Yet the television business is said to be dying. How can that be?
As it turns out, TV content remains incredibly popular. But television audiences are increasingly watching outside the L+7 ratings window. Moreover, those audiences are increasingly watching on devices other than TV sets, or they’re watching via OTT and SVOD, as opposed to traditional linear methods.
The result is that everyday, more and more audience isn’t being captured by legacy measurement.
This is a significant problem because revenues have always been tied to viewership. In effect, a legacy measurement system that began decades ago is crippling television’s ability to monetize its content today. But we shouldn’t confuse a measurement challenge with the overall health of the television industry.
What the television industry must do is adapt to technological changes in distribution as well as an ongoing evolution in consumer behavior. The question is how?
It wasn’t too long ago when the only metrics that mattered in television were those that counted live viewership. But it wasn’t until DVR technology had reached a tipping point (and perhaps even several years after that moment) that the industry began to see viewership as an extended window—first a few days, ultimately, a week.
In that sense, the television industry has been chugging along toward a new metric for years.
Today, the industry uses L+7 as its metric, but everyone understands that L+7 is a temporary fix; soon enough, the window will widen to weeks, months, and perhaps even years. Eventually, television executives may even think about viewership in the same way that their digital counterparts touted the virtues of the long tail.
That progression, from live to some arbitrary point after a live broadcast, isn’t new, and it isn’t going to address the fundamental challenge facing the television business.
What is of paramount importance today is that up to 50% of is already happening outside the current window, depending on the program. On the one hand, that’s good news for the television industry because it speaks to the growing appeal of content.
But that fact also highlights an ongoing crisis, because a failure to measure today’s audiences is a significant impediment to understanding a new pattern of consumer behavior.
Rather than moving the cut off line to L+14 or even L+30—metrics that are only relevant to advertisers—television companies need to think in terms of consumer behavior. The real question is no longer how many consumers are tuning in at an appointed time, but rather what share of total screens (TV sets, tablets, mobile, etc.) can your content capture?
Yes, viewers will consume that content through a range of platforms—OTT, SVOD, download—but ultimately, the method of distribution should only be a planning challenge for the content company.
The value of the content, on the other hand, must reflect the share of the total audience video audience, regardless of whether that audience is linear, OTT, online, or mobile.