The television landscape is undergoing a seismic shift. According to Nielsen, traditional TV usage – which includes both broadcast and pay TV – fell below 50% for the first time ever in July. This decline is juxtaposed by the rise of streaming, which accounted for nearly 39% of TV usage in the same month.
I wouldn't get too worked up about this; the July book always sucks (summer reruns, hot weather, outdoor sports, etc.) and – piling on – the WGA is on strike so there are no new late night shows.
That said, major pay-TV providers like Comcast and Charter have been feeling the pinch, with significant quarterly drops in subscribers. The pandemic only accelerated this trend as streaming services became the go-to entertainment source for many. While streaming giants like Netflix and Disney+ have been at the forefront of this revolution, their subscriber growth has recently slowed. Newer platforms, such as Paramount+ and Peacock, are witnessing growth, albeit from a smaller base.
Interestingly, as the traditional TV business contracts, streaming platforms are pivoting from prioritizing subscriber growth to focusing on profitability, which is evident in the rising subscription costs across various platforms. Additionally, advertising is becoming a more significant revenue driver for these platforms, and there's a concerted effort to curb password sharing and reduce content expenses.
However, it's worth noting that Nielsen highlighted that licensed programming from traditional outlets remains a significant draw for viewers. For instance, the series "Suits," which originally aired on NBCU's USA Network, has been a massive hit on Netflix.
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ABOUT SHELLY PALMER
Shelly Palmer is the Professor of Advanced Media in Residence at Syracuse University’s S.I. Newhouse School of Public Communications and CEO of The Palmer Group, a consulting practice that helps Fortune 500 companies with technology, media and marketing. Named LinkedIn’s “Top Voice in Technology,” he covers tech and business for Good Day New York, is a regular commentator on CNN and writes a popular daily business blog. He's a bestselling author, and the creator of the popular, free online course, Generative AI for Execs. Follow @shellypalmer or visit shellypalmer.com.
