Nielsen, the gold standard in TV ratings, has just made an important discovery about smartphones: all those people walking around staring at their phones are not watching video. At least, not very often or for very long. They aren't streaming much audio either.
Companies like Facebook, YouTube and Netflix would have you believe that people are spending their lives binge-watching internet-delivered TV on their TVs, smartphones and tablets. So much so, people are cancelling their cable and abandoning traditional TV. The use of these Internet video services is greatly exaggerated. For example, Netflix says that its subscribers account for 125 million hours of TV shows and movies daily. But that is in over 190 countries. Canadians alone watch almost that much traditional TV each day.
Nielsen, using cutting edge hardware and software, is now measuring video and audio on TV sets, TV-connected devices (such as Apple TV and Roku), PCs, tablets, smartphones and, of course, traditional radios. The Nielsen data tell a story that should embarrass a few TV industry executives, who have gambled the future on the rise of smartphones and other digital devices.
The 2016 Nielsen results will surprise those pundits who claim that traditional TV is being killed off by the Internet. First: only 6% of all video consumption takes place on PCs, smartphones or tablets; smartphones by themselves account for less than 1%; tablets even less than that. Second: an additional 10% of video consumption is via devices connected to the TV set, such as DVDs, video games and Apple TV. All the rest, 84%, is regular live TV viewing on a TV set, plus a small amount of video playback. I guess my elderly aunt was right when she said, who would watch TV on their phone. Almost half of people do watch video at least once per week on their phone but they do so for only about 20 minutes a week. TV viewing time is almost 100 times greater. Likewise, traditional radio has an audience more than 20 times larger than audio streaming on smartphones, according to the same Nielsen research.
Even Millennials (adults 18-34) only watch video on their smartphone for 41 minutes per week but spend over 1,200 minutes watching traditional TV weekly. Younger adults, many of whom have yet to subscribe to cable, do spend almost twice as much time with devices connected to TVs, such as Apple TV, DVDs and video games, but evidence suggests this may have peaked and will only grow if cable companies offer Internet-delivered versions of cable, i.e., bundled traditional channels. No question that traditional TV viewing has declined among younger adults in the past five years but it has mostly been replaced by video streaming of TV shows and movies on conventional TV sets. In essence, Millennials aren't watching less TV, just using a different delivery mechanism.
The 2016 first quarter data show increases in smartphone and tablet video compared to the year earlier but since smartphone and tablet ownership (as well as subscription to Internet TV services such as Netflix) seems to have peaked, it is likely that there will be minimal change in future. These are U.S. data but I have no doubt Canada is similar, even though we have fewer Internet TV services available.
The CRTC recently issued a new TV policy assuming that so-called digital TV was rapidly replacing "linear" or traditional TV. But it seems the policy applies to only a small minority of the population, those who have cut or never had cable or were probably never that interested in TV in the first place. The Commission may have been duped by the voluminous data that Internet TV services issue for marketing purposes.
For example, a sketch comedy that you have probably never heard of, Baroness Von Sketch Show, recently touted that its premiere on Facebook had 1.7 million "views." Sounds big. But a view can be as little as 3 seconds and the number quoted is equivalent to the total number of people who shop at a store say in a year, as opposed to the average number of shoppers in the store.
The average is the metric used for decades by traditional TV industry to gauge success. Moreover, the view numbers are not provided by an independent, third party like Nielsen but by Facebook and are considered by many to be misleading.
The traditional TV industry is starting to fight back and debunk the hyperbolic audience claims of digital producers. Nielsen's latest research has gone a long way to help in that regard.
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