Hiding the Cord Cutting Truth Augustine Fou 2014

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Savvy users have been cord-cutting or cord-shaving for many years. New data shows why they stream and what they stream -- TV shows and movies. This is not good news for pay-tv or premium cable …

Savvy users have been cord-cutting or cord-shaving for many years. New data shows why they stream and what they stream -- TV shows and movies. This is not good news for pay-tv or premium cable companies.

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  • 1. Augustine Fou- 1 - Cord-Cutters are Digital Video Power Users Dr. Augustine Fou http://linkd.in/augustinefou acfou @mktsci .com May 2014
  • 2. Augustine Fou- 2 - Author’s Commentary “The data in slide 3 shows cable companies losing 3% of their subscribers, most of whom went to ‘telephone companies.’ It is somewhat misleading to quote the 0.1% change. While users have not cut the cord, their consumption is entirely different when they stream video content rather than watch linear TV on broadcast or cable.”
  • 3. Augustine Fou- 3 - Cord-cutting is Moving Slowly -3% +14%
  • 4. Augustine Fou- 4 - Cord-Cutter Streaming Usage • Cord-cutters stream 10x more than typical cable subscribers (153GB vs 13GB) • Cord-cutters stream 10x more hours (100 hrs vs 9 hrs) Sandvine: Global Internet Phenomenon Report Q1 2014
  • 5. Augustine Fou- 5 - Why People Stream Video I can’t find what I’m looking for on a licensed site Source: BusinessInsider Poll April 2014
  • 6. Augustine Fou- 6 - What People Stream I stream TV series and movies Source: BusinessInsider Poll April 2014
  • 7. Augustine Fou- 7 - Reasons for Streaming Source: IAB May 1, 2013
  • 8. Augustine Fou- 8 - Streamers Are Picky/Savvy Source: Harris Interactive via MarketingCharts August 2013
  • 9. Augustine Fou- 9 - Streamers Watch Less Pay-TV Source: GfK July 2013 via Marketing Charts
  • 10. Augustine Fou- 10 - DVR Owners Watch 23m Source: Nielsen Dec 18, 2013 Source: Netflix DVR owners watch exactly 23 mins (i.e. skip exactly ALL ads)
  • 11. Augustine Fou- 11 - Younger Demographics Watch More TV Over-The-Top
  • 12. Augustine Fou- 12 - Millennials Watching TV On.. Source: Deloitte via Engadget March 2014
  • 13. Augustine Fou- 13 - Live Broadcast vs Online TV Source: Diffusion Group March 2014 via MarketingCharts
  • 14. Augustine Fou- 14 - http://www.marketingcharts.com/wp/tel evision/streaming-and-cord-cutting-is- there-a-link-42101/ Streamers Are Cord-Cutters
  • 15. Augustine Fou- 15 - http://www.marketingcharts.com/wp/tel evision/streaming-and-cord-cutting-is- there-a-link-42101/ Use Netflix vs Pay-TV
  • 16. Augustine Fou- 16 - YouTube and Facebook Video is Getting Large Enough
  • 17. Augustine Fou- 17 - It turns out that cord-cutting isn’t the only threat facing cable channels. Several of the big ad-supported online video outlets, including Google Inc’s YouTube, AOL and others, plan this upfront season to target some of the ad dollars that currently flow to cable channels, industry executives say. The web video outlets see a vulnerability in second tier cable networks, and to a lesser extend in the local TV-station market, executives say. According to multiple media buyers and ad sellers in the Web video industry, digital media companies are looking to draw direct comparisons between their audiences and cable TV networks, a match-up Web video outlets think they can win. Buyers say Google is likely to be the most aggressive on this front, given YouTube’s massive size and its young demographics that don’t necessarily watch a lot of TV. The company has been selling directly against cable networks, with pitches like “X YouTube net reaches more women than E! or Awesomeness TV reaches more tweens than ABC Family.” In one pitch, for instance, YouTube cited Nielsen data from November showing that it reached 49% of all 18 to 34 year olds, versus 45% for FX, 44% for TBS’ comedies, 41% for Comedy Central and 40% for AMC. YouTube also thinks it can capture more local broadcast and cable ad dollars from national advertisers looking to boost spending in certain markets. The company is targeting automotive and wireless advertisers in particularly, said executives with direct knowledge of YouTube’s plans. Loss of Ad Dollars to YouTube Source: WSJ March 2014 Don’t forget about Facebook video ads which debut at $1 - $2.5 million a day. Source: Business Insider, March 2014
  • 18. Augustine Fou- 18 - Dr. Augustine Fou – Digital Consigliere “I advise clients on optimizing advertising across all channels. When users are moving away from traditional TV viewing, advertisers need to find new ways of reaching them and attracting their attention.” FORMER CHIEF DIGITAL OFFICER, HCG (OMNICOM) MCKINSEY CONSULTANT CLIENT SIDE / AGENCY SIDE EXPERIENCE PROFESSOR AND COLUMNIST ENTREPRENEUR / SMALL BUSINESS OWNER PHD MATERIALS SCIENCE (MIT '95) AT AGE 23 @acfou ClickZ Articles: http://bit.ly/augustine-fou-clickz Slideshares: http://bit.ly/augustine-fou-slideshares LinkedIn: https://www.linkedin.com/today/author/84444-augustinefou
  • 19. Augustine Fou- 19 - Related Articles Augustine Fou- 19 - http://www.slideshare.net/augustinefou/viewability-of-display-ads-vs-video-ads- 2014-by-augustine-fou http://www.slideshare.net/augustinefou/video-ads-vs-tv-ads-by-the-numbers- comparison-by-augustine-fou http://www.slideshare.net/augustinefou/viewability-of-tv-ads-vs-digital-ads-2014-by- augustine-fou http://www.slideshare.net/augustinefou/digital-advertising-benchmarks-2014-by- augustine-fou http://pt.slideshare.net/augustinefou/video-ads-vs-tv-ads-by-the-numbers- comparison-by-augustine-fou http://www.slideshare.net/augustinefou/cord-cutting-phone-tv-by-augustine-fou-and- tery-spataro