Technology360

Study: Online video viewing shifting to primetime | #pubmedia

Erick Schonfeld reports on a new Yahoo study that shows the disappearance of a gap in online viewing caused by live TV that was present in 2009. He writes:

... Only two years ago, prime time showed the biggest dip in online video viewing as people turned off their computers and turned on their TVs. But now, more people are streaming TV shows and movies from services like Netflix and Hulu, and they tend to watch those videos during the same time period they previously watched regular TV. ...

Link: TechCrunch.  

Seems that even non-cord-cutters are displacing live TV with online content. Tip of the hat to Steve Bass for the link.  --Dennis

Over-the-air TV households: the real numbers from TVB | #pubmedia

On four different occasions since early 2004, I’ve used information from the Television Bureau of Advertising web site (click “Cable & ADS” on the right navigation) to determine the number of households that use over-the-air reception (OTA) exclusively (that is, not counting antenna reception by secondary and tertiary receivers in wired cable and ADS homes).  The term ADS refers to SMATV, MMDS, large-dish satellite, and DBS, and currently 30.6% of the 30.9% total ADS households are DBS subscribers.

On a tab labeled “ADS and Wired-Cable Penetration by DMA,” you’ll find for May 2011 a table of the 210 Nielsen DMA’s which contains a column labeled “% Cable and/or ADS” (there being a small percentage of homes that have both). If you subtract the numbers in this column from 100, you’ll get the OTA numbers for each market. No need to use some lame telephone survey to estimate this as the Consumer Electronics Association did in December 2010; TVB.org has it for just a little copy/paste work in Excel.

The first time I did this using November 2003 data, OTA-exclusives came up to 19.7M households. My most recent effort prior to this week used September 2006 data, and that showed 14.6M households (13.1% of TVHH). The one I did yesterday showed 11.1M households (9.6% of TVHH).  ADS is now at an all-time high, so the addition of local channels to DBS has resulted in another decline in OTA.

So, yes, it’s falling and, yes, it’s gotten pretty low as a nationwide average.  That’s some higher than the 8% in the CEA’s phone survey mentioned above that’s gotten some circulation (e.g., “Spectrum Reform Now” in The Technology Liberation Front blog).

From a public policy standpoint in a democracy, a national average of doesn’t mean a lot if there is a high “standard deviation” in the numbers that make up the average – and that’s the case here.  There are 535 members of Congress who get to weigh in on what to do with spectrum policy, and when the Boise DMA has 30% OTA usage (antennas exclusively), four members of Congress get to have a vested interest.  Ditto, when Los Angeles has 720,000 antenna-only households (13%), about 30 members of Congress have a vested interest. As L.A. proves, it’s not just rural markets – 15 of the top 50 DMA have 12.5% or greater OTA-exclusive usage. On the other hand, Congress members in New York City, Connecticut and Massachusetts might wonder what the fuss is about.

It’s that political complexity, fueled by the fact that OTA homes have a greater economic impact to stations (especially for public television which has underwriting and individual giving driven by viewing) than do homes with multi-channel programmers – perhaps double the value per household by my own guesstimate.

Don’t get me wrong, I think that freeing up additional wireless spectrum from broadcasters and others – voluntarily and properly compensated – ultimately is a good thing because services on multipurpose devices wireless and wired internet provides will be at least as important to broadcasters in the not too distant future as broadcast spectrum services will be. We broadcasters need it as much as anyone.

But let’s get our data right and make decisions based on understanding complexities, not over-simplifying for political expediency.  Thanks to the TVB for their goldmine of information.  --Dennis

FCC has released its new state of the media report | #pubmedia

The FCC's new state of the media report called, Information Needs of Communities: The Changing Media Landscape in a Broadband Age, is out today and can be accessed here:

http://www.fcc.gov/info-needs-communities

The report's principal author is Steven Waldman, former editor-in-chief of Beliefnet.com, who has served since 2009 as a senior advisor to the FCC on this project.

If you don't want to download the whole 5-mb pdf, you can download smaller ones.  Public broadcasting takes up all of chapter 6 and part of chapter 31.

This will take several hours to review but from a cursory look, seems worth the effort.

--Dennis

Radio station values beginning to eclipse TV’s in #pubmedia; TV spectrum implications

When I was managing public radio and television stations in the Pacific Northwest, I used as a decision-making tool what might be the effect on the imaginary equity value of our organization of this or that significant decision. It tended to move me in a “build” or new product direction, sometimes to the patient consternation of my excellent team. I found it helpful as one of multiple indicators.

Equity values are determined by a lot of things, including market forces largely outside the control of management. We’ve all been concerned about declining television audiences while public radio audiences have continued strong, so I suppose it was inevitable that station equity values in the two media would meet at some point.  There is now evidence we’re there and it has significant implications for the FCC’s effort to free up spectrum for wireless services.

Yesterday, it was announced that Nashville Public Radio has purchased a second station in Nashville for $3.35 million plus full time access to one of its HD Radio channels (congratulations to Rob Gordon, his board and team).  Reports say it will be a classical music station.  Link: Nashville Scene.   In television terms, Nashville is the 29th market with just over 1 million TV households.  It therefore paid $3.22 per household for Vanderbilt’s student-managed station.

In the recent past, we’ve seen the sales of public television stations for $3 million each in Pittsburgh (the 24th market with 1.16M TVHH) and Orlando (the 19th market with 1.45M TVHH).  Pittsburgh’s was not the primary PBS station, but Orlando’s was – and that market had two secondary stations.  So, the Pittsburgh station brought $2.58 per household while, more recently, Orlando’s brought only $2.06.

All of this may lead a gloomy television station exec to look at the possibility of a whole or partial sale to the wireless industry as a good thing.  Perhaps that’s so if you’re sitting on a pile of debt you need to quickly liquidate, but these valuations wouldn’t produce much as an endowment investment. The median of 864 college and university endowment investment returns was –18.1% in 2009 (source: NACUBO). Things are up from there, of course, but even a long term average of +5% seems optimistic these days.  So, if that $3M spectrum sale produces only $150,000 per year and you can’t net better than that with more traditional revenue sources from that spectrum, you’ve got some pretty serious problems.

There are other factors, too, that make a sale to wireless problematic. It’s likely, said the CTIA and CEA in an FCC filling, that they can get all the spectrum they need through repacking and will need to resort to auctioned spectrum only in the top 30 markets (full disclosure: I’m executive director of the Public Television Major Market Group, but the usual disclaimer about these being my own opinions applies). Further, one presumes that the marketability of your spectrum will vary by where you are in the UHF TV band, with a preference for spectrum that can be contiguously aggregated.

--Dennis