Wednesday, June 24, 2015

TV Ratings Stink Because People Are Watching More TV

Earlier today, the Bureau of Labor Statistics released the 2014 data for their annual American Time Use Survey. The survey measures how Americans spend their time, from working to sleeping to leisure. In an environment where TV ratings declined 50% in the decade following 2002 while subscription fees have steadily increased to make up for lost advertising revenue, surely we would see a similar decline of television viewership in the survey data.

Well now, that's rather curious, isn't it?

These are average hours per person, which means that even if the graph were flat, the total number of hours watched would have increased due to population growth; U.S. population increased from 290 million in 2003 to 319 million in 2014.

To be fair, the 50% figure is for broadcast networks, but the disparity is striking and undeniable, raising a number of questions. Are Nielsen ratings are flawed? Are we merely watching more cable? Is everyone just streaming Netflix? Whatever the reasons, and there are many to be sure, the majority of television consumption is now unaccounted for by traditional metrics. For all the complaining from studio, network, and advertising executives about declines in viewership, it seems the actual problem lies with their inability to measure and monetize what is actually a growth in TV watching.