February 27, 2009 - There has been much disagreement regarding the extent to which (if any) viewing online video impacts the amount of time spent watching regular TV. Just this week, a barrage of press offered up Nielsen's latest "three screen" data regarding current video viewing time and concluded that, no, viewing greater amounts of online video is not dilutive to regular TV viewing.
Industry insiders are spinning this data to proclaim that "the death of linear TV" has been widely exaggerated and that it can withstand any threat from online video. Seems to me they are overlooking a rather obvious fact: consumers are watching more TV because they are spending more time at home and less time (and money) going out. It has nothing to do with their use of online video.
That being said, past TDG research has found little evidence to confirm the hypothesis that more time watching online video means less time watching regular TV. The data simply didn't support this conclusion. Our latest research, however, offers a different picture. This Chart of the Week provides a real-time snapshot of how consumers perceive the impact of their online video viewing on TV viewership. Adult broadband users were asked the following question:
How has watching online video programming affected the amount of time you spend watching regular TV programs? Use a 7-point scale to answer, with "1" meaning "I'm watching much less regular TV than before," "7" meaning "I'm watching much more regular TV than before."
TDG has used this formulation in the past and, as previously noted, the impact was unimpressive. Equal numbers of consumers were positively impacted (watching more TV) as were negatively impacted (watching less TV), with the majority answering "4" or "about the same as before." The most recent data is featured below.
TDG has used this formulation in the past and, as previously noted, the impact was unimpressive. Equal numbers of consumers were positively impacted (watching more TV) as were negatively impacted (watching less TV), with the majority answering "4" or "about the same as before." The most recent data is featured below.
Instead of a 1:1 ratio of "watch less" to "watch more," it is now a 2:1 ratio.
It is important to note that the majority of both groups fall within the "middle three" responses (that is, answers of "3," "4," or "5"), suggesting that the perceived impact of online video viewing on TV viewing remains relatively modest. That being said, the direction of the trending is undeniable. Hey, you don't have to listen to us. Just ask Comcast's CEO, Glen Britt. He seems to get it, recently warning that the company is "starting to see the beginnings of cord cutting where people, particularly young people, are saying, 'All I need is broadband. I don't need video.'"
If incumbent Pay TV operators believe this phenomenon to be real, it might be time to tune out the old-school evangelists convinced that TV - as we know and love it - will remain immune to the impact of online video. They are deluuuuusional, as Lew Black would say. TV will still dominate as the preferred viewing screen, but as the Internet finds its way into the living room, "TV programming" and the "TV experience" will be changed, fundamentally and forever.
Note: The implications of this shift on the strategies of cable operators were the subject of this week's TDG Opinion, In the Rush to Push Cable Programming Online, Are Operators Leaving Money on the Table? If you're interested in this topic, you'll find it to be an interesting read.
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