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With Netflix series The Crown crowned Best Drama at the Golden Globe Awards, Roy Morgan Research reveals how many Australians have a subscription at home, how much commercial television they still watch, and why audience engagement will become the metric that matters for the broadcast networks.
One in four Australian homes now have a Netflix subscription, Roy Morgan’s latest data to the end of 2016 shows. An estimated 5,862,000 Australians aged 14+ (29.5 per cent) now have access to the Subscription Video on Demand (SVoD) service (via 2,268,000 household subscriptions).
Netflix subscribers watch less commercial TV than others—but this is not simply because they have now have SVoD in the home. Many subscribers were already commercial TV, which was a driving reason to subscribe in the first place.
Among today’s Netflix subscribers, 18 per cent still watch a Heavy amount of commercial television (classified as more than three hours on a normal weekday), and another 20 per cent watch a Medium amount of two to three hours. 42 per cent watch less than two hours’ worth, and the remaining 20 per cent say they don’t watch any at all on a regular Monday to Friday.
Of course, a majority of seven in 10 Australians don’t have Netflix in the home. Among them, 27 per cent are Heavy Commercial TV viewers, 21 per cent are Medium, 37 per cent are Light and only 16 per cent watch none on a typical weekday.
“Netflix finished 2016 in almost 2.3 million Australian homes,” advised Michele Levine, CEO, Roy Morgan Research. “Commercial TV networks (and their advertisers) are right to be concerned about the popularity of SVoD, and how much attention it will ‘steal’ from free-to-air television.”
“Many Netflix subscribers, especially in the early days, weren’t big viewers of commercial TV—so the industry wasn’t necessarily losing audiences it had to begin with. Heavy commercial TV viewers remain the least likely to have Netflix—however subscriptions among this group have grown over 50 per cent in 2016, faster than any other viewing segment.”
“Free-to-air networks, industry bodies and advertisers must now pay closer attention to SVoD subscription rates and usage habits among their heaviest viewers.”
“One core issue will be how heavy commercial TV viewers use Netflix, and other SVoD services such as Stan, if and when they do subscribe. Will it be only for a weekly movie, a series binge-viewed over a weekend, or become the first port of call every time the TV is turned on?”
“In large part, this will all come down to viewers’ engagement with particular TV shows. Roy Morgan measures how much of each show’s audience loves it, especially chooses to watch, has a household member in control of the remote, or is tuned in only because there’s nothing else on. As SVoD grows (and offers award-winning ‘must-see’ new shows such as The Crown), networks and advertisers won’t be able to rely on reaching unengaged viewers.”
“The time is now to start focusing on audience engagement. Multiple broadcast channels, live streaming and catch-up platforms should give the commercial TV networks the ability to offer highly engaging programming to all different segments, keeping them tuned in and upholding free-to-air as the go-to at-home entertainment option,” she suggested.