Commentary

Live TV Lives On

by Jack Loechner , Staff Writer, January 15, 2015

A recent LRG study found that 76% of US households have a DVR, subscribe to Netflix, or use on-Demand (VOD) from a cable or Telco provider, with 26% of households using two of the services, and 11% using all three. In addition, 55% of households with a DVR now have DVR service on more than one TV set, up from 28% five years ago.

But, says the report, while much attention is deservedly paid to how these services are transforming the way that people watch TV, live TV still lives on. Nielsen’s recent Total Audience Report and the company’s 2014 cable TV ratings help to shed some light on the dimension and pace of TV viewing change.

The Nielsen Total Audience Report shows a 6% decline in “live TV” viewing across all adults over the past two years, and a 25% increase in time-shifted viewing. In terms of actual time, the report shows that adults spend nine times as much time watching live TV as time-shifted TV.

Average Minutes Per Day Watching TV (Adults 18+)
	*Watching live TV*	*Watching time-shifted TV*
Q3 2014	272 Minutes	30 Minutes
Q3 2013	284	28
Q3 2012	290	24
Nielsen, December 2014

The report also indicates that the average time spent watching “traditional TV” among ages 18-24 is only about half of the average time among all adults. Yet, even with the lower levels of TV viewing, adults ages 18-24 still spend nearly 10 times as much time watching traditional TV as “watching video on the Internet.” This compares to 23 times more time watching traditional TV than video on the Internet across all adults.

The overall decline in traditional TV viewing is best characterized as modest, says the report. While some of the decline may be a function of Nielsen’s methodological change of adding broadband-only households to the samples, the decline also reflects some “chinks in the armor” of traditional TV viewing.

A likely cause of the decline in traditional TV viewing is elucidated by LRG data indicating that the two key groups that tend to spend less time per day watching television are also more likely to subscribe to Netflix. These two groups are younger individuals and those in higher income households. With limited TV viewing time and increased time spent watching Netflix (and video on unmeasured platforms), it was inevitable that these groups would eventually show a decline in traditional TV viewing, concludes the report.

To gauge the relative importance of Live TV and other video services, LRG’s recent nationwide study asked participants the question: “Whether you use these services or not, among On-Demand, DVR, Netflix, and Live TV, which would you rank as most important?

Overall, 43% ranked Live TV as most important, 27% DVR, 19% Netflix, and 11% on-Demand/VOD
In households currently getting some form of on-Demand TV, 39% still rank Live TV as most important, higher than any of the other services
Notably, 31% of Comcast subscribers rank on-Demand/VOD as most important, compared to 7% of all others

There are also differences in the rankings by age, but Live TV remains important across all age groups:

38% of adults ages 18-34 rank live TV as most important, compared to 41% of adults ages 35-54, and 49% of ages 55+
32% of adults ages 18-34 rank Netflix as most important, compared to 15% of adults ages 35+

Concluding, the report says that, taken together, data on viewer measurement and consumers’ perceptions are indications of the gradual evolution that is taking place in the video landscape. This transformation has not been immediate, nor has it been equivalent across demographic groups. Traditional TV and newer on-Demand and streaming services coexist today, and will continue to do so for many years to come, with consumers choosing the combinations that best fit the needs of their household.

Finally, considering the LRG study On-Demand TV 2014: A Nationwide Study on VOD and DVRs, these on-Demand TV services have permanently changed the options of how people may choose to watch TV.

66% of households with annual household incomes >$75,000 have a DVR – compared to 33% with incomes <$30,000
25% of current non-DVR households previously had a DVR at home
59% of all cable subscribers have ever used VOD – compared to 46% in 2009, and 10% in 2004
63% of digital cable subscribers, and 58% of Telco video subscribers, used on-Demand in the past month
36% of pay-TV subscribers get Netflix – compared to 48% of non-subscribers
36% of Netflix subscribers stream video daily, and 72% weekly – up from 10% daily, and 43% weekly in 2010
32% of pay-TV subscribers with Netflix stream Netflix daily – compared to 53% of non-subscribers with Netflix

This, and other related information, may be found on the current LRG report here.

dvrs, research, tv

4 comments about "Live TV Lives On".

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Douglas Ferguson from College of Charleston, January 15, 2015 at 9:18 a.m.
"and will continue to do so for many years to come" is reminiscent of the vague reminders ten years ago from daily newspapers that they were "not dead yet" -- at what point can we admit that linear TV's best years are behind it?
Reply

Ed Papazian from Media Dynamics Inc, January 15, 2015 at 9:46 a.m.

Douglas, you keep comparing newspapers to TV as if what happened to newspapers, regarding audience and ad revenue declines, parallels what's happening to TV. But TV viewing is at an all time high and is slowly rising as more and more channels and platforms become available. What's more, TV ad revenues are climbing, not in steep decline. The problems that newspapers had were two-fold. First, other media---TV ( mostly cable ) and the Internet usurped their news functions, while the latter virtually wiped out their classified ad revenues. TV is both an entertainment and a news medium, with the emphasis on entertainment; newspapers are a news medium and their emphasis, now, is increasingly on local and regional happenings. This is their new battleground, fought mainly against local TV and radio outlets, local cable and the Internet. Here, as well, the issues of timing and depth of reporting are at play. I suspect that the only hope for newspapers, long term, is to go for instant news via their websites and in-depth via their Sunday editions. Frankly, I don't see many daily print editions surviving. But my basic point is this------TV is not at all in the same boat as newspapers. It will adapt, when it has to.

Leonard Zachary from T___n__, January 15, 2015 at 2:52 p.m.

Ed define TV. Is it the free online feeds of sports programming available to anyone on the planet with a broadband connection? Yes.

TV not in the same point as newspapers? Define where? The U.S.? The younger audience if its to be viewed as a feeder for the future may actually not be there given the preference for request on demand versus linear and curated TV.

Selling less audience for more $$$ has been a neat trick for the past decade but advertisers are really getting smart. The methodology the major broadcast networks use to adopt is to lobby Congress for laws to protect their legacy interest just like retransmission fees.

Ed Papazian from Media Dynamics Inc, January 15, 2015 at 4:20 p.m.

OK, Leonard, let's define TV. I define it as an ad medium, including the programming of the broadcast TV networks, TV stations and cable channels. Sure, there may be some other forms and methods of access, but, on the whole, they don't amount to very much viewing----at least not yet. Where you and I seem to disagree is the extent to which TV, as I define it, is going to lose its audience tonnage to "other" forms of TV. By audience tonnage, I mean the volume of viewing, not merely small scale sampling and occasional exposures. I hold no particular brief for "linear TV" programming, nor am I opposed to alternative fare and methods of distribution. I just don't see the kinds of massive volumetric defections from linear TV----even among the younger set---that you may be envisioning. Advertisers will always follow the TV audience, wherever it goes, and, yes, some of the newer, emerging, fragments are of the "non-linear" variety. Moreover, they may grow, in share of total tonnage. Fine. But It will be quite some time before "linear" loses so much of its viewing volume ---or critical mass---that it becomes as dead as the proverbial Dodo----from an advertising standpoint. That's just my opinion.