The number of households ditching traditional TV in favour of online video is on the rise. What does this mean for broadcasters?
Last month, Nielsen coined the name of a growing trend among American consumers – Zero TV households. Zero TV households are homes which have ditched televisions in favour of online and non-traditional services to watch content. The platforms that Zero TV households are using include streaming networks, smart TV apps, connected TV’s, mobile devices and media tablets. However, these households do still own televisions and only make up a small percentage of the population (5% according Nielsen), but it is a growing trend and for obvious reasons traditional TV broadcasters are becoming concerned.
A majority of these Zero TV households have shifted away from traditional TV in favour of big name streaming services such as HBO Go, Netflix and Hulu. These services allow users to select and watch content on – demand from a vast collection of movies and TV shows. This library of online content is ever-growing as new films and TV serials are added frequently from an increasing number of content providers.
Technological developments in mobile video and the offer of online only programming (such as House of Cards) has only expedited this transition, so much so that the Associated Press recently reported that the increasing number of Zero TV households was making broadcasters nervous.
The Associated Press quoted a research firm which stated that telecoms, cable and satellite providers reeled in a mere 46,000 new video customers collectively, which is a small fraction of the 974,000 new households created last year in America. Interviews were also conducted with a number of viewers who regularly watch TV shows. The viewers conveyed a lack of interest in registering with a cable television service, with many stating they rely completely on services like Amazon Instant Video or Netflix, both of which are less than $10 a month.
Despite some broadcasters being unhappy about this trend, for other industries it is a positive development as brands all over the world capitalise on the effectiveness of online video advertising. More viewers converting to online streaming services will ensure that online and mobile video ads campaigns are an increasingly viable option for marketers in the foreseeable future.