Despite Cord Cutting, TV Dominates Advertising

MediaDailyNews by Wayne Friedman, Feb 21, 2013, 12:57 PM Pay-TV cord cutting will be minimal over the next several years. And while traditional TV viewership is in decline, TV will easily remain the most dominant platform for advertisers in years to come. "Even though some consumers are cutting the cord, reducing their subscriptions, or not subscribing when starting a new home, the impact to the pay TV industry over at least the next five years will be minimal," says PwC's Cord Cutting and the Second Screen report. PwC says there are multiple concerns about cord cutting, "cord trimming" and those who will never "cord" -- young viewers who never becoming pay TV subscribers. Still, TV will continue to have major sway. The company notes that TV advertising influences on those 18+ are 37% compared with newspapers at 11%; Internet; 6%; and mobile, 4%. Other research, from eMarketer, says TV remains the dominant platform for advertising at 39% market share versus 22% for the Internet. "While consumers are spending more of their media time on mobile and Internet-enabled devices, TV viewership remains strong... certain comedy and drama content, live sports, reality TV, award ceremonies, and other exclusive content remain largely real-time programming not conducive to time shifting," notes PwC. It also cites TV as a "communal activity that cannot easily be replaced." Still, estimates are that there will be a 0.9% TV viewership decline annually through 2017 due to increased online consumption of TV programming. Screen-screen activity continues to grow. For example, Internet-protocol TV (IPTV) ownership doubled in one year to 10.4% penetration in 2011 from 4.7% in 2010. PwC says almost half of American households own gaming consoles -- which are Internet-capable and can be used to stream TV content through multiple OTT options. Some 36 million Americans report watching video content on their mobile phones. Smartphone sales are forecast to grow to $141 billion by 2016 from $79 billion in 2011; and tablet sales are projected to grow to $100 million by 2016 from $28 billion in 2011.