24 MAR 2021

THE NEW "NORMAL TV" IN THE US LOOKS LIKE IT’S HERE TO STAY

According to Hub’s newest wave of “Predicting the Pandemic” research, consumers’ reliance on streaming services seems to have shifted from “stop-gap” to established behavior.

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One of the ways Americans reacted to pandemic restrictions during 2020 was to load up on TV streaming services to help fill their shelter-at-home time. But according to Hub’s newest wave of “Predicting the Pandemic” research, consumers’ reliance on streaming services seems to have shifted from “stop-gap” to established behavior. “What’s been most interesting to us in our pandemic-related research has been trying to determine which pandemic-induced changes in TV behavior will persist once life begins to return to normal,” said Peter Fondulas, principal at Hub and co-author of the study. “This wave of the study strongly suggests that Americans have grown more than just accustomed to the TV viewing adjustments they’ve made during the pandemic, and are ready to embrace a new, streaming-centric normal”.

In 2020, most TV consumers said they were watching more hours of TV than before the pandemic. Today, with new streaming providers offering a steady diet of TV and movie content, their TV viewing has ramped up even further. 77% of TV viewers in February 2021 say they’re watching more TV now than before the pandemic—7 points higher than in November 2020. What’s more, 42% say they’re watching a lot more TV now than pre-pandemic, also up considerably compared to last year.

In last year’s pandemic studies, Hub found that with more time to spend at home, many TV consumers took the opportunity to tinker with their DIY TV bundles—adding some services and dropping others. As the pandemic has dragged on, the percent making changes has continued to climb. 44% of all TV consumers added at least one TV service during the pandemic, a full 10 points higher than in November. At the same time, 25% have dropped a service—a proportion that has also been increasing since last summer.

The TV subscription most likely to have fallen into the “dropped” category is traditional pay-TV service (cable, satellite, or telco). Consistent with Q4 2020 reports from industry analysts, 62% of TV consumers subscribe to traditional pay-TV service, down 9 points since just last November. The use of live TV streaming services (VMVPDs) has grown slightly since the beginning of the pandemic, making up for some of the loss in traditional pay-TV subscriptions.

Viewing TV content via streaming has become more strongly entrenched over the course of the pandemic. For example, subscription to the five most popular streaming services has continued to climb since pre-Covid, with HBO Max up dramatically since November. As Hub has seen in other research, HBO Max has benefitted strongly from the decision to stream all 2021 Warner Brothers movies on the day of theatrical release—including the release of Wonder Woman 1984 last December.

Free, ad-supported streaming services (AVODs) have also shown impressive growth since the pandemic began. The proportion using any AVOD has increased more than 20 points since before the pandemic, thanks in no small part to the launch of the free version of Peacock. Moreover, the proportion of consumers who have purchased a first-run movie on streaming has been increasing steadily since last summer, kick-started with the streaming release of Mulan in September. Younger consumers are the most likely to have streamed a first-run movie, with 18-24 the age sweet spot. Once one hits 55 years old, interest in buying first-run films to stream is almost nonexistent.

Half of Americans (51%) now believe that we’re closer to the end of the pandemic than the beginning—the inverse of what we found back in July. What will happen to their TV services once the pandemic situation has eased? Among those who have added a TV service during the pandemic, post-Covid loyalty is strongest for Disney+ (77% of those who signed on since Covid say they’ll keep it; only 7% say they’ll drop) and Netflix (73% vs. 4%). Likelihood to keep is a bit lower for HBO Max, with 63% who added the service saying they’ll keep it and 17% saying they’ll cancel—a possible sign that the strategy of focusing on first-run movie releases could be both a blessing (surges in sign-ups when movies are released) and a curse (cancellations once they’ve finished watching). And in a related finding, 89% of February respondents who canceled their traditional pay-TV service say they would have canceled even if Covid hadn’t happened—the highest proportion we’ve seen during the pandemic, by far.