20.5% of all cable TV households are actively using TV Everywhere (TVE), according to the latest State of Digital Video Report by Adobe Digital Insights (ADI).
This increase in video viewing is spread more evenly across devices than ever before.
In 2015, if a TV provider had to ignore one platform, the video viewing data would have pointed to the TV connected device (TVCD). However, between 2016 and 2017, TVCDs surpassed desktop devices in share of TVE video starts. And, TVCD is the only device type with accelerating year‐over‐year (YoY) growth.
Today, if a TV provider had to deprioritize one platform, the data would point to the desktop browser. However, at 22% of TV Everywhere video starts, the desktop remains a critical screen for digital video distribution.
The streaming TV business is a cross‐device business
For the foreseeable future, streaming TV providers will continue to face the challenge of optimizing their content to mobile devices, TVCDs, and desktop browsers.
There are some pronounced differences between these platforms that add to the challenge.
1. Video junkies are on the move. 24% of TV Everywhere accounts accessed from a smartphone are viewing the majority of the videos from 3 or more locations. So, the heaviest users of smartphone video are consuming content while they are out and about.
2. Millennials are keen on mobile video consumption. 75% of millennials watch TV or movies at least once a month on mobile devices while only 54% of older generations share the same viewing habits.
3. Consumers are very selective on smartphones. Unauthenticated video starts per visit have decreased by 31% on smartphones and 23% on desktop since 2014. This trend clearly illustrates that consumers’ time on a smartphone is very precious, with smartphone users starting 42% fewer videos per visit than desktop viewers.
4. TVCDs lead TVE growth for video starts. TVCDs grew by 349% over the past two years and is the only segment whose growth continues to accelerate. Both mobile (phone / tablet) and browser video starts grew at less than 20% YoY after stronger gains the year before.
5. The cost of TVCD video ads increased at nearly twice the rate of TV spots. CPMs for video ads are growing at a higher rate than the costs of traditional TV, mobile search and display ads. Only the cost of Super Bowl advertising has grown at a higher rate since 2014.
The TV Everywhere model is gaining traction
These video consumption trends favor ad‐supported TVE providers. As consumption increases on TVCDs, these providers will have more ad inventory on the biggest screens in the household. And, as mobile consumption increases, media companies will have more ad inventory on the most personal device that consumers carry with them. Combine that with the fact that the cost of video ads continues to accelerate, and the future looks bright for TVE.