Highlighting expected challenges, opportunities and impacts

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The TV ecosystem, like all industries, will be acutely impacted by the COVID-19 outbreak. Although content owners, distributors, agencies, and marketers will all face challenges, considerable opportunities will emerge. Social distancing could boost overall U.S. TV viewership by as much as 60%. Over-the-top (OTT) and connected TV (CTV) platforms stand to benefit from the expected increase in impressions and supply. They are best positioned to support new viewing habits as people turn to aspirational lifestyle, personal fitness, cooking and co-viewing content to cope with the “new normal” and to compensate for the lack of live sports and entertainment events on linear television.

Historical comparisons offer clues

+45% TV usage time in New York following the 2016 blizzard

Americans already spend almost 12 hours a day with media, much of it consuming video, and historical examples show that this number will only go up. Nielsen notes that widespread work from home and coronavirus-related isolation policies could boost overall U.S. TV viewership by as much as 60%. The viewership boon will boost impression supply but will be largely offset by the lack of high-profile live sports and events across linear TV.

-65% primetime ratings for ESPN vs. prior year

Streaming services push for the upper hand

Subscription Video on Demand (SVOD) and Ad-Supported Video on Demand (AVOD) services will capitalize as consumers seek out feature films, general format programming and co-viewing environments. Streaming services are already pushing for the upper hand in the highly competitive streaming wars, with Disney+ releasing Frozen 2 three months early. Aggregators like Roku, which noted a 20% jump in Roku Channel movie viewership, are reacting by adding family-friendly and wellness programming.

The shift away from linear TV accelerates

-12% CTV app CPMs on average for March vs. February, based on limited data

COVID-19 presents unique challenges to the U.S. TV ecosystem, which was approaching an inflection point before the pandemic burst onto the global scene in early 2020. With live sports off the menu, OTT/CTV platforms are uniquely positioned to benefit from the shift in viewing habits, the expected impression and supply glut, and the headwinds faced by traditional TV networks. Longer-term impacts remain to be seen, and depend on numerous factors including the timing and pace of economic slowdown and recovery.

Read Kepler’s full POV on the impact of COVID-19 on the TV ecosystem here, including comparative historical data points, detail on the industry shift from linear TV to OTT/CTV, the effects of these trends on digital media performance, and the trustworthy data sources used to inform our POV.

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Link to full POV, written March 2020