‘New Media?’ No Longer The television industry is adjusting to its maturing digital dilemma 8 MULTICHANNEL NEWS JANUARY 8, 2018 multichannel.com SPECIAL REPORT VIEWER WATCH 2018 MULTICHANNEL NEWS began publishing its annual Viewer Watch Special Report in 2006 with an eye toward seeing how the changing use of video was transforming the TV business. It is extraordinary what has happened in the ensuing years to digital media, which was long referred to by executives as “emerging” and “new media.” Early on, they debated some issues that now seem quaint. Should cable networks put their content online? Was it wise to sell their content to Netflix? Why would anyone watch video of dubious quality streamed over the internet when they could view it on a beautiful, large TV in this emerging video standard called high-definition? Often the discussion veered into apocalyptic terrain. Will Google Fiber wreck the pay TV sector? How fast will cord-cutting destroy the cable industry? Or, alternatively, just how quickly will young people return to the pay TV fold as they get older and presumably wiser? Over time, discussions of the power — or poverty — of new media have thankfully disappeared. In transcribed interviews with 22 TV executives and researchers for this 2018 report, the phrase “new media” appears not at all — and for good reason. Heading into the New Year, Magna Global was predicting that the digital media ad spend would exceed TV advertising revenues by more than $30 billion in 2018 and that it would hit $105 billion in 2019, slightly more than the $101 billion PwC is predicting consumers will spend on pay TV subscriptions. And those trends make many of the central business and economic issues that have long been the obses- sion of this report more relevant than ever. If new media has passed into a mature media, the old questions of how to make money from video content or craft consumer-pleasing products are now central. Given the difficulties many face in turning those old problems into newfound profits, we hope that this report will once again help readers understand the major trends that will impact their businesses in 2018 and beyond. As usual, we are indebted to many people who helped with this report. In addition to the executives at pay TV operators, networks, OTT players and research firms who generously gave of their time, many research companies also contributed their insights and data. Among those, we’d particularly like to thank Frank N. Magid Associates, Horowitz Research, Magna Global, PwC, Nielsen and SNL Kagan for sharing their data with us. n Contributing writer George Winslow compiled the data, con- ducted the interviews and wrote the articles for this report. BY GEORGE WINSLOW @GeorgeWinslow Thinkstock
Transcript
‘New Media?’ No Longer The television industry is adjusting to its maturing digital dilemma
8 M U L T I C H A N N E L N E W S J A N U A R Y 8 , 2 0 1 8 m u l t i c h a n n e l . c o m
SPECIAL REPORTVIEWER WATCH 2018
MULTICHANNEL NEWS began publishing its annual Viewer Watch Special Report in 2006 with an eye toward seeing how the changing use of video was transforming the TV business. It is extraordinary what has happened in the ensuing years to digital media, which was long referred to by executives as “emerging” and “new media.”
Early on, they debated some issues that now seem quaint. Should cable networks put their content online? Was it wise to sell their content to Netflix? Why would anyone watch video of dubious quality streamed over the internet when they could view it on a beautiful, large TV in this emerging video standard called high-definition?
Often the discussion veered into apocalyptic terrain. Will Google Fiber wreck the pay TV sector? How fast will cord-cutting destroy the cable industry? Or, alternatively, just how quickly will young people return to the pay TV fold as they get older and presumably wiser?
Over time, discussions of the power — or poverty — of new media have thankfully disappeared. In transcribed interviews with 22 TV executives and researchers for this 2018 report, the phrase “new media” appears not at all — and for good reason. Heading into the New Year, Magna Global was predicting that the digital media ad spend would exceed TV advertising revenues by more than $30 billion in 2018 and that it would hit $105 billion in 2019, slightly more than the $101 billion PwC is predicting consumers will spend on pay TV subscriptions.
And those trends make many of the central business and economic issues that have long been the obses-sion of this report more relevant than ever. If new media has passed into a mature media, the old questions
of how to make money from video content or craft consumer-pleasing products are now central.
Given the difficulties many face in turning those old problems into newfound profits, we hope that this report will once again help readers understand the major trends that will impact their businesses in 2018 and beyond.
As usual, we are indebted to many people who helped with this report. In addition to the executives at pay TV operators, networks, OTT players and research firms who generously gave of their time, many research companies also contributed their insights and data. Among those, we’d particularly like to thank Frank N. Magid Associates, Horowitz Research, Magna Global, PwC, Nielsen and SNL Kagan for sharing their data with us. n
Contributing writer George Winslow compiled the data, con-ducted the interviews and wrote the articles for this report.
BY GEORGE WINSLOW@GeorgeWinslow
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Why TV’s Golden Age Isn’t a Gilded OneAs viewers and advertisers shift to streaming, expect the disruption to continue apace
IN YET ANOTHER SIGN that digital media has firmly come of age, digital advertising is expected to hit $95.2 billion in 2018, easily eclipsing the $64.0 billion that will be spent on TV.
And the digital advertising industry is expected to hit $124.6 billion by 2021 — just three years from now — more than doubling the TV advertising market, according to forecasts from Magna Global.
“The economy is doing well, the stock market is high and consumer confidence is good, so total ad sales are coming in high-er than expected,” Magna senior analyst of market intelligence Michael Leszega said. “But when you look closer at the various media, the outlook is not as good. More than 100% of the gain is coming from digital media, and traditional media are declining more than expected.”
Video streaming has also firmly established itself as a mass-market phenomenon. Consulting giant PwC predicts total over-the-top/streaming revenue from subscription video-on- demand and transactional viewing will hit $15.3 billion in 2018, while Magna estimates the digital video ad spend will vacuum up another $11.3 billion. That combined total of $26.6 billion exceeds the $23.1 billion PwC expects will be spent on cable network advertising.
“Streaming SVOD services, OTT video … are all part of the way consumers watch video and now a major part of the business,” Howard Horowitz, president and founder of Horowitz Research, said.
Maturity also brings new responsibilities and some thorny problems.
Fake Data?For one, data on digital media usage has its downsides, to be sure. In addition
to the hue and cry over charges that digital media platforms such as Facebook and Twitter had endangered democracy by profiting from the proliferation of “fake news” in 2017, ad agencies and advertisers also launched pointed critiques of ex-isting digital measurement and some of the entrenched business practices of both Google and Facebook.
In 2017, those complaints prompted a number of major brands to pull ads from Google’s YouTube after reports of their ads showing up alongside extremist videos; both Google and Facebook also came under fire for the accuracy of their data. Separate reports from Pivotal Research Group and the Video Advertising Bureau (VAB) claimed Facebook had greatly overstated the reach of its ads.
The VAB report noted that Facebook metrics showed its ads reach more people in every state than the actual population of those states.
Meanwhile, there were some encouraging signs that more traditional TV players were taking major steps to better compete with digital media, improving ad sales measurement and digital products for dissatisfied pay TV subscribers and revamping their technical infrastructures.
On the ad side, “TV is battling back against Google and Facebook with new studies showing the effectiveness of TV,” Jane Clarke, CEO and managing direc-tor of the Coalition for Innovative Media Measurement (CIMM), said. “They’re saying we can show some of the same data for TV that digital can.”
Multichannel video programming distributors are also working to operate
more like digital companies, with next-generation set-top boxes and video offer-ings, such as Comcast’s X1 platform.
“There is so much great content being produced inside and outside of pay TV,” Comcast Cable vice president of entertainment services Daniel Spinosa said. “So our No. 1 focus has been to bring all that content together” with the cloud-based X1 platform that allowed the operator to offer Netflix, YouTube, Pandora and other OTT content on the same platform as its pay TV lineup.
Similar thinking can be found at Atlantic Broadband. Heather McCallion, vice president of programming at the Quincy, Mass.-based operator, said its 2013 decision to launch the next generation of the TiVo platform has allowed Atlantic to launch OTT apps such as Netflix and offer greatly improved search, she said.
“As customers’ perception of a traditional video product dramatically changed, we had to rethink our view of the video product,” she said.
Flanker BrandsSome operators have also capitalized on the rise of OTT video by launching
their own virtual MVPDs, such as Dish Network-owned Sling TV and DirecTV Now from AT&T’s DirecTV.
“With Dish and Sling, we basically have a product for everyone,” Sling vice president of product marketing and management Jimshade Chaudhari said, allowing Dish to reach consumers who want a traditional pay TV experience with satellite TV and cord-cutters with Sling.
Hulu’s expansion from a library of on-demand offerings to include live chan-nels has also tapped into growing consumer demand for streaming media, vice president of product Richard Irving said. “We have seen a 98% increase in signups since we launched the live product,” he said, along with greater usage. “Since the
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Illustrating the rapid growth of streaming video usage, Roku reported that its active accounts hit 16.7 million in the third quarter of 2017, up 48% from a year ago, and that streaming hours were up 58% year-over-year to 3.8 billion.
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launch of the fall season, with the new network programing and football, we seen a 70% increase in viewership of live content.”
CBS Interactive reported that use of CBSN, its 24-hour stream-ing news service, was up 35% in the first three quarters of 2017, CBSI president and chief operating officer Marc DeBevoise said. The jump was particularly notable given the record-breaking news audiences since the 2016 presidential election.
OTT services are exposing younger viewers to established TV brands. SVOD service CBS All Access, which has more than 2 million subscribers, has an average viewer age of 43; the average age of CBSN viewers is 38.
“The two products are really younger than the typical audiences and, in that respect, it strengthens us for the future,” DeBevoise said.
More of the SameThe success of some operators and programmers in streaming video doesn’t
mean the age of digital disruption is over, though. “No one likes to hear this, but the pace of disruption is just accelerating,”
Magid Advisors president Mike Vorhaus said, citing survey data showing 6.1% of pay TV subscribers intend to cancel their video subscription in the next 12 months and not get a new one, up from 1.9% in the 2011 survey. “That’s the highest percentage we’ve seen,” he said.
Others agree that the decline in pay TV subs is accelerating, but disagree about what that might mean. “The first quarter, second quarter and the third quarter all had rates of decline that were higher than a year earlier,” SNL Kagan research director Ian Olgierson noted. “We haven’t seen those kinds of losses before. We’re plowing new ground here.”
However, SNL Kagan doesn’t include virtual MVPDs like Sling TV in its pay TV subscriber count.
“If we don’t include those virtual MVPDs, it creates a more dramatic decline and a very different narrative about the industry’s future,” Leichtman Research Group president and principal analyst Bruce Leichtman said.
Magna, for instance, predicts there will be only 74.7 million traditional pay TV homes in 2021. But add that figure to its forecast of 28.9 million virtual MVPD sub-scribers, and the total count of 103.6 million households in 2021 is actually higher than the 100.9 million total pay TV subscriber count reported in 2012.
Even so, the economics of the industry are worri-some.
“This is certainly the golden age of TV and con-tinues to be,” Horowitz said. “But the finance guys are saying, ‘We aren’t seeing that. We are pulling our hair out on how we can make money on our business models.’ ”
Big Brand WoesOne big factor is the health of the TV ad market. “The top 200 advertisers
that are 90% of network spending and 60% of all TV are struggling right now,”
Pivotal Research Group senior research analyst for advertising Brian Wieser said. “You have what I suspect is a perpetual weakness and that is something the industry needs to be thinking about.”
Other problems stem from the economics of streaming media.
Major players are report-ing rapid increases in the use of streaming video in the third quarter. In the third quarter of 2017, Roku reported that its active accounts hit 16.7 million, up 48% from a year ago. Streaming hours were up 58% year-over-year, to 3.8 billion.
Researchers such as Nielsen are also reporting big spikes in usage. “Adults are watching about the same amount of video as they had in the prior year, about six hours a day, but there is a shift in how that video is being accessed,” Nielsen executive vice president of client solutions and audience insights Sara Erichson said.
About 60% of U.S. homes have an SVOD service, Erichson noted. “For the first time, more homes have an SVOD service than a DVR, which is a real milestone,” she noted.
In contrast, Nielsen data shows a decline in the amount of time spent with traditional live and on-demand TV viewing by viewers 2 and older, from 29 hours and 18 minutes a week in second-quarter of 2016 to 27 hours and 44 minutes in Q2 2017.
The rise of streaming has been good for some OTT providers, such as Netflix, which had a market cap of around $82 billion in mid-December. But its profits remain skimpy. “Netflix has everyone in a tizzy,” Leichtman said. “It has a market cap bigger than Time Warner. But does that model actually work for another company? I think it is a very challenging model.”
These changes are also putting stress on the economics of programmers and producers.
Todd Supplee, a partner with PwC’s Entertainment & Media practice, said that on the production side, “the growth of OTT and streaming ser-
vices are generating new demand for content,” with Amazon expected to spend about $4.5 billion in 2017 and Netflix planning to spend $8 billion on content in 2018. But the proliferation of these services accelerates ongoing audience fragmentation, making it harder for networks to build brands or fund new content.
“The whole cost model of production has to change,” he said. n
The cloud-based X1 platform has allowed Comcast to more quickly upgrade its offerings and offer a greatly improved user interface, which the operator says has boosted usage of VOD and electronic sell-through.
“As customers’ perception of a traditional video product dramatically changed, we had to rethink our view.”
— Heather McCallion, VP of programming, Atlantic Broadband
THE TV INDUSTRY’S EFFORTS to adapt to new consumer habits have evolved for many years. Yet much remains to be done right now, particularly in the areas of measurement, designing consumer friendly products and building technical infrastructures for the digital age.
Progress in those areas will be particularly important in 2018, given the signs that the basic glue holding together the pay TV industry is melting, with subscrib-er losses accelerating and more programmers launching their own over-the-top services outside the multichannel ecosystem.
Underlying this transformation is new technology for operations. “We are very focused on the idea that we have to make our content available literally anytime and anyplace,” Diane Tryneski, HBO executive vice president, technology, and chief digital officer, technology, said. “That is a real change and the tech that sup-ports that has to be very different than it used to be.”
To do that, HBO has embraced cloud and internet protocol technologies and adopted workflows that allow the programmer to quickly respond to new business opportunities. “The fact that we aren’t siloed means that we are seamlessly deliv-ering content to anywhere, whether it’s TV everywhere, HBO Go or one of our affiliates’ platforms,” she said.
Discovery Communications senior vice president of technology strategy and architect Brinton Miller said he sees the same advantages and prospects. “Dis-covery has been very focused on getting our content on every screen and every platform, from [multichannel video programming distributors] to social or what-ever the next big thing that comes around will be and we have been executing on
that strategy in the last few years,” he said. “That has meant a big shift in the way we approach infrastructure, so that we can react quickly to this quickly changing landscape.”
It’s Hard to Make Things EasierAchieving those goals isn’t easy, given the scale
and complexity of major programmers’ operations.Discovery, for example, has more than 420 linear
networks and publishes to more than 380 different nonlinear platforms. Each year, the company takes in about 3,000 hours of new content that must be versioned for 220 countries around the world.
To simplify those operations, Discovery has already completed its “On Ramp” project, which allows it to get content from producers and process it in the cloud using Amazon Web Services (AWS). The company has also moved all of its U.S. linear networks to native cloud infrastructure with AWS.
Notable progress can also be found at pay TV operators. During a lengthy interview, Phil McKinney, president and CEO of CableLabs, ticked off a long list of initiatives helping the cable industry transform their infrastructures.
These range from the transition to IP and cloud-based technologies, which are allowing op-erators such as Comcast to launch next-generation interfaces on the X1 platform, to the close alliances CableLabs is setting up with consumer electronics companies and Silicon Valley firms that are bring-ing new technologies into the industry.
One particularly important area is increased bandwidth to enable a host of new services. “Im-proved broadband is a critical foundation for the fu-ture of our business,” said Heather McCallion, vice
president of programming at Atlantic Broadband, which has rolled out 1 Gigabit- per-second service in two markets and is working on DOCSIS 3.1 upgrades.
DOSCIS 3.1 infrastructures will let operators handle broadband speeds of 10 Gbps downstream and 1 Gbps upstream, with even more bandwidth in the pipe-line. CableLabs, for example, has developed technologies that use coherent optics to dramatically speed up existing hybrid fiber coaxial networks with no need to lay down new fiber or dig up old infrastructure.
Counting on Measured ProgressAnother major issue is measurement. “The industry has to get to the point
where it has reliable syndicated cross-platform measurement, but at the moment we still don’t have it,” Turner chief resource officer Howard Shimmel noted.
Cary Meyers, senior vice president of fan and media intelligence at ESPN, highlighted the importance of better measurement by citing recently released data from the first seven weeks of the Nielsen Total Live Audience service.
Between Sept. 25 and Nov. 12, the addition of out-of-home and streaming viewing to traditional viewing numbers meant that ESPN’s ratings were up among millennials aged 18-34 by 28% in primetime over ESPN’s traditional viewing. “We can now see that the millennials that have been missing from [traditional] ratings are in fact viewing our programming in large numbers,” Meyers said.
Overall, the new data from millennials — who account for 46% of the stream-ing of ESPN programming — boosted ratings for college football by 16% and for
Putting Consumers First With DigitalUnder mounting pressure to revamp their offerings, programmers and distributors take measures to improve the viewing experience
m u l t i c h a n n e l . c o m J A N U A R Y 8 , 2 0 1 8 M U L T I C H A N N E L N E W S 1 1
Virtual MVPD Sling TV has worked to be on as many platforms as possible, including the Chromecast app.
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Monday Night Football by 13%. A number of other major
programmers have also made great strides in cobbling togeth-er a more complete picture of total viewing across platforms.
For example, Shimmel noted, Turner has ramped up its big data capabilities and analytics by combining its own digital consumption data with more traditional measuremements to document cross-platform view-ing. Turner recently signed up for Nielsen’s new SVOD ratings and has also been working with 21st Century Fox and Via-com to form Open AP to help standardize the definition. But Shimmel said he was still frustrated by the lack of industry progress toward objective third-party syndicated ratings. “We have to make it easier for advertisers,” he said.
One issue has centered on Nielsen’s SDKs, which are required for the new measurement systems to work. “These SDKs are difficult to implement and you are missing a bunch of networks that haven’t turned them on,” said Jane Clarke, CEO and managing director, Coalition for Innovative Media Measurement (CIMM).
Sara Erichson, executive vice president of client solutions and audience insights at Nielsen, disagreed, noting that “SDK implementation has improved substantial-ly over the past year. … There is a lot of implementation and trialing of products going on behind the scenes.”
Other promising developments include work on new standards. In the fall of 2017, the Media Rating Council issued standards for digital measurement and in 2018 they will be tackling the larger issue of creating a standard for cross-platform measurement, noted George Ivie, executive director and CEO at the MRC.
“There are a lot of big issues to be solved, but we are doing a ton of heavy lift-ing and I think there is hope,” Ivie said. “We are making progress.”
Confusion Still ReignsImproving the consumer experience is another major area of focus for many
companies. Todd Supplee, a partner with PwC’s Entertainment & Media practice, noted that rapid proliferation of choice and high quality TV pro-gramming is making it harder for consumers to find the content they want.
“There is a lot of confusion among consum-ers,” he said. The recent PwC Content Discovery survey, for example, found that 62% of respon-dents complained of struggling to find something to watch and that consumer frustration with the way they access programming is actually higher among streaming-only consumers, with pay TV subscribers reporting less annoyance.
Many companies hope to attract subs by solving these problems. “We see a real opportunity in the idea of bringing all this [OTT and pay TV] content together and making it easier for consum-ers,” Daniel Spinosa, vice president of entertain-ment services at Comcast Cable, said.
Spinosa argues that the improved inter-face of their X1 platform has helped boost VOD consumption by 30% year-over-year and that it has allowed them to build a suc-cessful electronic sell-through business.
Atlantic Broadband’s next-generation TiVo platform has also paid off in subscrib-er retention, Heather McCallion, the oper-ator’s vice president of programming, said. After purchasing a system in Connecticut that had been losing video customers for years, the new TiVo platform and bundling strategy quickly turned things around. “For the first time in that market in many years we actually grew subscribers,” she said.
“Usability is a major driver in everyone’s future success,” added Howard Horowitz, president and founder, Horowitz Research, who also stressed the importance of building
programming packages that appeal to consumers at different stages of their life. Comcast’s Spinosa agreed. As part of an effort to attract younger consumers,
the MSO launched Xfinity on Campus and then Internet Plus, which is now turning into Instant TV. “It gives them an entry point to the ecosystem that gives them the content they love,” he said. “But it also allows them to buy up into other elements, getting premium networks, Netflix and ultimately buying into bigger and bigger platforms as they migrate from young millennial to having a family.”
Interfacing With ConsumersFinding the sweet spot with improved interfaces and better program offer-
ings is also key to the increasingly competitive virtual MVPD space. “There are a lot of these other services that are just creating and replicating the model you saw in traditional pay TV on a different delivery mechanism,” Jimshade Chaudhari, vice president of product marketing and management at Sling TV, said. “We are offering a la carte packages that are as granular as you can get in our industry so they can pick and choose the channels and genres that are most important to them.”
Sling has also worked to improve navigation, with a universal search engine that includes both the live content from the over-the-air broadcast networks and on-demand content.
Richard Irving, vice president of product at Hulu, also stressed the importance of the user experience. “Our goal is to create a decidedly unique experience and a deeply personal one,” he said, with a better interface, better search and personalization\ and voice recognition.
FuboTV has worked to differentiate its offerings by focusing on sports and Spanish-lan-guage content, head of content acquisition and strategy Ben Grad noted, though it does offer a wide array of other programming.
Last September, the young service hit 100,000 subscribers, with more to come, and Grad said he likes where things are headed.
“One of the biggest things impacting the consumption of video is just the fragmentation and diffusion of viewership,” he said, making the pay TV bundle less valuable — and boosting the popularity of services such as FuboTV. n
Hulu and other SVOD services are bringing in voice commands to help users quickly search and find content.
“The industry has to get to the point where it has reliable syndicated cross- platform measurement, but at the moment we still don’t have it.”
— Howard Shimmel, chief research officer, Turner
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SOURCE: Magna. Actual homes from SNL Kagan for 2012-2016; projections for 2017 to 2021 by Magna. Virtual MVPDs include Sling TV, DirecTV Now, Playstation Vue, Hulu with Live TV and YouTube TV.
The Multichannel TV LandscapeEstimates of traditional pay TV subscribers continue to fall, with Magna Global now predicting there will be about 74.7 million traditional pay TV homes in 2021, a drop of 23 million since 2016. Magna also predicts rapid growth in virtual MVPDs, though — they should hit 28.9 million subs by 2021.
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
100.9 100.7 100.5 99.4 97.794.0
89.784.9
79.974.7
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
57.1 55.2 53.8 53.2 52.9 51.7 50.1 48.4 46.6 44.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
34 33.7 33.6 33.1 33.4 31.9 30.2 28.3 26.3 24.3
10.011.8
13.0 13.011.4
10.59.4
8.27.0
5.8
0 0 0 0.6 1.64.3
9.0
15.3
22.2
28.9
Total Multichannel Households (Millions of U.S. homes)
Total Cable Subs (Millions of U.S. homes)
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
100.9 100.7 100.5 99.4 97.794.0
89.784.9
79.974.7
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
57.1 55.2 53.8 53.2 52.9 51.7 50.1 48.4 46.6 44.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
34 33.7 33.6 33.1 33.4 31.9 30.2 28.3 26.3 24.3
10.011.8
13.0 13.011.4
10.59.4
8.27.0
5.8
0 0 0 0.6 1.64.3
9.0
15.3
22.2
28.9
Total Satellite Subs (Millions of U.S. homes)
Total Telco Video Subs (Millions of U.S. homes)
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
100.9 100.7 100.5 99.4 97.794.0
89.784.9
79.974.7
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
57.1 55.2 53.8 53.2 52.9 51.7 50.1 48.4 46.6 44.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
34 33.7 33.6 33.1 33.4 31.9 30.2 28.3 26.3 24.3
10.011.8
13.0 13.011.4
10.59.4
8.27.0
5.8
0 0 0 0.6 1.64.3
9.0
15.3
22.2
28.9
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
100.9 100.7 100.5 99.4 97.794.0
89.784.9
79.974.7
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
57.1 55.2 53.8 53.2 52.9 51.7 50.1 48.4 46.6 44.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
34 33.7 33.6 33.1 33.4 31.9 30.2 28.3 26.3 24.3
10.011.8
13.0 13.011.4
10.59.4
8.27.0
5.8
0 0 0 0.6 1.64.3
9.0
15.3
22.2
28.9Virtual MVPDs (Millions of U.S. homes)
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
100.9 100.7 100.5 99.4 97.794.0
89.784.9
79.974.7
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
57.1 55.2 53.8 53.2 52.9 51.7 50.1 48.4 46.6 44.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
34 33.7 33.6 33.1 33.4 31.9 30.2 28.3 26.3 24.3
10.011.8
13.0 13.011.4
10.59.4
8.27.0
5.8
0 0 0 0.6 1.64.3
9.0
15.3
22.2
28.9
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SOURCE: PwC, Global entertainment and media outlook: 2017–2021. Preliminary data for 2016; projections for 2017 to 2021.
The Multichannel BusinessGiven ongoing subscriber losses, PwC has revised downward its estimates for U.S. subscription fee revenue growth: It now predicts growth will remain relatively flat at $100.8 billion in 2018 and sees only a modest increase to $101.1 billion by 2021. But total broadband access spending will continue to see healthy growth, rising to $59.9 billion in 2021.
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Spotlight on Advertising Digital advertising first surpassed the TV ad spend in 2016, and Magna predicts that it will hit levels at more than double the TV ad spend by 2021, when digital will hit $124.6 billion versus $57.4 billion for TV.
SOURCE: Magna. Actual data from 2011-2016; projections for 2017 to 2021.
Total Digital Video Advertising $ billions
Total Social Media Advertising $ billions
64.0 63.666.1
63.967.1
61.9 64.059.0
62.257.4
36.642.8
49.659.9
72.4
84.7
105.0114.6
124.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.4 3.0 4.1 5.57.0
9.011.3
14.417.6
20.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
7.1 13.122.3
36.250.2
63.676.1
88.4100.7
95.2
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.3 3.97.0
11.016.4
22.427.5
31.535.3
39.5
3.4
64.0 63.666.1
63.967.1
61.9 64.059.0
62.257.4
36.642.8
49.659.9
72.4
84.7
105.0114.6
124.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.4 3.0 4.1 5.57.0
9.011.3
14.417.6
20.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
7.1 13.122.3
36.250.2
63.676.1
88.4100.7
95.2
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.3 3.97.0
11.016.4
22.427.5
31.535.3
39.5
3.4
Total Mobile Advertising $ billions
64.0 63.666.1
63.967.1
61.9 64.059.0
62.257.4
36.642.8
49.659.9
72.4
84.7
105.0114.6
124.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.4 3.0 4.1 5.57.0
9.011.3
14.417.6
20.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
7.1 13.122.3
36.250.2
63.676.1
88.4100.7
95.2
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.3 3.97.0
11.016.4
22.427.5
31.535.3
39.5
3.4
64.0 63.666.1
63.967.1
61.9 64.059.0
62.257.4
36.642.8
49.659.9
72.4
84.7
105.0114.6
124.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.4 3.0 4.1 5.57.0
9.011.3
14.417.6
20.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
7.1 13.122.3
36.250.2
63.676.1
88.4100.7
95.2
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.3 3.97.0
11.016.4
22.427.5
31.535.3
39.5
3.4
Total TV Advertising $ billions
Total Digital Advertising $ billions
64.0 63.666.1
63.967.1
61.9 64.059.0
62.257.4
36.642.8
49.659.9
72.4
84.7
105.0114.6
124.6
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.4 3.0 4.1 5.57.0
9.011.3
14.417.6
20.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
7.1 13.122.3
36.250.2
63.676.1
88.4100.7
95.2
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.3 3.97.0
11.016.4
22.427.5
31.535.3
39.5
3.4
1 6 M U L T I C H A N N E L N E W S J A N U A R Y 8 , 2 0 1 8 m u l t i c h a n n e l . c o m
VIEWER WATCH 2018SPECIAL REPORT
The Content GamePwC predicts strong growth for the electronic home video sector, with electronic video rentals growing from $11.4 billion in 2017 to $15.7 billion in 2021. Revenue from sports media rights will increase to $22.7 billion in North America by 2021.
SOURCE: Revenue for home video from PwC, Global entertainment and media outlook: 2017–2021. Preliminary data for 2016; projections for 2017 to 2021. Sports data from PwC, At the Gate and Beyond: Outlook for the Sports Market in North America through 2021, December, 2017.
m u l t i c h a n n e l . c o m J A N U A R Y 8 , 2 0 1 8 M U L T I C H A N N E L N E W S 1 7
OTT and Gaming: A Closer Look Revenue from subscription and transactional video services will jump from $13.6 billion in 2017 to $18.8 billion in 2021 while video game revenue will grow to $28.2 billion by 2021, according to PwC.
Transactional Internet VOD Revenue $ billions
Virtual Reality Revenue $ billions
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
4.4
6.7
8.2
9.8
11.9
13.6
15.316.4
17.718.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.8
4.65.5
6.7
8.2
9.6
10.911.9
13.114.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1.62.1
2.63.1
3.74.1 4.4 4.5 4.7 4.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
00.4
1.7
3.23.7
4.45.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
14.2 15.2 16.618.8
21.023.3
25.1 26.5 27.6 28.5
0 0 0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
4.4
6.7
8.2
9.8
11.9
13.6
15.316.4
17.718.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.8
4.65.5
6.7
8.2
9.6
10.911.9
13.114.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1.62.1
2.63.1
3.74.1 4.4 4.5 4.7 4.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
00.4
1.7
3.23.7
4.45.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
14.2 15.2 16.618.8
21.023.3
25.1 26.5 27.6 28.5
0 0 0
Video Game Revenue $ billions
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
4.4
6.7
8.2
9.8
11.9
13.6
15.316.4
17.718.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.8
4.65.5
6.7
8.2
9.6
10.911.9
13.114.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1.62.1
2.63.1
3.74.1 4.4 4.5 4.7 4.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
00.4
1.7
3.23.7
4.45.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
14.2 15.2 16.618.8
21.023.3
25.1 26.5 27.6 28.5
0 0 0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
4.4
6.7
8.2
9.8
11.9
13.6
15.316.4
17.718.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.8
4.65.5
6.7
8.2
9.6
10.911.9
13.114.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1.62.1
2.63.1
3.74.1 4.4 4.5 4.7 4.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
00.4
1.7
3.23.7
4.45.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
14.2 15.2 16.618.8
21.023.3
25.1 26.5 27.6 28.5
0 0 0
Total Internet Video $ billions
SVOD Revenue $ billions
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
4.4
6.7
8.2
9.8
11.9
13.6
15.316.4
17.718.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2.8
4.65.5
6.7
8.2
9.6
10.911.9
13.114.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
1.62.1
2.63.1
3.74.1 4.4 4.5 4.7 4.8
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
00.4
1.7
3.23.7
4.45.0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
14.2 15.2 16.618.8
21.023.3
25.1 26.5 27.6 28.5
0 0 0
SOURCE: PwC, Global entertainment and media outlook: 2017–2021. Preliminary data for 2016; projections for 2017 to 2021. The total internet video figures from above include SVOD and transactional, but do not include internet video advertising.
1 8 M U L T I C H A N N E L N E W S J A N U A R Y 8 , 2 0 1 8 m u l t i c h a n n e l . c o m
The Emerging Platform View About 42% of users still select TV as their primary digital platform, versus 11% for mobile phones and 25% for computers, according to recent survey data from Frank N. Magid Associates, which also reports increased interest in live streaming video and virtual reality technologies.
VIEWER WATCH 2018SPECIAL REPORT
Top Platforms for Entertainment (Respondents asked to name only one platform)
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
TELEVISION
SMARTPHONE
VIDEO GAME CONSOLE
TABLET
SOURCE: Magid Media Futures 2017. Based on a nationally representative online survey of 2,400 consumers age 18-64; data was collected from May 24 to June 11, 2017.
Most Popular Sources for Online Video (Online users age 18-64)
LAPTOP OR PC
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
Most Popular SVOD Services (% of online users age 18-64 who have the service)
Popularity of Live Streaming Video Platforms (% of monthly live streaming video viewers age 18-64)
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
2011 44%
2017 42%
32%
25%
4%
11%
6%
8%
2%
8%
2011
2017
2011
2017
2011
2017
2011
2017
YouTubeFacebook
NetflixInstagram
Hulu
TwitterSnapchat
Vevo
Twitch
VimeoDailyMotion
70%42%42%
22%20%
15%14%
6%6%6%6%
51%29%
20%12%
8%5%
NetflixAmazon Prime Video
HuluHBO Now
YouTube RedCBS All Access
Facebook LiveYouTube
InstagramTwitter
SnapchatTwitch
LivestreamPeriscope
YouNowUStream
45%44%
28%19%
17%12%
10%9%
6%4%
m u l t i c h a n n e l . c o m J A N U A R Y 8 , 2 0 1 8 M U L T I C H A N N E L N E W S 1 9
The Multichannel, Multidevice WorldWhile 82% of 18-to-34-year-olds still have a multichannel subscription, 91% of these young adults have an SVOD service, and even more than half of Americans age 50 and older are SVOD subscribers, according to Horowitz Research.
SOURCE: Horowitz Research, State of Pay TV, OTT and SVOD, 2017
Electronic Devices and Services (Among viewers of TV content)
82%Total 18+
18-34
35-49
50+
Children in HH
82%
85%
80%
86%
72%
18-34
35-49
50+
91%
80%
51%
88%Children in HH
50%
18-34
35-49
50+
Children in HH
50%
53%
47%
58%
88%
18-34
35-49
50+
Children in HH
95%
95%
79%
94%
80%
18-34
35-49
50+
Children in HH
94%
90%
62%
95%
54%
18-34
35-49
50+
80%
66%
80%Children in HH
91%
18-34
35-49
50+
Children in HH
99%
96%
80%
99%
86%
18-34
35-49
50+
Children in HH
97%
92%
73%
95%
63%
18-34
35-49
50+
Children in HH
71%
74%
48%
83%
35%
18-34 44%
35-49 43%
50+ 22%
Children in HH 49%
50%
18-34 66%
35-49 56%
50+ 34%
Children in HH 64%
42%
18-34 44%
51%
33%
35-49
50+
Children in HH 59%
37%Children in HH 51%
42%
18-34 51%18-34 46%
35-49 50%35-49 43%
50+ 30%
18-34 53%
35-49 47%
50+ 23%50+ 25%
Children in HH 55%
39%Children in HH 50%
26%
Multichannel subscriptions
Total 18+
SVOD penetration DVR High-speed internet access at home
Total 18+ Total 18+
Total 18+ Total 18+ Total 18+ Total 18+
Able to stream video to TV from any device
Able to stream video to TV with game console
Handheld with video capability Smartphone with video capability
Any video capable tablet/e-reader iPadVideo capable tablet/e-reader other than an iPad
Uses a cable to connect computer, laptop, tablet or cellphone to TV set
Total 18+ Total 18+ Total 18+ Total 18+
Total 18+ Total 18+ Total 18+
Stream from Blu-ray/DVD player Stream from smart TV Stream from stick or box to TV
82%Total 18+
18-34
35-49
50+
Children in HH
82%
85%
80%
86%
72%
18-34
35-49
50+
91%
80%
51%
88%Children in HH
50%
18-34
35-49
50+
Children in HH
50%
53%
47%
58%
88%
18-34
35-49
50+
Children in HH
95%
95%
79%
94%
80%
18-34
35-49
50+
Children in HH
94%
90%
62%
95%
54%
18-34
35-49
50+
80%
66%
80%Children in HH
91%
18-34
35-49
50+
Children in HH
99%
96%
80%
99%
86%
18-34
35-49
50+
Children in HH
97%
92%
73%
95%
63%
18-34
35-49
50+
Children in HH
71%
74%
48%
83%
35%
18-34 44%
35-49 43%
50+ 22%
Children in HH 49%
50%
18-34 66%
35-49 56%
50+ 34%
Children in HH 64%
42%
18-34 44%
51%
33%
35-49
50+
Children in HH 59%
37%Children in HH 51%
42%
18-34 51%18-34 46%
35-49 50%35-49 43%
50+ 30%
18-34 53%
35-49 47%
50+ 23%50+ 25%
Children in HH 55%
39%Children in HH 50%
26%
Multichannel subscriptions
Total 18+
SVOD penetration DVR High-speed internet access at home
Total 18+ Total 18+
Total 18+ Total 18+ Total 18+ Total 18+
Able to stream video to TV from any device
Able to stream video to TV with game console
Handheld with video capability Smartphone with video capability
Any video capable tablet/e-reader iPadVideo capable tablet/e-reader other than an iPad
Uses a cable to connect computer, laptop, tablet or cellphone to TV set
Total 18+ Total 18+ Total 18+ Total 18+
Total 18+ Total 18+ Total 18+
Stream from Blu-ray/DVD player Stream from smart TV Stream from stick or box to TV
82%Total 18+
18-34
35-49
50+
Children in HH
82%
85%
80%
86%
72%
18-34
35-49
50+
91%
80%
51%
88%Children in HH
50%
18-34
35-49
50+
Children in HH
50%
53%
47%
58%
88%
18-34
35-49
50+
Children in HH
95%
95%
79%
94%
80%
18-34
35-49
50+
Children in HH
94%
90%
62%
95%
54%
18-34
35-49
50+
80%
66%
80%Children in HH
91%
18-34
35-49
50+
Children in HH
99%
96%
80%
99%
86%
18-34
35-49
50+
Children in HH
97%
92%
73%
95%
63%
18-34
35-49
50+
Children in HH
71%
74%
48%
83%
35%
18-34 44%
35-49 43%
50+ 22%
Children in HH 49%
50%
18-34 66%
35-49 56%
50+ 34%
Children in HH 64%
42%
18-34 44%
51%
33%
35-49
50+
Children in HH 59%
37%Children in HH 51%
42%
18-34 51%18-34 46%
35-49 50%35-49 43%
50+ 30%
18-34 53%
35-49 47%
50+ 23%50+ 25%
Children in HH 55%
39%Children in HH 50%
26%
Multichannel subscriptions
Total 18+
SVOD penetration DVR High-speed internet access at home
Total 18+ Total 18+
Total 18+ Total 18+ Total 18+ Total 18+
Able to stream video to TV from any device
Able to stream video to TV with game console
Handheld with video capability Smartphone with video capability
Any video capable tablet/e-reader iPadVideo capable tablet/e-reader other than an iPad
Uses a cable to connect computer, laptop, tablet or cellphone to TV set
Total 18+ Total 18+ Total 18+ Total 18+
Total 18+ Total 18+ Total 18+
Stream from Blu-ray/DVD player Stream from smart TV Stream from stick or box to TV
82%Total 18+
18-34
35-49
50+
Children in HH
82%
85%
80%
86%
72%
18-34
35-49
50+
91%
80%
51%
88%Children in HH
50%
18-34
35-49
50+
Children in HH
50%
53%
47%
58%
88%
18-34
35-49
50+
Children in HH
95%
95%
79%
94%
80%
18-34
35-49
50+
Children in HH
94%
90%
62%
95%
54%
18-34
35-49
50+
80%
66%
80%Children in HH
91%
18-34
35-49
50+
Children in HH
99%
96%
80%
99%
86%
18-34
35-49
50+
Children in HH
97%
92%
73%
95%
63%
18-34
35-49
50+
Children in HH
71%
74%
48%
83%
35%
18-34 44%
35-49 43%
50+ 22%
Children in HH 49%
50%
18-34 66%
35-49 56%
50+ 34%
Children in HH 64%
42%
18-34 44%
51%
33%
35-49
50+
Children in HH 59%
37%Children in HH 51%
42%
18-34 51%18-34 46%
35-49 50%35-49 43%
50+ 30%
18-34 53%
35-49 47%
50+ 23%50+ 25%
Children in HH 55%
39%Children in HH 50%
26%
Multichannel subscriptions
Total 18+
SVOD penetration DVR High-speed internet access at home
Total 18+ Total 18+
Total 18+ Total 18+ Total 18+ Total 18+
Able to stream video to TV from any device
Able to stream video to TV with game console
Handheld with video capability Smartphone with video capability
Any video capable tablet/e-reader iPadVideo capable tablet/e-reader other than an iPad
Uses a cable to connect computer, laptop, tablet or cellphone to TV set
Total 18+ Total 18+ Total 18+ Total 18+
Total 18+ Total 18+ Total 18+
Stream from Blu-ray/DVD player Stream from smart TV Stream from stick or box to TV
2 0 M U L T I C H A N N E L N E W S J A N U A R Y 8 , 2 0 1 8 m u l t i c h a n n e l . c o m
The Multicultural, Multimedia UniverseHispanics have embraced digital video in a big way, with 79% having an SVOD service, versus 72% of the general market and 87% of Hispanics reporting that they can stream video to the TV, according to Horowitz Research.
VIEWER WATCH 2018SPECIAL REPORT
SOURCE: Horowitz Research, State of Pay TV, OTT and SVOD, 2017
Ethnic Groups and Video Technologies(% of urban viewers of TV content who have the device or service)
High-speed Internet Handheld with video capabilityAble to stream video to TV from any device
Able to stream video to TV with game console
Stream from Blu-ray/DVD Player
Multichannel subscription SVOD subscription
Stream from smart TV Stream from stick or box to TV
DVR
Tablet iPad
37
37
34
45
63
64
69
65
35
3051
40
54
58
47
63 5350
4239
3936
46
45
86
908888
9093
8991
87
828380
TotalAfrican-American
AsianHispanic
87818682 72
7371
79 4936
5050
High-speed Internet Handheld with video capabilityAble to stream video to TV from any device
Able to stream video to TV with game console
Stream from Blu-ray/DVD Player
Multichannel subscription SVOD subscription
Stream from smart TV Stream from stick or box to TV
DVR
Tablet iPad
37
37
34
45
63
64
69
65
35
3051
40
54
58
47
63 5350
4239
3936
46
45
86
908888
9093
8991
87
828380
TotalAfrican-American
AsianHispanic
87818682 72
7371
79 4936
5050
High-speed Internet Handheld with video capabilityAble to stream video to TV from any device
Able to stream video to TV with game console
Stream from Blu-ray/DVD Player
Multichannel subscription SVOD subscription
Stream from smart TV Stream from stick or box to TV
DVR
Tablet iPad
37
37
34
45
63
64
69
65
35
3051
40
54
58
47
63 5350
4239
3936
46
45
86
908888
9093
8991
87
828380
TotalAfrican-American
AsianHispanic
87818682 72
7371
79 4936
5050
High-speed Internet Handheld with video capabilityAble to stream video to TV from any device
Able to stream video to TV with game console
Stream from Blu-ray/DVD Player
Multichannel subscription SVOD subscription
Stream from smart TV Stream from stick or box to TV
DVR
Tablet iPad
37
37
34
45
63
64
69
65
35
3051
40
54
58
47
63 5350
4239
3936
46
45
86
908888
9093
8991
87
828380
TotalAfrican-American
AsianHispanic
87818682 72
7371
79 4936
5050
High-speed Internet Handheld with video capabilityAble to stream video to TV from any device
Able to stream video to TV with game console
Stream from Blu-ray/DVD Player
Multichannel subscription SVOD subscription
Stream from smart TV Stream from stick or box to TV
DVR
Tablet iPad
37
37
34
45
63
64
69
65
35
3051
40
54
58
47
63 5350
4239
3936
46
45
86
908888
9093
8991
87
828380
TotalAfrican-American
AsianHispanic
878186
82 727371
79 4936
5050
KEY:
m u l t i c h a n n e l . c o m J A N U A R Y 8 , 2 0 1 8 M U L T I C H A N N E L N E W S 2 1
Cord-Cutting Close-Up A recent survey from Magid notes that the intention to cut the cord has reached record levels, at 6.1%, while Magna expects the number of cord-cutters to hit 27.1 million by 2021.
SOURCE: Magid Media Futures 2017. Based on a nationally representative online survey of 2,400 consumers ages 8-64; data was collected from May 24 to June 11, 2017.
Planning to Cut the Cord(% of pay TV subs ages 18-64 who say they are very likely to cancel their subscription in the next 12 months and not get another one)
Cord-Cutters(Millions of households)
Cord-Nevers(Millions of households)
Reasons for Cutting the Cord(% among very likely cord-cutters)
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 20172011
6.15.7
3.8
2.92.7
2.21.9
27.422.2
17.112.4
8.04.42.71.7N/A N/A
27.626.325.123.822.621.320.119.019.518.3
“I don’t watch enough TV to make it worth it”
2014
2017
42%
29%
2014
2017
2014
2017
48%
44%
27%
27%
2014
2017
2014
2017
40%
27%
34%25%
“I am satisfied with what I can receive over the air”
"I can watch the TV shows and movies I like on the Internet”*
“I am satisfied with online streaming options on my TV from services like Netflix, Hulu”*
“It's too expensive”
“I can watch the TV shows and movies I like on DVD”
2014
2017
26%18%
“I have entertainment options on the Internet”*
2014
2017
Combined OTT reasons
2014
2017
46%
17%
61%
76%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 20172011
6.15.7
3.8
2.92.7
2.21.9
27.422.2
17.112.4
8.04.42.71.7N/A N/A
27.626.325.123.822.621.320.119.019.518.3
“I don’t watch enough TV to make it worth it”
2014
2017
42%
29%
2014
2017
2014
2017
48%
44%
27%
27%
2014
2017
2014
2017
40%
27%
34%25%
“I am satisfied with what I can receive over the air”
"I can watch the TV shows and movies I like on the Internet”*
“I am satisfied with online streaming options on my TV from services like Netflix, Hulu”*
“It's too expensive”
“I can watch the TV shows and movies I like on DVD”
2014
2017
26%18%
“I have entertainment options on the Internet”*
2014
2017
Combined OTT reasons
2014
2017
46%
17%
61%
76%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 20172011
6.15.7
3.8
2.92.7
2.21.9
27.422.2
17.112.4
8.04.42.71.7N/A N/A
27.626.325.123.822.621.320.119.019.518.3
“I don’t watch enough TV to make it worth it”
2014
2017
42%
29%
2014
2017
2014
2017
48%
44%
27%
27%
2014
2017
2014
2017
40%
27%
34%25%
“I am satisfied with what I can receive over the air”
"I can watch the TV shows and movies I like on the Internet”*
“I am satisfied with online streaming options on my TV from services like Netflix, Hulu”*
“It's too expensive”
“I can watch the TV shows and movies I like on DVD”
2014
2017
26%18%
“I have entertainment options on the Internet”*
2014
2017
Combined OTT reasons
2014
2017
46%
17%
61%
76%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012 2013 2014 2015 2016 20172011
6.15.7
3.8
2.92.7
2.21.9
27.422.2
17.112.4
8.04.42.71.7N/A N/A
27.626.325.123.822.621.320.119.019.518.3
“I don’t watch enough TV to make it worth it”
2014
2017
42%
29%
2014
2017
2014
2017
48%
44%
27%
27%
2014
2017
2014
2017
40%
27%
34%25%
“I am satisfied with what I can receive over the air”
"I can watch the TV shows and movies I like on the Internet”*
“I am satisfied with online streaming options on my TV from services like Netflix, Hulu”*
“It's too expensive”
“I can watch the TV shows and movies I like on DVD”
2014
2017
26%18%
“I have entertainment options on the Internet”*
2014
2017
Combined OTT reasons
2014
2017
46%
17%
61%
76%
* Options included in the combined OTT reasons
0
SOURCE: Magna. Actual numbers for 2011-2016; projections for 2017-2021.
