Commentary

Streaming Up, But TV Advertisers Have No Worries

A new report from Pivotal Research Group says before you conclude everything you know and hold dear is a big fat lie, listen to this: TV is not dying.

I’m not so sure anyone really was asking (or, to be fair Pivotal was pegging its report that way), but it just makes clear TV viewing has not fallen off a cliff. It’s more like it has stumbled off a curb.

In the average home, TV watching has only fallen by about two hours in the last two years. Despite the avalanche of new streaming opportunities, we spent an average of 68.3 hours a week watching TV during Q1 of 2017, which compares to 70.1 hours a week in the first quarter of 2015, a Campaign report on Pivotal’s study says.

Homes with SVOD service watch 64.3  hours of TV per week, while those without on-demand services watch 73.5 hours, a figure Pivotal’s Brad Wieser suggested was not enough to get excited about, yet.

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"Relatively few [consumers] have ‘cut the cord’ to rely exclusively on ad-free SVOD services, meaning that TV can mostly work much as it had in the past for large advertisers," he told Campaign.

Well-regarded pros like Wieser, who occasionally report the sky isn’t falling, are the natural enemies of people and businesses that like to think of themselves as “disruptive.”  

To some degree at least, digital marketing to advertisers relies on convincing them the whole subject is loaded with so many new metrics and viewing patterns that really, you just gotta believe. I hate to say it, but Nancy Pelosi’s suggestion to legislators to pass a bill so they can discover what’s in it seems to be increasingly useful advice in the digital realm.

No doubt the universe is changing. Pivotal also reports that as of the end of Q1 2017, 58% of homes have SVOD services, compared to just 43% a year before. That may be a telling stat. You can’t watch what you can’t see. As more people acquire SVOD services, obviously, its use will increase.

Netflix is spending $6 billion on programming, and Amazon just slightly less, to seem irresistible to new and existing customers.

“The movement of consumers away from traditional media viewing and toward streamed online content continues to accelerate, forcing companies across industries to plot new strategies,” says a new Deloitte ‘Digital Democracy’ Survey which refers to a “digital landscape perpetually disrupted.”

When Deloitte looks at who is watching, it finds 60% between the ages of 14-50 are now subscribing to at least one paid digital service--consistent with Pivotal’s headcount.

But the Deloitte survey of more than 2,000 consumers finds millennials put far more value on paid streaming services than pay TV, and that combining all the demos, two-thirds say the only reason they stay with pay TV is because it’s part of a (supposedly money-saving) cable/Internet/phone package.

It is true that cable cord cutters are far, far outnumbered the bundle-dependent. And things are changing.

pj@mediapost.com

1 comment about "Streaming Up, But TV Advertisers Have No Worries".
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  1. Douglas Ferguson from College of Charleston, April 13, 2017 at 2:57 p.m.

    I suspect the "not dying" is better interpreted as "very slowing becoming useless as an advertising medium," although just "how slowly" depends on how long the slow-adopters stay alive and how happy the agencies are not scoring with younger viewers who stream a disproportionate amount of their non-sports programming.

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