23 JUN 2022

Is over-the-air plus over-the-top the new perfect TV bundle?

According to a recent Nielsen television custom survey, 80% of audiences in over-the-air homes in the United States say they also subscribe to a streaming service.

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Much has been said about the impact of streaming on the way audiences engage with TV, but the extent is no better exemplified than by the behavior of audiences in TV homes who do not pay for cable or satellite programming. A specific subset of these homes, which rely on a digital antenna for free, over-the-air (OTA) programming, watch the most broadcast programming of all TV households in the United States, but that is starting to change, according to Nielsen's latest report.

The significant amount of broadcast TV viewing within these homes certainly is not surprising, given that is what digital antennas provide access to. However, increased connectivity and the growing abundance of over-the-top content is shifting the viewing behavior among these former broadcast programming stalwarts to provide more of a balance with their news and sports-heavy TV diets.

While audiences in OTA homes still watch more broadcast programming than those in broadband and cable plus TV households, they are watching less of it than they have in the past (1:54 per day vs. 2:25 in 2018), complementing their broadcast TV consumption with streaming video viewing. In fact, audiences in OTA homes now watch more streaming content than audiences in homes with cable or satellite programming, Nielsen revealed.

Perhaps most interesting amid the changing behaviors of TV audiences is the overwhelming stability of this portion of the TV household universe in the United States. While the percentages of broadband and cable plus households have shifted dramatically over the past few years, the percentage of OTA homes has remained very stable. In fact, it has actually increased.

Despite their broadcast-focused roots, the shifting viewing behaviors of audiences in OTA homes mirrors that of the general TV population, with streaming content moving to the forefront. According to a recent Nielsen TV custom survey, 80% of audiences in OTA homes say they also subscribe to a streaming service. And among the homes with access to OTA and streaming content, two-thirds of the audience say they watch more streaming content than broadcast programming.

This consumer behavior tracks with Nielsen TV panel data, as the percentage of OTA homes without any additional SVOD or virtual multichannel video programming distributor (vMVPD) service is steadily declining. The median age in these OTA-only homes is 61, compared with 45 for those with SVOD and 49 for those with SVOD and vMVPD.

Cost has always been a factor for many OTA homes, and that factor is also reflected in what they stream, as 50% of the OTA viewers in Nielsen's recent survey said they watch free, ad-supported streaming services, twice the percentage of TV viewers with other programming options (cable, satellite, etc.). Among all TV viewers, just under 70% of OTA audiences say they spend less than $100 each month for their TV programming. But when asked about the features they look for most in a TV service, OTA audiences rank “ad-free” and “ad skipping” at the bottom of their priority lists, presenting significant upside for brand advertisers.

“Despite the ongoing evolution of TV viewing, there are two key constants: consumers will continue gravitating toward streaming content, and news and sports content will continue to attract significant audiences (last year, sports accounted for 98% of the top 50 most-viewed TV programs). These constants present both stability and opportunity for the OTA market, given what we know about OTA audiences: they watch more local news (local and national), sports and daytime TV than other audiences, and they are growing their streaming diets,”  the report says.

“But all TV audiences love news and sports programming, which is where the opportunity is for broadcasters, largely because many audiences do not know enough about the OTA options in their areas, or how to access them. Among the audiences who said they are not likely to buy a digital antenna, 35% said it was because they do not know what channels are available to them. When asked non-OTA audiences how likely they would be to buy an antenna once they knew they could watch broadcast TV without paying a fee, 60% said they were somewhat or very likely,”  the report concludes.