How Much is the TV Experience Really Changing?

Blog Post created by jthibeault on Aug 11, 2015

A recent study by PwC revealed some interesting data about the changing television experience. Surveying 511 kids and teens (ages 8-18), the study found that although kids admittedly like online video streaming, they watch more conventional television. According to the report, "More than half of 8-to-18 year olds say streaming TV shows on the Web are their favorite type of programming...But, on average, they are spending 7.8 hours a week watching network TV shows and movies live, more than the 6.1 hours spent streaming shows or movies on a laptop, tablet or phone."


Now you might be nodding your head right now and saying to yourself, "I knew it. Cord cutting is just a bunch of hype." But before you jump to any conclusions, let's put the PwC report into perspective.


First, the target of the survey was a very young demographic. According to the PwC report, "...while older kids and teens show a preference for consuming content on laptops or mobile devices, younger kids (age 8 to 11) prefer the traditional TV screen...that may be driven by parents, who tend to exert more control over kids’ media habits until they reach high school age..." If nothing else, the report clearly illustrates that this demographic consumes a lot of media each week across a variety of channels.




Beyond the seemingly obvious revelation that kids consume a lot of media, the report doesn't reveal much about the state of online video versus traditional television because the current state of online video is largely geared to an adult audience...an audience that might be likely to pay for that content (whether that is directly or indirectly through a third-party provider like a cable company; HBO is a perfect example of this as they provide their content freely online via HBO GO to existing subscribers). Kids and teens have little opportunity to view online content for free outside of YouTube (which may account for the meteoric growth of YouTube stars) and there probably aren't many parents willing to provide a credit card to enable their children to subscribe to OTT services. But it's clear kids and teens want to watch online video, as the study reveals, yet it's also obvious that they don't have many sources. We could probably intuit that the "short videos" depicted in the graph above come entirely from YouTube and represent only .6 hours (36 minutes) less than the time they spend watching "drama or reality series on cable channels."


So what's really happening with the television experience? Well, first, it's reported that more and more people are dropping their cable subscriptions. And logically, we have to assume that people are either not watching television any more (not likely, given the PwC report data nor from our own The State of Online Video report) or they are watching their content from another source such as online. Second, we are only in the infancy of online video. Yes, more direct-to-consumer content packages are coming into the market (i.e., Dish Network's SlingTV, CBS All Access, etc.) but the amount of available content online is a fraction of what's available through terrestrial broadcast. Third, broadcast still provides a better overall experience with video content than online. There is no chance of buffering. There is little chance of signal interruption. People intuitively know "online" is not as bullet proof as broadcast and it only takes a few bad experiences to color perception, sending people running back to the television with which they are familiar. Online video is just not "broadcast quality" yet. Fourth, although broadcast still consumes the majority of video time amongst kids, teens, and even adults, online video provides a level of control (i.e., watch what you want, when you want, where you want) that is very appealing to consumers. And, lastly, there is too much disconnection between the various devices that people use to watch video content. Smart TVs. PCs. Tablets. Connected set top boxes (i.e., Apple TV, Roku). None of them are talking to each other, which creates a very fragmented television experience.


The television experience is definitely changing. And even if the report doesn't tell us anything about cord cutting, it does illustrate the fundamental evolution. Kids are growing up with access to content through an "online channel," something with which no other generation was born. They will enter their adult lives knowing two different video experiences: online and traditional broadcast. But it's also clear that these experiences need to unify. The fragmentation isn't good for anyone, broadcasters or online video publishers. It won't surprise me over the next 5 to 10 years (that's how long it's going to take to really unify the experiences) to see content owners, cable operators, and other savvy technology companies working hard to solve the critical challenges facing this evolution. Because the one that does will successful create the new "television experience" and control the landscape of video content no matter where it's consumed.