When Streaming Killed the TV Star

Change is the only constant...in the 1950s television replaced radio as the dominant form of entertainment. Then came cable television and HBO in the 1970s. Then it was the internet...and YouTube in 2005. Since then, broadcast television and cable have been losing ground to streaming services like YouTube, Netflix, Hulu, etc.; first slowly and then quite rapidly. The future that was long anticipated finally arrived last month. The New York Times reports that in May, "more Americans watched television on streaming than on cable and network television combined." It was the first time that happened over a full month.

Looking at the chart above, Americans were still consuming entertainment primarily through television even as late as five years ago. But streaming has made rapid strides in recent years. And ironically, it may be due to Boomers. As the NYT notes, "It’s no surprise that younger viewers were the first to jump to streaming. But another group has since made the leap as well: viewers over the age of 65." They are the fastest growing age group for streaming services, according to Nielsen. Older viewers watch a lot of television and are drawn to free platforms like Tubi, Roku, and Pluto. 

If the streaming vs television race is all but over, the winners within streaming are just as clear. Not all streamers are equal...YouTube is the undisputed king of streaming capturing 12.5% of all viewing time in May, followed by Netflix (7.5%) and Disney (5.0%).

What's next for the winners? Well, Ted Sarandos, Co-CEO of Netflix, says "What we really are focused on is the 80 percent of TV watching that is not on Netflix or YouTube today.”

The ascension of streaming as the primary form television consumption reminds us of the change seen in the music industry a few decades ago. On August 1, 1981 MTV (Music Television) went live and swiftly revolutionized the way people experienced music by playing (back then) music videos 24/7. The impact of a new technology on existing media was captured eloquently in the Buggles' icon video "Video Killed the Radio Star" (which was played heavily in the early days of MTV). And its message applies just as much to the next incumbent technology.