Netflix to Blame for Recent Decline in Traditional TV Ratings?
November 3, 2014
According to Bernstein Research senior analyst Todd Juenger, there has been an unprecedented drop in TV ratings during the summer and fall seasons, which can be attributed to a growing number of viewers opting for streaming services such as Netflix, Amazon and Hulu. Juenger suggests that traditional ad-supported TV viewing has declined over the last year by an average of 13 minutes per day, while Netflix viewers are spending 12 minutes more each day watching video content via the video service.
“Other analysts, along with TV industry executives, have offered other theories to explain the drop,” reports Re/code. “The most comforting explanation, if you’re a TV programmer, is that the ratings drop isn’t real — people are still watching the same amount of TV, but it’s not being measured correctly.”
“But if Juenger’s argument is right, that’s very bad news for the TV guys. And not just because the eyeballs really have disappeared. What makes it even worse for the TV guys is that they’ve helped create the problem, by selling off their old shows to Netflix and the other services.”
Networks have been licensing older content to streaming services for several years, largely to make up for declining syndication and home video sales. By not offering in-season shows, the networks felt confident the approach would not cannibalize their own distribution.
However, if Juenger’s math is accurate, it seems Netflix subscribers are finding enough content between original series and older TV shows to keep them satisfied.
At this point, the loss in profit could be too significant for the major networks to stop selling shows to the likes of Netflix, Hulu and Amazon. And if they did not work together to approach such a change, an individual network left in the cold could risk losing ratings and digital syndication revenue.
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