Netflix Caused TV Viewership to Drop 50%

netflix tv decline on tablet person in bed — Image used with permission by copyright holder

Americans are spending less time with their eyes glued to a television screen, but that doesn’t actually mean they’re watching less … television. It’s a classic example of semantics trumping reality: While TV viewership went down 3 percent last year, a new study suggests that people aren’t trading in this time to be one with nature or engage in some other physically stimulating activity. Instead, they’re watching Netflix.

As per a report from Michael Nathanson of MoffettNathanson, Netflix was responsible for around 50 percent of the overall drop-off in TV viewing time in the U.S. In fact, American Netflix subscribers are estimated to have streamed a stunning 29 billion hours of video in 2015, whereas the global Netflix community managed to binge on a total of 42.5 billion hours.

And this past year’s data, Nathanson says, isn’t an outlier. Rather, it represents a trend showing Netflix’s (and other streaming services’) increasing popularity. By 2020, the analyst says, streaming hours will account for 14 percent of all TV viewing. And while this is a burgeoning figure, he notes, it doesn’t mean that Netflix will render the television set and major broadcast channels entirely obsolete.

“Currently, Netflix is a source of industry pain, but not necessarily a cause of industry death,” he wrote in his study.

But television executives are certainly none too happy about this particular pain point. As Variety points out, Time Warner CEO Jeff Bewkes compared Netflix to the Albanian army last year, and further noted that Time Warner was considering “delaying the SVOD [streaming video on demand] licensing window for some of its content as it evaluates the best monetization options in a fast-changing TV landscape.”

This is interesting given that Time Warner is not, in fact, one of the companies suffering as a result of Netflix’s growth. In fact, the total viewership of Time Warner, Scripps Networks Interactive, AMC Networks, and Discovery Communications actually went up in 2015. That was not the case for all networks — A&E saw a 15-percent drop in viewing hours, Viacom declined 13 percent, and both NBCUniversal and Disney were down by 5 percent.

That said, for households that are Netflix subscribers, TV viewership did indeed take a hit. Netflix subscribers watched CBS 42 percent less than non-subscribers, Fox took a similar 35-percent hit, ABC a 32-percent hit, and NBC a 27-percent hit.

Variety does point out one caveat: the analysis of television viewership does not include online and mobile viewing of TV networks, but whereas these numbers are adjusted for co-viewing, Netflix’s data is taken per household. And as Variety reports, “according to Nathanson, that means Netflix per-person viewing is underrepresented relative to Nielsen Live+7; thus, the analyst assumes the two factors largely cancel each other out.”

So sure, parents. Your kids (and you) may be watching less TV. But you might have gone out of the frying pan and into the fire with this one.

Netflix is causing us to watch less TV, study reports

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