Television Accounts for Less than Half of U.S. Viewing Time for the First Time
Powered by shows like “Suits” on Netflix, streaming’s share of U.S. viewing time grew to a new high in July, while television viewing fell below 50% for the first time, according to new Nielsen data.
The milestone is the latest sign of the rapid erosion of the cable-TV bundle, which has lost about a quarter of its subscribers over the past decade, as more Americans cut the cord in favor of streaming services like Netflix, Google’s YouTube and Disney’s Hulu.
Cable television accounted for 29.6% of total U.S. viewing time in July, while broadcast attracted 20%, Nielsen said in a release published Tuesday. Streaming services, meanwhile, captured 38.7% of Americans’ viewing time, while a category labeled “Other”—which Nielsen says includes usage such as DVD playback and gaming—accounted for the remaining 11.6%.
The growth of streaming platforms at the expense of cable and broadcast TV networks has accelerated in recent years, as most entertainment conglomerates introduced their own direct-to-consumer services to take on industry leader Netflix. As they sought to rapidly grow their subscriber bases, many of them chose to make their highest-profile and costliest content available exclusively on streaming.
While original content helps reel in subscribers and build streaming brands, the most-watched programs are sometimes older TV shows. Last month, the show Americans spent the most time watching was “Suits,” a legal drama starring Meghan Markle made for cable TV that made its debut more than a decade ago.
The show, which became available on Netflix in June, was watched for nearly 18 billion minutes in July, Nielsen said. Markle left the show before marrying Prince Harry in 2018. “Suits” is also available on Comcast’s Peacock.
YouTube was the most-watched streaming platform in the U.S. last month, with 9.2% of overall viewing time, while Netflix, with 8.5%, was second. In addition to “Suits,” another streaming show that performed well was “Bluey,” an Australian cartoon about a family of dogs available on Disney+.
The erosion of traditional TV is picking up pace, while overall streaming usage grew by a quarter from July 2022, a 12% faster pace of growth than a year earlier. Streaming reached its highest-ever share of total viewing, Nielsen said.
While consumers are gravitating to streaming in larger numbers, Hollywood’s titans aren’t having an easy time making money on it. Since they joined the streaming wars in earnest around 2020, entertainment giants have lost tens of billions of dollars as they spent big on content while charging bargain-basement prices for their services in pursuit of fast growth.
Many companies have changed course over the past year or so, removing content from their streaming platforms to cut costs and launching advertising-supported versions of their services that give them a chance to broaden their appeal and bring in more revenue.
Most streamers are also raising prices significantly. The average cost of watching a major ad-free streaming service is going up by nearly 25% in about a year, according to a Wall Street Journal analysis, as companies bet that customers will either pay up or switch to their cheaper and more lucrative ad-supported plans.
Several streaming services started offering some live-sports coverage in recent years, which added to their costs while further threatening the viability of pricey pay-TV packages. U.S. households spend about $103 a month on average for cable TV, according to S&P Global Market Intelligence.
Peacock and Apple TV+ now carry a number of Major League Baseball games exclusively, while Amazon’s Prime Video has become the primary home of the National Football League’s “Thursday Night Football.”
Even companies that generate significant amounts of revenue offering live sports on their cable channels are exploring offering them on their streaming platforms, a balancing act as they look to grow their streaming subscriber bases without cannibalizing their ailing TV-network businesses.
Warner Bros. Discovery, home of the TNT, TBS and CNN cable networks as well as the Max streaming service, earlier this month said it is working on bringing news and live sports to its streaming offerings in the U.S. The company has sports rights for several high-profile leagues including the National Basketball Association and Major League Baseball.
Disney’s ESPN, meanwhile, is hunting for a strategic partner to aid its transition to streaming. The network has held talks with potential partners and investors. It is working to make a stand-alone version of its flagship TV channel available to cord-cutters in two to three years, or once its reach in the cable-TV world falls below 50 million households, the Journal previously reported.
About 75 million U.S. households still subscribe to a pay-TV package, down from a peak of around 100 million about a decade ago.
“Taking our ESPN flagship channels direct-to-consumer is not a matter of if, but when,” Disney Chief Executive Bob Iger told investors last week during a conference call to discuss the company’s latest quarterly earnings.
Source: msn.com