Hub Research: Online TV Services Have Passed Traditional Cable as Default TV Viewing Source

More than half of TV viewers in a survey said their TV default was an online streaming service — i.e., a subscription-based streaming service such as Netflix, a free streaming service with ads such as Pluto TV, or a live-TV streaming service such as YouTube TV.

That’s according to Hub’s annual “Decoding the Default” study, which since 2015 has tracked the TV source that consumers turn on first when they’re ready to watch.

Online services were 16 points more likely than a traditional cable, satellite or telco service to be consumers’ TV default — an advantage that’s twice as large as it was just a year ago.

In the survey, 55% said an online service is the first source they turn on, up five points from 2020, while 39% said they turn first to a traditional pay-TV service set-top (including live viewing, DVR, or VOD), down three points from last year. The remaining percentages each year default to viewing over-the-air, from an antenna.

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Meanwhile, Netflix has lost momentum as viewers’ default source over the past year. Until 2018, Netflix was on track to surpass traditional pay-TV single handedly as viewers’ first stop for TV viewing. But since then, the proportion defaulting to Netflix has leveled off, and it has actually lost three points since 2020. Although no single other streaming TV service comes close to Netflix as a default for TV, the four other most popular streamers (Hulu, Amazon Prime Video, Disney+, and HBO Max) collectively gained four points in just the past year.

TV default differs dramatically by age. Young consumers were by far the least likely to turn first to live TV channels when they were ready to watch — and the proportions have continued to drop over time. In the survey, barely more than 1 in 10 18- to 34-year-olds defaulted to live channels. But notably, the proportion defaulting to live TV was lower than it was in 2019 in every age group.

Netflix’s overall drop as a default source since last year is especially pronounced among younger viewers. Instead, that group embraced the other streaming services as their top TV destination, with 31% of 18- to 34-year-olds making Netflix their TV home base, down eight points since last year.

Instead, 24% of young viewers turned first to one of the other top five streamers, up an equal eight points since 2020.

“Like most other phenomena in the new TV landscape, the TV sources that viewers’ treat as their TV home base seem to be in a state of constant flux,” Peter Fondulas, principal at Hub and co-author of the study, said in a statement. “Just when it looked like Netflix was set to become the center of consumers’ TV universe, other streamers have stepped up their game to change the narrative.

“What has remained constant, however, is the critical importance of being consumers’ home base for TV in the first place. If and when we reach the point where a critical mass of consumers decides they’ve hit their TV service maximum, the last service to go when viewers begin to scale back is the one service they turn on first.”

Hub’s “Decoding the Default” study was conducted in August 2021 among 1,616 U.S. consumers with broadband, age 16-74, who watched at least one hour of TV per week.

Comscore to Provide Connected TV Measurement for YouTube and YouTube TV

Comscore Aug. 9 announced it will be including YouTube and YouTube TV measurement into its cross-platform service, Comscore Campaign Ratings. The pact with the Google-owned platforms will help Comscore provide marketers with a better understanding of how audiences are consuming content on YouTube and YouTube TV across desktop, mobile, and connected TVs.

Comscore data metrics provides advertisers and agencies with a deduplicated view of reach and frequency across linear TV, OTT/CTV, PC and mobile inventory. This includes measurement for co-viewers on OTT/CTV. The new capability will pave the way for advertisers and agencies to understand combined co-viewing for YouTube and YouTube TV across OTT/CTV as well as incremental reach to their linear TV buys, providing total cross-platform ad measurement.

“People are watching more YouTube than ever — on mobile, on laptops, and especially on our fastest growing screen, the TV, and we want to ensure advertisers can measure their reach across all devices with third-party partners like Comscore,” Debbie Weinstein, VP of global solutions for YouTube, said in a statement. “We also know people are choosing to watch their favorite YouTube content on connected TVs with others, and the inclusion of co-viewing in this new integration will allow advertisers to understand the full scale of the audience they’re able to reach through YouTube CTV campaigns.”

The rise of streaming on CTV devices continues to create new opportunities for advertisers to reach viewers. Amid such growth and with the proliferation of streaming video services, the addition of YouTube and YouTube TV to Comscore will enable one of the largest advertising sources for modern cross-platform measurement.  As previously published by Comscore, more than 80% of CTV reach in the U.S. falls on only five streaming services — and only two are ad-supported.

“This is a critical milestone for Comscore and for the industry,” said Comscore CEO Bill Livek. “Our clients are placing a large portion of their advertising spend with YouTube, and they need a holistic view of how that spend is performing relative to the entire media mix.”

Livek previously headed home entertainment distributor Rentrak, which was acquired by Comscore in 2016.

Google Services (i.e. YouTube) Ups Q2 Revenue 63% to $57 Billion

Google reported second-quarter (ended June 30) services revenue of $57 billion, an 63% increase from revenue of $35 billion in the previous-year period. Operating income skyrocketed 135% to $22.3 billion from $9.5 billion.

Google Services generates revenue primarily from advertising; sales of apps, in-app purchases, digital content products, and hardware; and fees received for subscription-based products such as YouTube Premium and online subscription-based YouTube TV — the No. 2 online TV platform behind Disney’s Hulu + Live TV.

Indeed, YouTube ad revenue alone topped $7 billion in the quarter.

Overall, Alphabet net income shot up 164% to $18.5 billion from $8.9 billion in the previous-year period. Revenue increased 62% to $61.9 billion, from $38.2 billion in the year-ago period.

“In Q2, there was a rising tide of online activity in many parts of the world, and we’re proud that our services helped so many consumers and businesses,” Sundar Pichai, CEO of Google and corporate parent Alphabet, said in a statement.

Cinedigm Offers Legacy Channels as YouTube TV Add-Ons

Cinedigm July 8 announced that its three legacy streaming channels — Dove Channel, CONtv and Docurama — are now available on YouTube TV as optional add-ons, priced at $4.99 each monthly. Google-owned YouTube TV has more than than 3 million subscribers.

“Digital broadcasting has revolutionized television, because it has found a way to work with customers on their terms,” Jennifer Soltesz, VP of business development and strategy at Cinedigm, said in a statement.

Docurama features documentary films, including biographies, true-crime stories, investigations and feel-good stories. Popular titles include: Gangster Empire: Rise of the Mob, Beatles: How the Beatles Changed the World and Rick Steves’ Europe.

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Dove Channel streams family-friendly content, feature films and television titles suitable for all audiences. Content includes comedy classics like Abbot and Costello, young adult series H20: Just Add Water and The Saddle Club and faith favorites like I’m in Love With a Church Girl, among others.

CONtv carries a diverse range of film and television essentials focusing on action/thriller, horror, anime and sci-fi/fantasy genres. With films featuring superstars like Dolph Lundgren and Sean Patrick Flannery (Acceleration), Danny Trejo (4GOT10), and Mark Strong and Taissa Farmiga (Anna), the channel is packed with content for pop culture fans to enjoy.

Through a mix of premium SVOD services and dedicated AVOD and FAST channels, Cinedigm’s streaming portfolio reaches indie film (Fandor), horror (Screambox & Bloody Disgusting) and family entertainment (Dove Channel),  as well as dedicated channels for specialized entertainers, led by Bob Ross (The Bob Ross Channel).

“We look forward to launching additional channels to YouTube TV’s line-up of add-on channels over the next couple months,” Soltesz said.

Is Shine Off Online Pay-Television?

Lost in the hoopla of Disney+ surpassing 103 million subscribers in the second quarter (ended April 3) was the reality that the online TV market leader, Hulu + Live TV, lost 200,000 subscribers during the same quarter. The 5% decline from 4 million subs likely attributed in part to a $10 price hike Disney imposed upon the platform last December.

But Hulu isn’t alone. Sling TV, which Dish Network launched in 2015, lost 100,000 subs in the quarter to 2.37 million. AT&T TV, formerly DirecTV Now and AT&T TV Now, reportedly declined to around 650,000 subscribers in early 2020 — about two-thirds fewer subs when the service launched in 2018.

And Google-owned YouTube TV saw its 3 million-sub base unchanged over the past four months, while T-Mobile this year threw in the towel on its upstart TVision platform with about 100,000 subs. Sony’s PlayStation Vue service shuttered in January 2020 after almost five years of sluggish sub growth.

That’s a trend in the wrong direction considering TDG Research in December 2020 predicted strong growth for the 6-year-old market.

“The number of virtual pay-TV households will increase five-fold by the end of the next decade, topping 24 million by 2030,” senior analyst Joel Espelien wrote in a December 2020 note. “Importantly, this growth will come almost exclusively at the cost of legacy subscriptions.”

Indeed, fuboTV and Philo have added subscribers, the former tacking on 42,550 subs to top 590,000 subs in the quarter. Philo says that as of August 2020, it had 750,000 subs.

Overall, the top publicly reporting Internet-delivered pay-TV services combined for about 6.7 million subs — less than 10% of the top pay-TV providers with about 78.7 million combined subs.

“A whole generation of customers likely viewed [online TV] quizzically, as a solution to a problem they didn’t have,” MoffettNathanson wrote in a note last year. “The real issue was the grid. Not the user interface grid, by the way, but instead the very idea of a [program] schedule. Why would anyone want to view entertainment content on a schedule, much less someone else’s schedule?”

YouTube TV Bows 4K Content, Will Launch Mobile Phone Video Tool to Compete With TikTok

Online TV platform YouTube TV has 3 million subscribers, 85 channels and access to the MLB World Series and the NFL, among other high-profile events. Now, the Google-owned platform is offering subs access to 4K content (4K HD TV required), offline content, and unlimited concurrent streams at home so the whole family can stream on different screens at once.

YouTube TV now supports a combination of SD, HD, 4K, VR, HDR and live video, as well as DVR on nearly every device with an Internet connection — from desktops to mobile, and gaming consoles to VR headsets.

“While the majority of YouTube videos are watched on mobile, our fastest area of growth is the TV,” Neal Mohan, chief product officer for YouTube, wrote in a blog post. “Later this year, we’ll launch a redesign of the YouTube VR app homepage to improve navigation, accessibility and search functionality.”

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Separately, Google in March will roll out YouTube Shorts, a mobile phone-centric platform that aims to compete with TikTok, enabling creators and artists to shoot snappy videos. Currently, Shorts is available in beta in India. Since the beginning of December, the number of Indian channels using Shorts creation tools has more than tripled, and the YouTube Shorts player is now receiving more than 3.5 billion daily views globally, according to the company.

“In the coming weeks, we’ll begin expanding the beta to the U.S., unlocking our tools to even more creators so they can get started with Shorts,” Mohan wrote.

Nielsen Begins Ad-Tracking on YouTube and YouTube TV

Nielsen Oct. 15 announced it would begin tracking YouTube’s streaming TV inventory. Content will be measured through its “Digital Ad Ratings” and “Total Ad Ratings” software to help media buyers and sellers better understand and verify audiences on Google-owned YouTube and YouTube TV apps on connected TVs. CTV refers to any TV that can be connected to the Internet and access content beyond what is available from a pay-TV provider.

More than 100 million people in the U.S. watch YouTube and subscription-based YouTube TV on connected TVs every month, according to Comscore.

Nielsen will now track YouTube beyond computer and mobile devices and expand “Advanced TV” product suite that includes its legacy TV viewership measurement. Nielsen’s first phase of YouTube TV tracking begin in the first half of 2021, and extending to the YouTube app on connected TVs in the U.S. shortly thereafter, ahead of the 2021-22 industry upfronts.

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“As streaming through connected devices surges, measuring the audience is critical as the industry demands a currency grade solution that provides marketers and publishers holistic, cross-platform metrics about advanced TV campaigns,” Scott Brown, GM of audience measurement at Nielsen, said in a statement.

With more than three-quarters of U.S. homes owning one or more connected devices and streaming accounting for 25% of total TV usage, Nielsen contends the value to media marketers and advertisers to account for audiences across all platforms, including connected TV,  has skyrocketed.

The CTV space continues to experience fragmentation as more players launch new services, causing data to be siloed within different platforms, according to Nielsen. The company said YouTube accounts for 20% of all streaming usage in the U.S., and through its tracking software, marketers will have increased confidence in their investments and the ability to better measure the success of their campaigns across platforms.

“Advertisers are asking for third-party measurement partners to provide a complete view of YouTube and YouTube TV audiences, so they can better understand the scale of the audience they’re able to reach through CTV campaigns,” said Debbie Weinstein, VP of global solutions at YouTube.

Hub Study: Online TV Sources ‘Home Base’ for Half of U.S. Consumers

Online TV sources — including subscription video-on-demand services such as Netflix, free services such as Pluto TV, and Virtual MVPDs such as YouTube TV — are now the TV “home base” for half of all U.S. TV consumers, according to Hub’s annual “Decoding the Default” study.

The study since 2015 has tracked the TV source that consumers consider their TV “home base” — the source they turn on first when they’re ready to watch.

“We’ve seen a significant boost in streaming TV service subscriptions since the start of the pandemic in March of this year,” Peter Fondulas, principal at Hub and co-author of the study, said in a statement. “But perhaps more significant than the simple increase in online subscriptions is the profound shift in consumers’ viewing behaviors generally. Instead of reaching first for the cable remote when it comes time to watch TV, more and more consumers are defining TV viewing, first and foremost, as viewing on streaming services. Whether that shift persists once the pandemic crisis has passed is, of course, the billion-dollar question.”

According to the study, 50% of respondents say an online service is the first source they turn on, up from 47% last year. Meanwhile, 42% say their first choice is viewing from the traditional TV set-top box (live viewing, DVR or VOD), down from 47%. (The remaining percentages each year default to viewing over-the-air, from an antenna.)

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For those who default to an online source, nearly half (23% of the 50%) say that online source is Netflix. In fact, Netflix, by itself, is now nearly as likely to be consumers’ TV home base as all live TV channels accessed through pay TV combined. In 2016, live TV from a pay TV service was three times as likely as Netflix to be viewers’ TV default. Netflix trails live viewing by only 7 percentage points.

Fewer than one in five young consumers default to live TV, down 7 percentage points from last year. But more ominously, even among live TV’s strongest adherents — those age 55 or older — the proportion defaulting to live has dropped significantly since just last year. Only 14% of 18-34 year olds turn to live TV before any other source, vs. 21% in 2019. The study found an equal 7-point drop among 55-plus year olds; fewer than half now say live TV is their viewing home base.

The choice of default is driven primarily by two factors — content and ease of show discovery — according to the study. The top reason for making a source one’s default is because it offers access to one’s favorite shows. But a more general content consideration is a top driver as well: wide variety of shows and movies to choose from. Interface simplicity is also a top driver of default, in particular because the service makes it easy to find something to watch.

When consumers decide it’s time to cut back on TV services, they’re much more likely to remain loyal to their TV service default, Hub reports. Hub asked consumers which one TV service they’d keep if they had to drop all others. Among users of each, pay TV service and Netflix were the two most likely to make the cut.

Among users of each service who also treat it as their default, the proportions saying they’d hang on to the service to the bitter end are much higher. For subscribers to the big four SVODs (Netflix, Amazon, Hulu and Disney+), loyalty to the service is two to four times higher among those who default to the service vs. users of each service overall.

Hub’s “Decoding the Default” study was conducted among 1,600 U.S. consumers with broadband, age 16-74, who watch at least one hour of TV per week. The data was collected in August 2020.

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Ending a Relationship

It had been a long time coming.

Cable TV had been a big part of our lives for decades, a constant entertainment companion, but being together so much during the pandemic took a toll on the relationship. Suddenly, those ever-expanding commercial breaks seemed endless after watching ad-free streaming services such as Netflix, Disney+ and Amazon Prime. Even Hulu, which we watched with ads, served up a more palatable break — and conveniently offered a little countdown to tell us when it would be over.

We picked up YouTube TV for live programming, and that was it. The cable relationship was over. We cut the cord.

Apparently, we are not alone. A Roku survey found one in three U.S. households are cord cutters, and many have decided to make the change in recent months, citing the pandemic, the abundance of free AVOD services, and lack of live sports, among other factors.

Aside from the learning curve on how to work the remote to get to the channel or program I want, it’s been a smooth divorce. Kicking cable out also gave us more space. We gained some shelves by ditching the boxes.

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So far, I don’t miss the old companion. I haven’t found a program or channel that I previously had on cable that I can’t find or approximate on our new streaming combo. Sure, I don’t have the convenient clock on the box to see the time. It takes a little more effort to figure out what I want to watch among all the new choices, but, honestly, I don’t miss cable.

It was the growing relationship with our SVOD services, the new-and-improved version of live TV on YouTube TV and the cable bill’s increasing drain on our finances that drew us away.

When we announced the decision to end it, my daughters looked up from their phones and sarcastically said, “Oh, no! We watch so much cable.”

Goodbye old friend.

YouTube TV Hikes Membership Price

YouTube TV has raised its membership price to $64.99.

The new price takes effect June 30 for new members, with existing subscribers seeing the change reflected in their subsequent billing cycle on or after July 30, according to the official YouTube blog.

“We don’t take these decisions lightly, and realize how hard this is for our members,” read the blog. “That said, this new price reflects the rising cost of content and we also believe it reflects the complete value of YouTube TV, from our breadth of content to the features that are changing how we watch live TV. YouTube TV is the only streaming service that includes a DVR with unlimited storage space, plus 6 accounts per household each with its own unique recommendations, and 3 concurrent streams. It’s all included in the base cost of YouTube TV, with no contract and no hidden fees.”

The blog noted the addition of new features to the service and new content from such sources as PBS, Discovery Network, and ViacomCBS, including eight channels, BET, CMT, Comedy Central, MTV, Nickelodeon, Paramount Network, TV Land and VH1, launching June 30.

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“That means you can follow the biggest stories in news, politics and pop culture with ‘The Daily Show with Trevor Noah’; catch up with Catelynn, Cheyenne, Maci, Mackenzie and Amber on ‘Teen Mom OG’; join the search for America’s next drag superstar with ‘RuPaul’s Drag Race’; go on an adventure with ‘SpongeBob SquarePants’; and follow the fictional lives of the Dutton family on the new season of ‘Yellowstone,’” the blog noted.

YouTube TV is among the virtual MVPD services aiming to re-create the offerings of traditional pay-TV.