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Nielsen announced that it will begin to measure out-of-home TV consumption, in an effort to give its national television clients a more holistic understanding of their content distribution.
The service will provide both program and commercial TV ratings for up to seven days of time-shifted viewing in out-of-home locations such as bars, airports, restaurants, and waiting areas. The company expects to launch its out-of-home service in April 2017, with data from January 2017 on.
Here is a breakdown of what Nielsen’s National TV Out-of-Home Measurement Service will cover and how it will work:
- Nielsen will leverage its Portable People Meter (PPM) — a device that uses wireless cellular technology to determine what programming is being consumed — across 75,000 panelists in 44 local markets, which will enable the company to estimate out-of-home TV consumption in over half the US population.
- Shortly after its launch in April, clients will be able to view out-of-home data as far back as September 2016. This should benefit networks that broadcast football games like NBC, CBS, and ESPN, as September is the start of the NFL season.
- Initially, the service will keep out-of-home ratings and in-home ratings separate, but there are plans to merge the two at a later stage.
Sports networks, in particular, have complained about the need for more efficient TV measurement, as a good chunk of this consumption happens in bars and restaurants. The announcement comes at a welcome time for these networks, such as ESPN, that are struggling with declining ratings and diminishing subscriber counts.
- Declining football ratings. ESPN, CBS, and NBC all saw double-digit viewership declines through the first four games of the NFL season, at 17%, 15%, and 13%, respectively. While the NFL season will be long over by the time out-of-home ratings are incorporated in April, the service can shine light on whether these declines represent a short-term problem or if viewing outside the home makes a noticeable difference.
- Falling subscriber numbers. While presidential election coverage could be contributing to falling ratings, cord-cutting and cord-shaving are having a greater impact on subscriptions among sports networks, most notably ESPN. In fact, as of August 2016, ESPN had lost 7.39 million households in just over two years. Measuring out-of-home ratings could potentially capture consumers opting to shave their cable bill and watch big games at the local bar.
Over the last few years, there’s been much talk about the “death of TV.” However, television is not dying so much as it's evolving: extending beyond the traditional television screen and broadening to include programming from new sources accessed in new ways.
It's strikingly evident that more consumers are shifting their media time away from live TV, while opting for services that allow them to watch what they want, when they want. Indeed, we are seeing a migration toward original digital video such as YouTube Originals, SVOD services such as Netflix, and live streaming on social platforms.
However, not all is lost for legacy media companies. Amid this rapidly shifting TV landscape, traditional media companies are making moves across a number of different fronts — trying out new distribution channels, creating new types of programming aimed at a mobile-first audience, and partnering with innovate digital media companies. In addition, cable providers have begun offering alternatives for consumers who may no longer be willing to pay for a full TV package.
Dylan Mortensen, senior research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on the future of TV that looks at how TV viewer, subscriber, and advertising trends are shifting, and where and what audiences are watching as they turn away from traditional TV.
Here are some key points from the report:
- Increased competition from digital services like Netflix and Hulu as well as new hardware to access content are shifting consumers' attention away from live TV programming.
- Across the board, the numbers for live TV are bad. US adults are watching traditional TV on average 18 minutes fewer per day versus two years ago, a drop of 6%. In keeping with this, cable subscriptions are down, and TV ad revenue is stagnant.
- People are consuming more media content than ever before, but how they're doing so is changing. Half of US TV households now subscribe to SVOD services, like Netflix, Amazon, and Hulu, and viewing of original digital video content is on the rise.
- Legacy TV companies are recognizing these shifts and beginning to pivot their business models to keep pace with the changes. They are launching branded apps and sites to move their programming beyond the TV glass, distributing on social platforms to reach massive, young audiences, and forming partnerships with digital media brands to create new content.
- The TV ad industry is also taking a cue from digital. Programmatic TV ad buying represented just 4% (or $2.5 billion) of US TV ad budgets in 2015 but is expected to grow to 17% ($10 billion) by 2019. Meanwhile, networks are also developing branded TV content, similar to publishers' push into sponsored content.
In full, the report:
- Outlines the shift in consumer viewing habits, specifically the younger generation.
- Explores the rise of subscription streaming services and the importance of original digital video content.
- Breaks down ways in which legacy media companies are shifting their content and advertising strategies.
- And Discusses new technology that will more effectively measure audiences across screens and platforms.
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