Thursday, January 14, 2016

Broadcast Television: How Can They Discount the Netflix Threat?

AdWeek has a startling article about one broadcast network executive's thoughts regarding Netflix. McAlone quotes Alan Wurtzel, NBC's head of research. Wurtzel draws on data from Symphony Advanced Media, which has been trying to assess Netflix viewing habits through various metrics (since Netflix does not disclose viewership on particular shows). Wurtzel says, "The reports of our death have been greatly exaggerated."  AdWeek reports that, "Symphony measured the average audience in the 18-to-49 demographic for each episode within 35 days of a new Netflix series premiere between September and December. During that time, Marvel's Jessica Jones averaged 4.8 million viewers in the demographic, comparable to the 18-to-49 ratings for How to Get Away with Murder and Modern Family." The article goes on to report the following about Wurtzel's views:

Wurtzel said Symphony's data also revealed that most viewers of those SVOD (subscription video on demand) shows return to their old viewing habits by the third week. "[By then], people are watching TV the way that God intended"—that is, via traditional, linear viewing—said Wurtzel. "The impact goes away."  That's because Netflix has "a very different business model—their business model is to make you write a check the next month," said Wurtzel. "I don't believe there's enough stuff on Netflix that is broad enough and consistent enough to affect us in a meaningful way on a consistent basis."

I'm speechless.  How could Wurtzel have his head so far buried in the sand?  Has he spent anytime actually visiting the homes of families with teenagers or interviewing college students?  Does he understand how they consume content?   Compare Wurtzel's view with the information shared in a Business Insider article by Lara O'Reilly

The average Netflix subscriber streams movies and programs for two hours a day, according to estimates from Rich Greenfield, an analyst at BTIG Research.  That's huge.  Not only is that mean average domestic number up around 18 minutes per subscriber per day on BTIG's last estimates, but it is a major benchmark that suggests Netflix is really eating traditional TV's dinner.

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