TV’s Detour

Waves of disruption

The TV industry is constantly going through change. Focusing just on the last twenty years or so, we’ve seen several waves of disruption:

  1. Boxes – TiVo, Slingbox, and others, which allowed viewers to take the content they traditionally had to consume where and when it aired on their televisions and move it through time and space, digitally
  2. Piracy – file sharing, YouTube, and a myriad of other sites and services made it easy for viewers to consume the content they couldn’t find anywhere else, without paying for the privilege
  3. Legitimate online services – the next wave was an increasing legitimization of online options for consuming video, as YouTube began to respond to lawsuits, Netflix began to offer streaming, and Hulu emerged as a first attempt by many content owners to re-engage with viewers.

One of the consistent themes in almost all of this disruption has been a two-fold shift:

  • A move away from the television and towards other devices
  • A move away from traditional providers of paid television services

In this piece, I’m going to focus on the first of these shifts but I’ll touch on the second briefly at the end and likely come back to it in a future post.

A permanent shift or just a detour?

The big question in my mind has always been to what extent these trends were inevitable and inexorable and to what extent they represented a temporary detour from past patterns to which users would return to in time. I’ve always favored the latter explanation myself and we recently got some interesting insight from Hulu on this point. Hulu’s Peter Naylor did a blog post about viewing habits. He shared some statistics about how and where people consume Hulu – note that what is labeled OTT in this chart Hulu calls “living room viewing” in its description:

As with many of the other disruptions outlined above, the primary vehicle for viewing video with Hulu was at first the PC. But even as early as Q1 2014, Hulu saw living room viewing overtake PC viewing and it’s now by far the dominant method of watching Hulu. All this is important, because what it suggests is people didn’t view video content on their PCs as a matter of device preference, but as a matter of availability and convenience – they knew how to watch Hulu (or Netflix or YouTube) on their PC, but didn’t have a way to do so (or couldn’t figure out how to) on their television. As such, what has appeared to be a shift away from the television over the last several years may have been – at least in some cases – a temporary phenomenon, which will fade over time as the adoption of smart TVs, connected Blu-Ray players, boxes like Roku, Apple TV, and Fire TV increase, making TV-based consumption even easier than PC-based consumption.

Mobile in the minority

Of course, the other piece that’s growing, which usually gets far more attention, is mobile. But it’s grown from 15% to 17% over the same period that what Hulu calls “OTT” grew from 44% to 58%. Mobile is important, but the vast majority of Hulu viewing (and of TV viewing in general) is happening in the living room, not while truly mobile. One caveat: Hulu’s “OTT” category appears to include something it calls “connected devices”, which might include tablets. Why would someone use a tablet in their living room rather than the TV? I see a couple of possible reasons: convenience (it’s still easier to just watch using a connected tablet than figure out how to do it on my TV), and solitary viewing. It’s the combination of that latter trend – viewing TV alone rather than in couples or larger groups – combined with truly mobile viewing that’s going to stick, at least to some extent. But the evidence from Hulu and other data suggests it’s small in comparison to the majority of people who still prefer to watch TV programming on the largest screen in the house. What you end up with then is this picture:

TV Detour

The other shift looks equally vulnerable

The other shift I mentioned was the shift away from traditional providers of paid television services. So far, the rise of Netflix in particular and, to a lesser extent, Amazon, Hulu, and others suggests we are indeed seeing this shift continue. However, we’ve also seen the major pay television providers respond to almost all of the disruptions by these new players over the last several years, though imperfectly in some cases. I’m not going to focus on this shift here but, suffice to say, I suspect the pay TV providers will hold up (and hold share) much better than a lot of people are assuming. The disruption we’ve seen in the industry has moved at a relatively slow pace and that’s given these players time to adjust their models and find ways to respond to almost all the major changes occurring around them, with one exception. But that’s a topic for a future post.

Published by

Jan Dawson

Jan Dawson is Founder and Chief Analyst at Jackdaw Research, a technology research and consulting firm focused on consumer technology. During his sixteen years as a technology analyst, Jan has covered everything from DSL to LTE, and from policy and regulation to smartphones and tablets. As such, he brings a unique perspective to the consumer technology space, pulling together insights on communications and content services, device hardware and software, and online services to provide big-picture market analysis and strategic advice to his clients. Jan has worked with many of the world’s largest operators, device and infrastructure vendors, online service providers and others to shape their strategies and help them understand the market. Prior to founding Jackdaw, Jan worked at Ovum for a number of years, most recently as Chief Telecoms Analyst, responsible for Ovum’s telecoms research agenda globally.

368 thoughts on “TV’s Detour”

    1. Not sure what BR is there. And the answer is that it depends who’s providing it. Next week, I’ll probably follow up with a piece on the other shift I described in more detail. The pay TV companies provide on-demand too, which means they are embracing this disruption (along with several other forms). They’re still conflicted about it because they often don’t get paid as well by advertisers for on-demand as for live, but they’ve come a long way.

    2. A bit of both, I think.

      Really, The uses for the “broadcast schedule” version of TV is getting slimmer and slimmer all the time – basically right now it’s surviving on time-sensitive events and brainless “whatever’s on” watching. If a demand-based service provider builds a “just show me something i haven’t seen that I’ll like” button, then that’ll have the ability to kill ‘whatever’s on’ TV watching dead (because no broadcast schedule can ever have Netflix’s knowledge of what I enjoy watching), leaving just time based events.

      More and more, I’m thinking that traditional schedule-based TV is really only being kept alive by force of habit (which has a limited lifespan as viewers die/learn new habits) and events coverage.

      1. Broadcast TV does keep a social aspect (everyone’s on the same schedule, so you can discuss it at the playground/recess/watercooler/teatime), and a curation aspect (music stores are getting kudos for reinventing radio, let’s not un-invent broadcast TV too quickly ? :-p)

        1. Right now on-demand services are second-class citizens when it comes to mainstream TV shows (ie, they get the episodes after a delay, if ever). Which causes the services differentiate themselves by releasing those shows they do get all at once instead of one episode per week. That second class status isn’t going to last forever.

          Eventually, Netflix et.al. will start releasing some shows the way they’re released now on TV, one episode per week, instead of dumping everything in season-at-a-time chunks. Some kinds of storytelling benefit from a chapter-at-a-time release schedule, others benefit from an all-at-once schedule.

          So the social aspect of watching the newest episode when it first airs is currently part of TV and not part of demand services only because the content producers have artificially restricted how and when shows get released to different channels.

          As for curation, Netflix does a lot of that already. Netflix’s competitors are idiots if they don’t do the same.

      2. Agreed. In the era of the fandom I don’t think scheduling matters as much. I see this with my own kids, they’re plugged into communities that dig the same shows/characters/worlds, and everyone watches episodes on their own time. New fans discover a show and catch up via binge watching. There is some element of time sensitivity when major events happen plot-wise, but even this is staggered and time shifted quite often, usually by a few days at most, but still, it just doesn’t seem as important to be watching right when something is on. We already PVR and time shift almost all our TV viewing. The only thing I watch in real time is the Stanley Cup Playoffs, and not even all the games, just one or two teams I like.

        It is interesting that Apple is working on curation of content, and seems to be doing a very good job with music. My kids are testing Apple Music, and love it. They’ve used lots of other streaming music services. The thing I hear over and over is how much new music they’re discovering. And they love the radio station, Beats 1. Anyway, good curation can add a lot of value to content.

  1. So what drove a change in OTT from 44 to 58 percent in 2014? It’s not like Smart TVs or Roku just happened. Fire TV launch is the only significant change to the 2014 OTT market I can recall and it’s hard to believe it had that effect. A single year seems like a strangely short period for identifying a cultural or industry trend.

    I’d also wonder about the rise of ad blockers that possibly make tracking via computer less available. People can only watch the same two commercials on Hulu so many times in a row before seeking solutions to stop them.

    I’ll admit an informed bias and say I don’t trust Ad Sales guys with data they present to the public. They’re the most full of bleep people I’ve ever run across and incentivized to paint a false picture so snake oil can be sold to suckers.

    But yeah, I think “cord cutting” has always been a big misnomer. I wasn’t watching football on my 15″ laptop because I wanted to.

  2. My question is, to what extent will mobile force the networks (the content providers) to change? I seem to have read that advertising doesn’t work well on mobile. If it doesn’t, what will the networks do about the situation?

  3. Not that long ago either you or Bob had some figures on TV viewing by age group. I wonder how Hulu’s figures would look parsed out by age.

    Joe

  4. This analysis is pretty spot-on for our family. In fact, we even connected our computer to our TV in 2009 to support watching downloaded content on our TV rather than on a computer monitor. Afterwards we purchased an Apple TV and other set-top box solutions to continue to watch content on the TV rather than a small-screen monitor. My son uses his tablet to watch TV in his bedroom at night, but he still prefers to watch content on the living room TV using a streaming device.

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  141. Tiêu đề: “B52 Club – Trải nghiệm Game Đánh Bài Trực Tuyến Tuyệt Vời”

    B52 Club là một cổng game phổ biến trong cộng đồng trực tuyến, đưa người chơi vào thế giới hấp dẫn với nhiều yếu tố quan trọng đã giúp trò chơi trở nên nổi tiếng và thu hút đông đảo người tham gia.

    1. Bảo mật và An toàn
    B52 Club đặt sự bảo mật và an toàn lên hàng đầu. Trang web đảm bảo bảo vệ thông tin người dùng, tiền tệ và dữ liệu cá nhân bằng cách sử dụng biện pháp bảo mật mạnh mẽ. Chứng chỉ SSL đảm bảo việc mã hóa thông tin, cùng với việc được cấp phép bởi các tổ chức uy tín, tạo nên một môi trường chơi game đáng tin cậy.

    2. Đa dạng về Trò chơi
    B52 Play nổi tiếng với sự đa dạng trong danh mục trò chơi. Người chơi có thể thưởng thức nhiều trò chơi đánh bài phổ biến như baccarat, blackjack, poker, và nhiều trò chơi đánh bài cá nhân khác. Điều này tạo ra sự đa dạng và hứng thú cho mọi người chơi.

    3. Hỗ trợ Khách hàng Chuyên Nghiệp
    B52 Club tự hào với đội ngũ hỗ trợ khách hàng chuyên nghiệp, tận tâm và hiệu quả. Người chơi có thể liên hệ thông qua các kênh như chat trực tuyến, email, điện thoại, hoặc mạng xã hội. Vấn đề kỹ thuật, tài khoản hay bất kỳ thắc mắc nào đều được giải quyết nhanh chóng.

    4. Phương Thức Thanh Toán An Toàn
    B52 Club cung cấp nhiều phương thức thanh toán để đảm bảo người chơi có thể dễ dàng nạp và rút tiền một cách an toàn và thuận tiện. Quy trình thanh toán được thiết kế để mang lại trải nghiệm đơn giản và hiệu quả cho người chơi.

    5. Chính Sách Thưởng và Ưu Đãi Hấp Dẫn
    Khi đánh giá một cổng game B52, chính sách thưởng và ưu đãi luôn được chú ý. B52 Club không chỉ mang đến những chính sách thưởng hấp dẫn mà còn cam kết đối xử công bằng và minh bạch đối với người chơi. Điều này giúp thu hút và giữ chân người chơi trên thương trường game đánh bài trực tuyến.

    Hướng Dẫn Tải và Cài Đặt
    Để tham gia vào B52 Club, người chơi có thể tải file APK cho hệ điều hành Android hoặc iOS theo hướng dẫn chi tiết trên trang web. Quy trình đơn giản và thuận tiện giúp người chơi nhanh chóng trải nghiệm trò chơi.

    Với những ưu điểm vượt trội như vậy, B52 Club không chỉ là nơi giải trí tuyệt vời mà còn là điểm đến lý tưởng cho những người yêu thích thách thức và may mắn.

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