old creaky dinosaurs are showing signs of consumer-facing innovation, including Comcast, Hulu (interesting side story about overlapping ownership & channel conflict there), and now a resurgence in the efforts of the entire ecosystem of legacy and new set top box manufacturers (likely in the absence of any announcements from Cisco – yet – about home gateways and possible dueling TV/Data superhighways…CDNs…).
I think you are hitting on two very interesting areas:
1) The millennials are continuing to consume content, just not via cable. And yes they are budget constrained now, but as they mature, their ad-hoc “cobbled-together” media consumption will morph into gateway-enabled aggregation, and user-defined consolidation may become the norm. Writing them off as “poor cousins” or “cheap” is a dangerous game. I think you hit on this by emphasizing: “Graduating college students would seem to continue their college habits in the real world, with real jobs.”
In other words, millennials will “find” access to the content they desire via whatever they perceive as the least-cost and lowest-hassle means. Meaning that they will watch over-the-air TV when forced to do so – likely for news, politics and of course sports… and perhaps the top 3 networks. And they’ll go to Hulu, et al for the other Cable and non-broadcast hits they discover from their social graph. And yes, they may go to the torrents for the rest (although we are getting very good anecdotal data that they would rather not go to the torrents if they don’t have to, and would tolerate ads, sponsorship or some very small tarrif to see their content via legitimate means, if it were easily available).
Device-based gateways that provide this (and very soon, network/cloud-based services that do this) will be the dead-simple solutions our kids experience. And this may happen in the next 18 months, driven primarily by new entrants that already own much of this demographic attention via mobile device, app and game engagement.
2) I submit that Socially Connected/Enabled User Experience is king.
Platform is king perhaps--- but I don’t think we should focus on the Nielsen “conclusion” that users are “lite.” Rather, online video is still more of a nosh than a sit-down meal. That may be because so much of the online stats are skewed towards short form non-network content. As well, younger viewers (millennials) are “TV noshers” even on a fat cable subscription. ADHD? No, just the multitasking brains and impatience of youth. The biggest difference is that their “TV” surfing behavior is masked by DVR and social TV behavior that is not (yet) simple to do on mobile devices, and is only now being enabled on standard laptop/game console platforms. But it’s coming to your flat screen or dorm room /apartment screen. Fast.
Again, the idea that platform is king is a red herring. Content will always be king, but not in the way “our” generation thinks about it (I am a boomer). Content is what you discover through your social graph. And this content, and the way you consume it is variable and subject to rapid change. In fact the millennials are the first group to be agnostic of the pipe, and intolerant of barriers, pay walls, complicated authentication and crude advertising practices.
So by being agnostic of the pipe, the discovery here is that not platform, and not content, but User Experience will be king (okay, subject of course to content). User experience means simple, user-controlled, user-empowered, socially connected and always-available (any time, anywhere, any device).
This is an old, and by now hackneyed expression, but what we need to focus on is not the pipe, or the actual content, but on the users and their preferences, social behavior and core user experience. Steve Jobs figured that out long ago. And if we’re not careful, he’ll quietly (well perhaps not so quietly) create a User Experience and device /network combination (perhaps with his neighbor Cisco) that caters to these millennials and leaves the rest of the industry wondering what just happened. Perhaps AppleTV is not so much a “hobby” as a User Experience Laboratory, in connection with iPodTouch and the iPhone. Or maybe Eric Schmidt smurfs Android into enough wireless and other devices (and perhaps home gateways) that enables YouTube’s backbone (and perhaps ubiquitous WIFI) to compete as a real CDN and consumer aggregation point…. Make no mistake, content owners will cave to whomever provides them the most revenue… it’s their fiduciary obligation…so it’s going to be a great (albeit bumpy) ride!
So to understand these mobile consumers, come join us July 21 in San Francisco at GeoLoco-II –The Conference, for all the inside scoop on GeoLocation and how big brands are leveraging mobility, wireless devices and real-world location to engage consumers!
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Matt Weeks
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EyeTMedia
www.eyetmedia.com
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mweeks@eyetmedia.com
Wayne:
Really, who would choose a mobile or a computer screen over the big screen TV? 2% sounds about right. With TV viewers spending 5.5 hours per day in front of the set versus mobile or computer viewing at 6 and 7 minutes respectively per day, it's easy to see that video viewers want BIG SCREENS. Mobile and computer platforms are simply not worth the effort and expense some broadcasters are sinking into the new technology. In fact, if broadcasters ever pulled permission to display their products on mobile or computer platforms, you'd see mobile and internet viewing dry-up overnight. But Broadcasters are a stupid bunch, as a whole. They play follow the leader, thinking the new technology is the way to grab the viewers when the change takes place. It won't change any time soon! Take a guy, drinking a beer and watching the big game, and replace his TV with a mobile phone screen sized picture. You could get killed doing that. TV should protect itself and let mobile and computers scratch around for content. Just a thought.
Viewing on a small screen is a fall back position, not the optimal experience. Financial and OOH are the drivers to view video on devices. With the growth of technology for a very easy, very simple affordable way to transmit video and more from a computer/hand held to the large screen, there will be more device watching if that's what is to be judged from where the content derives. Again, the median income is $30,000 per year per family (more than one person). What do you think?
I "Cut the Cord" 3 1/2 years ago, after getting fed up with the lack of Variety along with the ever-increasing amount of Commercials being shown during each Program. Switching to Home Video, I now make my own schedule each evening, and nobody butts in to hawk a product I have no interest in purchasing. I pay the same amount of money each month to acquire more programming as I did for the "Privilege" of watching Cable TV, but this is offset by one HUGE Difference, after I finish watching it, I GET TO KEEP IT!