TV as we know it is dying, but most people don't perceive yet the dramatic change that is bubbling below the surface. In a stunning report released at CES, Accenture points to a wholesale collapse of traditional TV viewing. The study found that "the percentage of consumer watching broadcast or cable TV shows, movies, or videos on TV in a typical week plummeted from 71% in 2009 to 48% in 2011."
And what are we doing instead? We're streaming content on iPads (my wife watches as much content on her iPad as she does on TV), video enabled smart phones, and PCs. YouTube, Netflix, Hulu, iTunes -- and Apple's soon to be launched iTV are all changing the way we consume video content.
On Thursday, Robert Kyncl, YouTube's Vice President of Global Content Partnerships keynoted at the at 2012 Consumer Electronics Show in Las Vegas.
He argued that the world of TV is changing profoundly: "If YouTube's top five channels were stacked against cable channels, they would be in the top 20 in terms of viewership."
Kyncl pointed out that in 1980 there were only four TV channels and they had 100 per cent of the audience. But the emergence of cable TV in the 1980s dramatically changed the economics of distribution and resulted in hundreds of new channels. By 2010, 75 per cent of Americans viewing was spent watching cable channels, but only 25 per cent with the original four broadcast networks.
We are going through this same revolution again, with the Internet and streaming media once again dramatically reducing the cost of distribution. It eliminates barriers to entry, enabling content developers to narrow cast highly target audiences.
For instance, Kyncl cited the fact that today there are 17 million American yoga enthusiasts (and probably double that worldwide), yet there's not a single dedicated yoga channel on traditional TV. Kyncl predicted that within 12 month there will be a very successful YouTube Yoga channel.
And the facts speak for themselves: 350 million videos are shared on Twitter every year; and more than 100,000 person years worth of YouTube videos are watched on Facebook annually.
On hundred million iPads and tablets will be sold in 2012 according to the Consumer Electronics Association and analysts from GfK. Add that to the existing installed base of 70 million (15M in 2010 and 55M in 2011) -- all of them able to stream content; add to that the 600 million video enable smartphones that will sold in 2012 (add this to the 700 million smartphones sold in the last two years: 262M in 2010 & 435M in 2011); and finally add the 1.25 billion PCs worldwide. Presto, you're looking at more than 2 billion devices that can stream content.
By comparison there are only 115.9 million TVs in the U.S. and 1.6 billion TVs worldwide.
I can hear what some people saying: What about quality? Do you agree that the quality of a cell phone conversation is less than a landline? Absolutely. Well, if the quality is poorer, why did 1.6 billion people buy mobile phones last year? (There are now 5.6 billion mobiles worldwide.)
We all think that quality matters, but convenience trumps quality. I was at an IDC breakfast briefing and the analyst presenting asked how many people had HD TVs in their homes. The majority did. And then she asked how many also subscribed to Netflix (only $8 a month for unlimited movies), again the majority did. Now this is a techie audience -- but the point is that Netflix isn't in HD but we're happy to watch it because it offers greater choice.
Kyncl in his keynote pointed to the fact that, "Today Netflix streams more than two billion hours of content a quarter and Hulu has 30 million unique users a month."
"Online video is on fire," said Kyncl -- the speed of its adoption is accelerating.
YouTube's audience of 800 million people watches over 3 billion hours of video a month - that's 30 minutes of video for every person on the planet.
Kyncl noted that by 2013, 90 per cent of Internet traffic will be video -- and so the rapid rise of internet video and streaming spells the slow death of TV as we know it now.
More later on the implications of this in future blogs . . . stay tuned
Follow Jim Harris on Twitter: www.twitter.com/@JimHarris
RMontpellier - BoomerWarrior
Kyncl in his talk pointed out that pre 1980 the 4 networks had 100% of market share, today it's only 25% -- cable has the other 75% of traditional TV. He predicted -- and I agree with him -- that traditional TV will only have 25% market share and narrow casted, streamed content will take 75% of viewing time.
The only valid point you almost made is that people are device agnostic when it comes to watching TV. But that doesnt change the fact that the value proposition is defined specifically because they are on TV and the TV show still benefits when its watched. Regardless of device.
Just as movie grosses from Theatrical and VOD still determine how much Netflix pays for a movie, and popularity of a show still determines how much it gets downstream, TV shows wills still be the foundation for revenues for a long, long time.
Non TV shows will still be digital nickels vs digital dollars of traditional TV.
Youtube will do all it can to change that , but its going to be difficult. And just like traditional TV, most of the programs it invests in will fail miserably
That said, the interactivity of being on the web, viewing, reading and listening becomes an interactive experience because one can share with friends items that are of common interest.
to increase their reading time, spend more time speaking with family, friends and collegues,and to start thinking for themselves, instead of repeating the common diatribe that passes for common thought.
Technology has allowed for ease of communication and industriousness, but has left most people
disconnected with one another to the point that no one is really communicating with one another.
In all things moderation. Self reliance and the ability to think for oneself is the greatest attribute
that any person can truthfully ascribe and attain in our modern world.
to narrow cast highly target audiences.
And the fact speak for themselves:
On hundred million
600 million video enable smartphones
that will sold in 2012
I can hear what some people saying:
I figure I'd better draw attention to my own weaknesses as surely, someone else will rightly feel compelled to do so.
I'm not sure what I like the most, saving $100 a month or paying back ma bell for all those years of poor customer service.
I disconnected the cable TV four years ago and don't miss it.