Prime Time is Dead

There, I said it.

Earlier this week, this thought struck me when two particular articles hit the news cycle.

The first was a piece about an ongoing dispute between two powerhouse figures. No, I am not referring to the Trump v. Pelosi government shutdown. I am referring to the CBS and Nielsen showdown which lasted two weeks.

Why is that important you may ask? Nielsen is a household name for anyone in media especially the broadcasters ABC, CBS, FOX and NBC. Nielsen is a market research firm specializing in measuring viewership, audience fragmentation and content consumption.

In layman terms, Nielsen keeps track of when and what I watch on TV and then sells my data back to the Big Four broadcasting giants. The Big Four then use the data for a variety of purposes but primarily for selling advertising slots for their programming.

Unsurprisingly, the price of advertising will vary based upon the time of day. Advertising sold in the middle of the day is more affordable than advertising sold for "prime time" - i.e. the time period between 8PM ET and 11PM ET on Monday through Friday. For those slots, networks charge a premium because they know more audiences are tuning in now or in three days when the programming will be available to watch on demand (C3 VOD).

Fun fact - ever wonder why you cannot fast forward through those dreaded commercials when you watch on demand content? This is the reason. Broadcasters consider viewing within three days of air dates comparable to the air date itself and therefore you are subjected to those commercials.

Let's take a look at the top prime time shows reported by Nielsen the week of January 7, 2019. The data below includes the weekends.

1. Fox NFC Playoff-Sat

2. Fox NFC Playoff-Kick-Sat

3. Fox NFC Playoff-PST Sun

4. The Big Bang Theory

5. NCIS

6. Young Sheldon

7. AGT Champions

8. Mom

9. Blue Bloods

10. Chicago Med

Courtesy of Nielsen Ratings, Week of Jan. 7, 2019

Comment below if you watched any of these top 10 shows from January 7 - I did not. In fact, I struggled to recall the last time I watched a show "live" (i.e. with commercials and during its designated air date). Super Bowl? Maybe the spring of 2018? And I point this out because it's an important trend.

Me and my cohort of Millennials simply do not watch as much prime time as previous generations. This assertion was confirmed in November 2018, when Adage reported that broadcasters noticed a 22% decline in adults aged 18-49 watching prime time. The Advertising Research Foundation (ARF) also published a similar report in March 2018 claiming that Millennials have very different TV viewing habits than older adults. A few highlights from their research -

• Millennials tend to watch "prime time" programs outside of the air date or C3 (three days from air date) than adults between the age of 35-54

• Younger Millennials top five programs were streaming originals (i.e. shows that did not air on a broadcast network)

• Nearly one third of Millennials are cord shavers or cord cutters

Now that you have the background - back to Nielsen and CBS. Why did this article catch my eye? Because Nielsen finds themselves between a rock and a hard place. Several of the Big Four programmers have been critical or downright suspicious of the measurements provided by Nielsen.

In 2016, NBCU, then the number 1 broadcaster, blasted Nielsen with assertions that their data was "bad, inaccurate and misleading." In particular, NBCU was angry that the data Nielsen provided (and which they and others pay handsomely for - reports surfaced that the newly minted 2019 CBS-Nielsen deal is worth $100M…annually) did not include "out of home viewing" (i.e. on a mobile device) and did not differentiate programming watched at home on the broadcaster channel or on digital mediums like YouTube (which they cannot control advertising slots for).

As I have mentioned before, in this decade, data is king. Many corporations claim they want to make "data driven decisions" on who they sell advertising slots to and measuring the popularity of their shows is critical.

And that is why CBS held out for two weeks on reaching a deal with Nielsen - during football playoff season. For them, it was a foregone conclusion what shows would be number 1 on their network at the beginning of the year (football) and many of their popular shows (i.e. The Big Bang Theory) were still on hiatus. It was a perfect opportunity to exploit Nielsen for better financial terms.

Now with CBS wrapped up, Nielsen's troubles are over, right? No, far from it actually - in my opinion. Why? Over the top (OTT) and subscription on demand (SVOD) services - companies like Netflix, YouTube, Hulu and Amazon - their content was left off of Nielsen until 2017-2018.

Yes, you read that correctly. Nielsen largely discounted or was unable to reach deals with the platforms that millennials and Gen Z regularly watch until recently (i.e. last 24 months). A large reason is Nielsen did not have a syndicated tool to measure streaming based content (it was developed and released in 2017).

I do not blame OTT/SVOD services - given the unreliability of Nielsen reporting prior to 2017, I would not want an organization reporting out on my viewership when it could adversely impact stock price. Or for services (i.e. Hulu) that want to pursue digital ad insertion (DAI) - where relevant and pertinent ads are inserted into shows you watch on demand. So, expect to see more clashes between Nielsen, broadcasters and OTT/SVODs in the future.

Side note - Nielsen does not have a monopoly on show ratings. In fact, they have many competitors like Comscore, Inscape, Kantar who claim to measure new metrics like emotional resonance and second to second viewership data.

One avenue I already see dispute brewing is show popularity. In three to four months (some of the most dreaded days for TV production companies), fates will be decided. Specifically, networks decide which shows will be renewed or cancelled. And one of the measurements that drive that decision - Nielsen ratings.

Except that, again, this measurement is being called into question. Is the number of people that tuned in at a specific time really the correct way to measure "popularity?" That's a question The New York Times tackled this week after the cancelled TV show 'You' exploded on Netflix.

The show premiered last fall on Lifetime and based upon abysmal ratings, it was cancelled. In normal times, it would have faded into oblivion but we do not live in normal times. Less than four weeks later - the show headed to Netflix and fast forward another four weeks, it had been watched by 40M households (including yours truly). Oh and a second season had been ordered by Netflix.

Quick note - I recently wrote a blog about Netflix and their content challenges I 2019. Read it here!

You may argue this is a one-off occurrence - i.e. sometimes great shows get cancelled. Or that Lifetime is not a major network and therefore below average ratings are expected. However, let me remind you that Lifetime just had a massive, ratings breaking show called "Surviving R. Kelly" with 1.9M total viewers.

This is not a one off. "You" is not the first show to get a second life on Netflix. Since Netflix began putting out original content - a part of its strategy has been targeting popular shows that were previously cancelled by networks. Here are just a few to jog your memory --

Arrested Development

Previous Network - Fox

Fuller House

Previous Network - ABC

Gilmore Girls

Previous Network - CW

Queer Eye

Previous Network - Bravo

In fact, I would say this provides indisputable proof that measurement tools used in the past have no place in 2019. So, I raise the question again - how relevant is time boxed watching and reporting in 2019?