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TiVo Report: Media Fragmentation, Content Fatigue Growing

As media fragmentation continues to grow, there are signs of “content fatigue” among many TV viewers, but there are opportunities for the TV industry to combat that fatigue by exploiting new technologies to achieve 
“new and better user experiences,” according to TiVo.

“Because consumers have access to a seemingly endless array of programming from a wide variety of sources, they’re watching more content types than ever before,” the company said in the “TiVo Video Trends Report: January 2019,” made available Jan. 22.

The report was based on a survey of more than 4,400 viewers 18 and older in the U.S. and Canada that was conducted in the fourth quarter of 2018 by an unspecified third-party survey service and then analyzed by TiVo.

Live TV is still favored by viewers overall, but streaming content providers including Netflix and YouTube are “gaining ground” and “multi-service usage is becoming the norm, with the average household among survey respondents using 2.75 services — a 26 percent increase in service usage since 2017,” TiVo said in the report.

Although television has “evolved in recent years, more than 80 percent of respondents still have cable/satellite service, and the majority are satisfied with it,” TiVo said, noting that almost 25% of respondents indicated they were “very satisfied” with linear TV service and pay-TV video on demand.

Meanwhile, with the shift in content consumption, consumers are taking advantage of the growing number of choices available to them, TiVo said. Most respondents said they were planning to remain in the pay-TV ecosystem in the next six months, according to TiVo. But the loyalty of 22.8% of respondents was “undecided” as to whether they would leave or stay with their current pay-tv providers, TiVo said.
A whopping 81.2% of respondents said they planned to stay with their current pay-tv providers, switch to another pay-tv provider or were undecided about their pay-tv service plans six months from now, according to TiVo.

But 18.8% said they planned to cut the cord to a non-pay-tv/live TV service, TiVo said. Among those who already cut the cord, 80.2% said they did so because pay-tv was too expensive, according to TiVo.
Consumer age is a key factor that can predict cord-cutting, based on the “wide gap in average ages between ‘cord-only’ and ‘cord-never’ respondents,” it said. The average age for “cord-only” viewers — those with only pay-tv service — was 52.8, whereas “cord-never” respondents — those who never had pay-tv — was significantly younger, with an average age of just 37.3, it said. Just under 17% of respondents who cut the cord did so in favor of antenna use, according to TiVo.

Those watching online video content including YouTube, Twitch and free network content reported the highest “very satisfied” rates among those surveyed. Considering the huge number of consumers who cut pay-tv service due to price, it was “not surprising that free content produces strong satisfaction rates,” TiVo said.

Despite the “high level of adoption and satisfaction in the pay-tv space, some signs of consumer burnout are apparent,” the company went on to say, pointing to the many different content types and providers to pick from now, as well as the “myriad” number of viewing device options.

“Once a highly sought-after option among consumers, interest in à la carte TV channel packages has decreased 12.8 percent year over year, and almost thirty (29.1) percent of respondents are no longer interested in the option at all,” TiVo also pointed out. Although the major networks dominate channel popularity, specialty channels “rule” when it come to the willingness of consumers to pay, TiVo said.

Many of the most popular channels are major networks, but most of the channels consumers are willing to the pay the most for are niche — and “one-third of those with the highest channel price tags cater to a particular type of sport or individual sports conference,” such as the Big Ten Network, TiVo said, adding: “It’s likely those who seek out more targeted content are also willing to pay more for it.”
Streaming devices, meanwhile, are “gaining ground” as the main access point for pay-TV, according to TiVo. Twenty-two percent of respondents accessed pay-TV via such a device, with 26.2% replacing their set-top box altogether with a streaming device, it said.

More than a third of respondents don’t own a streaming device, such as a smart TV or Amazon Fire Stick, yet, TiVo said. But, of those who do, usage in the last three months wasn’t high, “further suggesting traditional television screens reign supreme — for now,” it said.

On the fragmentation being seen, TiVo said: “TV viewers now demand multiple services to get the content they need — though how many is too many remains to be seen. Service-bundling is the new norm, as evidenced by the top three service bundles.”

Almost a third of respondents (30.7 percent) aren’t using any major monthly over-the-top (OTT) or subscription video on demand (SVOD) services, and that number “partially aligns with just over one-fifth of respondents (21.5 percent) who only have linear pay-TV service,” TiVo said.

It added: “Overall, consumers are using a variety of services, and with the exception of several ever-popular categories (pay-TV and Netflix, for example), they’re not flocking to any particular content providers or services. Instead, they’re demanding more content from more sources than ever before. In this fragmented landscape, providers have to know how to attract and keep their subscriber base. Users may be exhausted by the available content choices, but they still want them. Ultimately, it’s up to industry players to help them find what they want to watch, when they want to watch it.”

Network apps are seeing usage on mobile devices, but “there’s plenty of room for growth,” TiVo also said, adding: “While consumers now have more content available to them and use their television screens in more ways than ever before, nearly 60 percent of respondents still don’t use any TV network apps on mobile devices.” Of those who do use TV network apps on their devices, the most downloaded app was ABC, at 10.4%, followed by A&E (8.5%), CNN (7.8%) and Cartoon Network (7.7%).

Perceived accuracy of pay-TV text search has remained high in the past year, with almost 90% of respondents stating they found results to be accurate, TiVo said.

Voice search use and awareness, meanwhile, are also “on the rise among survey respondents,” it said, adding: “The number of respondents using their voice to search for something to watch went up by 27.4 percent since Q4 2017, and the number with access to the feature also rose by 20.9 percent. Another 18.3 percent of respondents would like access to voice search, while a third are uninterested.”

In conclusion, TiVo recommended that service providers “maximize the expanding awareness, perception and sophistication of search and recommendations capabilities — with a special emphasis on voice capabilities — to meet these challenges” being seen with content fatigue.

“They’ll also need to devote resources to educating skeptical consumers and building/rebuilding the trust of their customers,” TiVo said, adding: “A majority of our survey respondents rely on user experiences or are interested in new ways of discovering the right content. Whether by text, voice or an upcoming method, viewers have traditionally and will continue to experiment with new ways to navigate their screens and content services. As a result, there are untapped opportunities for oering better entertainment experiences to an eager, receptive audience.”