New Report Says Streaming Services Have Reached a ‘Tipping Point’
Nielsen and Company, which has long measured television ratings, has released a new report on the impact of entertainment streaming services. While customers have flocked to streaming services and are overwhelmingly benefiting from their user experience, the economics of the industry remain uncertain.
The study concludes that the industry has “reached a tipping point”. What drove this, in large part, is that almost everyone now has access to the Internet. The pandemic has also pushed audiences to streaming services.
“The near ubiquity of Internet connectivity has exponentially fragmented the media landscape, providing consumers with seemingly endless ways to quench their thirst for content,” the report said. “In the fall of last year, more than 81% of American households had at least one device connected to a television, up from 72% in 2019. This connectivity, combined with the hundreds of direct-to-consumer options that offer everything from high-profile movies to DIY and adventure to sports programming has transformed the way we use our televisions.At the end of last year, Americans 2 and older spent 32% of their total time watching TV with devices connected to the TV (68% with traditional TV). children aged 2 to 17, the percentage was 64%.”
Another big change is that media companies are organizing their strategies around streaming and developing new shows for streaming services rather than cable networks.
Spend more on streaming
Because of this, Americans are subscribing to more streaming services. In 2022, according to Nielsen, 7% of respondents subscribed to six or more streaming services, 10% to five, 18% to four, 23% to three and 24% to two. In 2019, 33% subscribed to two and 35% to one, although there are more services available now than there were then.
“Audiences eat it, even when cost is a factor,” the Nielsen study said of streaming. “In fact, a recent custom survey found that 93% of Americans plan to increase their paid streaming services or make no changes to their existing plans. While mirroring those we surveyed, this data contrasts somewhat in line with market expectations by many, like Deloitte, of significant churn as the streaming wars escalate.
Indeed, Nielsen found that 15% of respondents spend $50 or more per month on video streaming services, while 17% spend between $30 and $49.99 and 21% spend between $20 and $29.99. . Consumers between the ages of 35 and 49 spend the most, according to the report.
As a result, many customers will be spending somewhere close to what they previously spent on cable on streaming services. Nielsen also found that many consumers are interested in bundles.
According to the study, 64% of respondents “wished there was a bundled video service that would let them choose as few or as many video streaming services as they wanted, more like channels,” while 46 % say they have trouble finding the streaming content they want because there are so many services available.
Increase in vMVPDs
Nielsen has also found that virtual distributors of multi-channel video programming (vMVPDs), such as Hulu + Live TV, YouTube TV and DirecTV Stream, are growing in popularity, especially with younger audiences. While 7.1% of all TV households subscribed to these services three years ago, that percentage has now reached 12.5%.
Another notable finding from the study is that there are 817,000 unique programs across all platforms, a number that was around 646,000 as recently as the end of 2019.
“While many of these titles form the bedrock of the traditional television universe, newer content, particularly in the past two years, has been developed for over-the-top (OTT) delivery in the ‘increasing reach of streaming services,’ the report said. mentioned. “And as choice proliferates, consumers will increasingly rely on content platforms and services to deliver the content that matters most to them.”
Lots of choices, maybe too many
Ultimately, consumers have more choices, but those choices have confused many.
“Today’s media landscape is a treasure trove of options for consumers, and the volume of streaming content continues to grow as platforms add more content,” Nielsen said in the conclusion. “With an audience-centric mindset, the media industry can help consumers find what they’re looking for and use what they know about their changing viewing behaviors to keep them engaged.
“And as consumers engage with new ad-supported options, marketers can take advantage of TV and streaming-specific segments to ensure they reach and engage with the audiences they want. Additionally, buyers and sellers can leverage streaming-rich media planning tools to identify the additional reach that streaming audiences bring to cross-platform campaigns to understand the full picture of who they are targeting.
The report follows news last month that Nielsen had agreed to be acquired for $16 billion by a private equity consortium including Evergreen Coast Capital Corporation and Brookfield Business Partners LP.
Stephen Silver, technology editor for The National Interest, is a journalist, essayist and film critic, who also contributes to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and connect today. Co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.