All of that is changing.
A few weeks ago, I was at a friend’s house and he was watching a basketball game. I knew he had cut the cord months ago and did not think he had made the jump to a vMVPD. How was he watching the game? He pointed to a flat piece of what looked like plastic lying next to the TV, completely unobtrusive.
“I didn’t want to pay for cable anymore and that thing cost $40. I get HD quality TV. Why pay for TV when TV is free? Between the antenna, Netflix and Amazon, I don’t feel like I’m missing anything.”
No, my friend is not your grandmother who doesn't know how to use the remote. He is a tech-savvy millennial who makes a healthy six figure salary, owns his home and has all the latest technology (Google Home, Ring doorbells, voice-controlled lights). While he is a personal anecdote — and you cannot draw conclusions based on an anecdote — he is a prime example of a larger trend observed in quantitative and qualitative research.
Data from Horowitz’s report, "State of Pay TV, OTT & SVOD 2019," reveals that while a lot discussion in the TV industry centers on vMVPDs and SVODs, a trusty old technology — the antenna — has begun an under-the-radar re-emergence. According to the report, a full third (34%) of TV content viewers report using an antenna in their home.
Antenna owners are younger (40% are 18-34 vs. 31% of total TV viewers) and skew male (59% vs. 49% of total TV content viewers).
When cable TV came onto the scene, its promise was no more fiddling with antennas and it would deliver a wider variety of content. For a long time, it seemed like cable (and later satellite and telco) TV was the way of the future. The antenna became a relic.
Today, many viewers are turning to SVOD services like Netflix, Amazon and Hulu for their breadth of content, and more viewers are coming to rely on streaming for TV content. What is missing from the SVOD services? Live sports, local broadcasts and national news.
Where Antennas Come In
That’s where antennas come in. Antennas are more popular among traditional MVPD nonsubscribers and SVOD subscribers: 51% of MVPD nonsubscribers have an antenna (vs. 30% of traditional MVPD subscribers), and 83% of antenna users subscribe to an SVOD service (vs. 67% among total TV content viewers).
Further, with newer technologies that allow for using DVR for over-the-air content, including TiVo’s Bolt OTA, Plex, and Amazon’s Fire TV Recast, viewers are finding ways to piece together ‘cable service’ using SVOD services and over-the-air broadcasts — at often dramatically reduced cost.
Most importantly, TV and streaming technology is improving to the point where accessing different sources of video is no more difficult than navigating a cable set top box menu. For example, during some recent in-home visits, I saw firsthand how easy it was to switch from Netflix to antenna TV.
On many TVs, antennas show up as an “app,” not even requiring an HDMI input change (or facilitating it automatically). Broadcast TV is already available in full 1080p HD. With the advancements from ATSC 3.0, 4K picture is not far off.
When Horowitz was founded in the 1980s, the question was: “Who will pay for TV when TV is free?” Now, it seems, we’ve come full circle.
("The State of Pay TV, OTT & SVOD 2019" report is based on a mixed phone/online survey conducted in January/February 2019 among 1,600 TV content viewers (i.e., watch 1+ hours of TV/day). The survey was offered in English and Spanish. All data have been weighted to ensure the results are representative of the TV viewing universe.)
Stephanie, just a point on the findings. According to Nielsen only about 14% of all TV homes accessed content via over-the-air reception last year. The current percentage, per Nielsen---is probably only 15% or thereabouts---which is a far cry from the Horowitz finding of 34%.