Streaming Is Challenging Live TV

I was in Europe this past week. While in Amsterdam, I noted a campaign singing the praises of watching soccer live on TV.

This has been TV’s most potent and frequently used weapon in the onslaught of declining ratings, viewership and cable subscriptions. The pitch is that for certain events, you want to watch it live because of the shared “specialness” of being part of the event as it happens.

The pitch has been used by TV stations the world over, for events as diverse as the World Cup, the Super Bowl, the Oscars, etc. The only problem with this argument is that it appears to be a “shifting truth.” Yes, fans of certain sports or events definitely like the idea of watching them live to feel a part of what’s going on — but the platform through which they choose to be part of it is evolving in line with shifting viewing patterns.

Don’t get me wrong. Linear TV was still the live-event king during the FIFA World Cup. In the U.K., where the national team finally remedied decades of disappointment, commercial broadcaster ITV broke ratings records with 26.6 million (an 84% audience share) watching the England-Croatia semifinal. And an average of 19.3 million French viewers (82.2% share) watched their national team take the trophy on national TV.



But at the same time, per a report on CNBC, content delivery network Akamai live-video-streamed 2018 FIFA World Cup content for more than 50 rights holders in more than 100 countries.

And video analytics company Conviva reported  a worldwide average of 64.6 minutes of viewing time streamed per unique viewer not watching the World Cup on traditional television.

It’s  that last part of the CNBC report that should worry traditional advertisers and broadcasters, because those number suggest that a large group of people tuned in live, but not on TV.

In the U.S. and Latin America, I am sure this trend was partially driven by the fact that there was a seven-to-10-hour time difference between Russia and the Americas. So if you wanted to watch during the working day, you had to tune in in the morning or early afternoon. Cue the tablets and mobile phones while seated behind your desk or elsewhere while at work.

I certainly did this. The Fox sports app was my FIFA World Cup friend.

The challenge is that revenues from live streams are not as high as commercial TV revenues. Some of the streaming services obviously charge, but the BBC stream is not behind a pay wall, for one example, and my Fox access came courtesy of my cable provider.

TV broadcasters are paying significant premiums for the rights to special events where they want their audience to congregate live in large numbers. But those audiences are set to continue to migrate to platforms more convenient, but where revenues are much smaller. And that does not bode well for traditional TV.

One report says online TV revenues will make up 5.2% of total broadcast revenues in 2018. That is well below the 20% audience share of streaming World Cup viewers. If the 5.2% vs. 20% is any indication, we should see a steady shift of ad dollars from OTT TV to streaming.

1 comment about "Streaming Is Challenging Live TV".
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  1. Jack Wakshlag from Media Strategy, Research & Analytics, August 10, 2018 at 2:57 p.m.

    Where are you getting a 20% share Maarten?  I don’t see anything in the article that says 20% of the Viewing was online or OTT. Even the Olympics were well below 5%. My guess is if you got the viewing right it would be below 5% but yielded more than that in revenue because advertiser demand there is high. 

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