OTT's Market Jumps: How Broadcasters and Advertisers are Leveraging OTT
by Cathy Corcoran
The good news is that media consumption is growing, with the average American spending an astounding 73 hours per week viewing media, up from 64 hours per week just one year ago. The bad news - depending on your company, of course! - is that more than 50% of viewing is happening on screens other than traditional TV sets.
More than two-thirds of US households now have the capability of viewing OTT programming. Along with big cable bundles that include Netflix, Hulu, Amazon Prime and other streaming services, consumers are also watching using Apple TV, Roku, Amazon FireTV Sticks, Google Chromecast and other devices.
“OTT is big, it’s growing, and it’s here to stay,” said Jeff Wender, Managing Director of Local Client Solutions for Nielsen, “but with this change, there’s tremendous opportunity for broadcasters, marketers, agencies and advertisers to profit.”
Wender and Kelly Abcarian, SVP of Product Leadership for Nielsen, presented data on OTT viewing at NATPE. The data is gathered from Nielsen meters and technology inserted into programming from the streaming services themselves.
But before traditional broadcasters go into panic mode, much of the content viewers watch on OTT is still network fare and local news. Shawn Makhijani, Senior Vice President of Business Development and Strategy for NBCUniversal Owned Television Stations, said, “Local stations are partners with traditional networks and they have invested heavily in local news, weather and sports. We know that viewers still want to watch that programming. What’s changed is that they don’t necessarily watch this content on their TV sets in their living room. They watch on their phones at work, or on their IPads while they’re lying in bed.”
Panelist Federica Tremolada, Head of International Partnerships for YouTubeTV said that, when they launched their new TV service, they promoted it as mobile-centric. “We wanted to break the association between ‘watching TV’ and ‘sitting in front of a TV set,’” she said, and added that the exponential growth of the new service has been planned for years, but its actual implementation happened very quickly. The service grew from five US TV markets one year ago to 80 markets currently.
YoutubeTV viewers can watch live TV from more than 40 networks and stream OTT programming from Netflix and other OTT providers for $35 per month. Individual accounts include six accounts per household and unlimited Cloud storage for DVR.
Stacey Schulman, EVP of Strategy & Research for Katz Media Group, said that some broadcasters call OTT a “fourth wave,” but she calls it “a tsunami.” She said that everything is shifting, and from local stations’ perspective, it’s all about how the consumer is able to get content and engage with that content.
“For instance,” she said, “every local station airs stories about what’s happening on Main Street, information that’s specific to its individual market, but there are many stories - lifestyle, human interest, even food - that can be translated across market borders and be of interest in any market.” She said that the sales force can present these opportunities to advertisers and bundle sponsorships that will be both locally and nationally appealing.
Shawn Makhijani said, “The days of having a digital sales force and a linear sales force are over. Advertisers are increasingly looking for packages that bundle linear and digital. When they want to buy spots on (NBC hit) "This is Us," they want those viewers wherever they are and whenever they’re watching. This can be a boon to the sales force.”
All panelists agreed that when Nielsen is able to provide more integrated data from linear and digital, it will be welcomed as a tool for broadcasters and OTT providers alike.
Stacey Schulman said, “We used to say that we were in the content business. Then we said we were in the audience business. Now we know we’re in the data business. Everything is about collecting data and using it effectively.”
Shawn Makhijani said, “Even if they can watch 200 channels, most viewers are still going to want to watch the Super Bowl and the Olympics. They’re going to want to know about the hurricane or the blizzard that’s bearing down on them. They can get that programming from us. It’s just now they can get it whenever they want on whatever device they want. And that’s good for everyone.”