IHS Markit has released findings from its Cross-Platform Television Viewing Time 2016 report, which analyses TV consumption trends across the ‘big five’ European markets: France, Germany, Italy, Spain and the UK, and suggests that linear television viewing declined across those markets in 2016, with personal video recorder (PVR) time-shifted viewing starting to plateau as PVRs become standard in pay-TV offerings.
In the past two years, an increasing proportion of TV consumption moved to on-demand platforms due to the prolific growth of online video services and content availability.
Across the big five European markets, total TV revenue – including pay-TV subscriptions, advertising and public funding – declined marginally in 2016 to €58 billion from €58.3 billion the prior year. Public funding revenue declined by 5 per cent, while pay-TV revenue increased by 2 per cent, largely driven by on-demand revenue, which grew by 10 per cent. In comparison, online video generated €5 billion in revenue in 2016, rising 32 percent from 2015.
According to Fateha Begum, associate director for television media at IHS Markit, despite declines, linear TV will continue to account for the bulk of television viewing and must reach a point of plateau. “However, traditional TV operators need to address the fact that competition for consumers’ time and media spend is intensifying,” she added.
To adapt to shifts in the market, pay-TV operators have been bolstering their services by launching next-generation set-top boxes, enhancing on-demand catalogues and investing in new platforms and content.
Research by IHS Markit indicates that the average number of on-demand titles offered by UK pay-TV operators increased by 13 per cent between 2015 and 2016. Adaptations to online-style binge viewing is also evident, with the same operators showing a 31 per cent increase in complete box sets during this same time period.
Increased connectivity poses both threats and opportunities for traditional pay-TV operators
Digitally mature markets such as the UK and France saw total viewing time stabilise in 2016 despite seeing the highest rate of growth in non-linear viewing. “Further competition for consumers’ time is coming from beyond video because there’s a wide range of media services at their fingertips,” Begum advised.
“The rising availability of connected set-top boxes presents an opportunity for pay-TV operators to bring some of the connected experiences to the big screen. We expect the media and entertainment markets to become increasingly muddied as players, including social media companies, look to expand their portfolios,” she said.
Linear TV continues to make up the lion’s share of consumers’ viewing time
Time spent on linear TV viewing in Italy far exceeded that of its European counterparts, followed by Spain. Both markets have seen declines in linear viewing as non-linear platforms make strong inroads into television consumption. “Time spent viewing online short-form content in Italy is notably higher than in any other of the big five European markets,” said Rob Moyser, analyst for television media at IHS Markit. “Italy’s low fixed broadband penetration has encouraged consumers to access the internet via mobile devices instead of traditional broadband networks.”
Germany was the only market among those analysed in the report to achieve an increase in linear viewing time and, subsequently, total viewing time in 2016. “Despite nearly a 20 per cent increase in non-linear viewing time, new methods of consumption have had minimal impact on traditional TV in Germany,” Begum noted.