Mobile is the new TV

• Recent studies reveal Netflix, Amazon and NOW TV have more UK subscriptions than traditional pay TV services
• 2018 was the first year when Pay TV revenues declined, paving way for more online streaming subscribers
• Broadcast TV continues to be popular, but 16 to 34-year olds are shifting to online
• Streaming revenues considerably outstrip physical sales in the music industry

Netflix recently launched its cheapest subscription plan in India at Rs 199 for a month. And everyone started planning for the next binge watch. And, many fell in this advertising quarry. Users will only be able to stream their favourite series and movies on smartphones and tablets.

What triggered them to make available this OTT platform only online?

 Is it safe to say yet that the growing tribe of millennials is responsible for the slow demise of TV, not just in India but all across?

Dipstick survey by the Indian arm of market researcher YouGov and a leading channel, shows that older cohorts use less social media networks than the millennials.  It also highlights most millennials (between 22 and 37 years in 2018) consume news online, and only a minority of the youth reads newspapers or watches TV news. The share of millennials watching online entertainment (48%) exceeds significantly than the share of those watching cable TV (43%).

People are spending more time online than watching TV. And, it’s happening faster than expected.

What is attributing to this structural shift taking place from TV to online viewing? Sameer Nair, programming veteran and current chief executive officer (CEO) of Applause Entertainment, finds the viewing shift is not just in the younger audiences – “ it is happening for the first 100 million viewers—the ones who first got satellite TV, first got internet, first experienced social media and e-commerce. This audience is fatiguing from the sameness of TV content over the past 18 years and seeks a change. The shift is gradual but real.”

eMarketer’s UK senior analyst Bill Fisher said, “consumers in the UK are watching more digital video content, and more of it on smartphones, than ever before,”. “What they’re watching is changing slightly, though, with the influence of quality TV programming being keenly felt. We all know about the impact that subscription video-on-demand platforms like Netflix and Amazon Prime have had on consumer behavior. But even on platforms more associated with user-generated content (a la YouTube), there’s an increasing tilt toward longer-form viewing, often via channels on the platform with high production values. Marketers are watching this trend with interest, particularly given the ongoing saga that YouTube’s been having with brand safety.”

Shift in paradigm

This rise of cord-cutting and smartphone penetration, there has been a radical transformation than what was practised in since the 1980s. Little did we wonder about the following when talking of massive adoption of mobile television streaming through OTT video sources.

• What types of professionally-produced content are being watched the most on the mobile phones?
• Is Mobile TV the new trend? What is the social context of how and where are people watching it?
• Will this cluster of shift in the behaviours across large numbers of users help target the design of new Mobile TV services?

There has been a constant predicament where researchers and debaters say mobile viewing “cannot generate” a relaxing experience as much as that of a television set given the smaller size of the screen; however, exploring the ways mobile is currently being used in a world of near infinite program choice speaks differently. It is, in fact considered as a new mass medium with its own content and usage modes. Content developers are more into understanding what is best suited to this medium, and argues that new types of content must solely focus on mobile viewing experience. While the highlight is in making content pieces that involve shorter attention span and can be viewed in noisy environments, any leading Mobile TV channel must also focus on the triumvirate of content — entertainment, news, and sports.

Consumers’ appetite for video and streaming is insatiable, finds Deloitte.

Consumers are increasingly in control when it comes to selecting media and entertainment options. All thanks to the proliferation of wireless connectivity, mobile devices, and alternative digital media platforms. And, the demands are at an all time high where they expect original, high-quality content at lesser pay packages.

Illustrating major shifts in media consumption, Deloitte finds:

• The incessant growth of adoption of streaming video subscriptions as consumers looks for original content
• Consumers are reassessing the value of their pay TV subscriptions
• The rise of MilleXZials, that is generation X (ages 35–51) now closely mirror the generation Z (ages 14-20) and millennials (ages21-34)

2018 Golden Globe Awards officially recognized the high quality of original content being offered by video streaming services.  The three most extensive streaming video services, Netflix, Hulu, and Amazon (as per the number of subscribers) combined to win 5 of 11 awards in the television category. Media companies are also increasingly going direct-to-consumer with their own digital streaming services. The most practical challenge, however, is that customers may be unwilling to spend for select content over their other paid subscription services. They may find multiple subscription services costly and confusing and prefer to scale back. This is when, experts believe, the content will take over – there is no end to the original content, and the hunger for innovative stories (in any format) is far from dead.

Ofcom’s Media Nations report conducted a comprehensive study of major trends in UK’s television, radio and audio sectors which shows an increasingly fragmented landscape. The key finding include:

• Streaming overtakes the figures in pay TV: Netflix, Amazon Prime and Sky’s Now TV – three most popular online streaming services overtook the number of pay TV subscriptions, at 15.1 million in 2017
• PSB spending less: The BBC, ITV Channel 4 and Channel 5 reported a record low spending on original UK-made programmes in 2017
• Broadcast TV viewing is also declining: The amount of time spent watching broadcast television is seeing a considerable reduction, and it is steeper amongst the children and viewers aged 16 to 34
• Viewing habits shifting: Total daily viewing time across all devices is seen to be 5 hours one minute. Two-thirds (three hours 33 minutes or 71%) was to broadcast content, and 1 hour 28 minutes to non-broadcast content. Among 16 to 34-year-olds, the daily viewing time in 2017 was 4 hours 48 minutes in total. But, less than half (2 hrs11 minutes or 46%) was that of the broadcast content.

Changing viewership

The grounds for this growth in video streaming platforms and their viewership are not challenging to find. A report by PricewaterhouseCoopers (PwC) titled Global Entertainment & Media Outlook 2018-2022, states data consumption in India is set to increase as mobile connections reach 850 million people by 2022. That being said, the country will become one of the top 10 largest video streaming markets in the corresponding years. Clearly, non-linear media is assumed to grow on the back of an increase in lower Internet prices, handheld device penetration, demand for content and entertainment on-the-go.

TV demands a precise schedule, which young people find hard to adhere to. To be sure, TV has forever been and will always be a household device whereas the use of mobile is more personal. This influences the nature of storytelling on TV, which will invariably be “family” oriented rather than exclusive, which is possible on mobile phones. The inherent advantages of online content such as gamification, the convenience of VOD, the variation of content and on-the-go viewing are what attracting more viewers than the traditional cable televisions.

The new age of Mobile Video (Advertising)

If you have to define what’s the one thing that is contributing to the rise in the online video interactions than the traditional offline (TV) content is the lesser distraction available on phones compared to TV. Top line numbers show mobile video viewing is has already eclipsed into desktop’s lion share of video views. This migration can be attributed to the advance of 4G mobile networks that is making mobile video accessible by reduced latency for more consumers in markets.

While on the subject, let’s also understand that mobile video doesn’t just command the OTT platforms. It’s also emerging as the best way to explore products for any purchase. Animoto, a company that provides an online video creation application, found this as the key takeaway point in one of its conference that consumers prefer video over text descriptions for any product.

The space available on smartphone and “phablet” screens are smaller compared to TV and desktop screens, but the effectiveness of mobile advertising through video content is expected to reach new heights.  More so, as they are taking a pivotal role in enhancing and influencing the purchasing process.  The uptick in ad spend will definitely move ad-tech giants to bulk up on mobile video capabilities.

Using mobile video programmatic platform which strike the right Artificial Intelligence (AI) can deliver personalized ads that are laser-targeted to individual users. RBC Capital Markets and Advertising Age found in its research how programmatic advertising has reached a tipping-point and is gaining traction in geometric progression. Digital agencies, today, need little convincing to render how mobile video and programmatic advertising dovetails. The massive opportunities knocking at the intersection of serious drama content and high-energy ads can help induce the right consumer emotion.

• Business Insider Intelligence forecasts that smartphones will account for more than 1/3rd of all online video ads by 2018
• Tablets have grown to account for more than 20% of video ad views (which is almost double than from 2013).

By 2023, digital will surpass two-thirds of total media spending, eMarketer found in February 2018.

Digital ad spend has grown, and now is the time for video ads. Twitter attributed more than half of its ad revenue.

Snapchat also reported its premium mobile video ads crossed 70 percent of the total 13- to 34-year-old U.S. population in the last quarter of 2018. Facebook video advertising to see more activity this year and beyond.

Formats like Stories taking center stage across the Facebook Inc. portfolio and in-stream video delivers more long-form, curated and original programming through Watch and IGTV, says 4C CMO Aaron Goldman.

Why should we care?

Mobile video consumption advances to rise, and the habits people watch traditional TV are changing. Nielsen Total Audience Report showed how live TV viewing among 18- to 24-year-olds has seen a steadfast decline since 2016.

eMarketer forecasting director Monica Peart discussed in one of her conferences about the steady shift of consumer attention to digital platforms. Subsequently, it hit an inflection point with advertisers, which is compelling them to turn to digital to explore the incremental gains in reach and revenues. It’s not far when traditional media advertising will become inert.

To stay ahead of the curve, entrepreneurs and marketers will have to stay abreast of mobile video consumption fads more than ever before. Market research giants such as eMarketer’s predict that with such significant milestone underfoot, mobile will surpass TV sooner than we thought. And, advertisers will need two-fold attention – recognising how much ROI traditional TV ads are delivering while keeping the pace of their video ad investments with online video consumption.