Andy Amendola

On the blog last week we talked about “cord-cutters” and the decline of television set sales. Today we explore what this means for the future of viewership and for marketers reaching consumers via this channel.

Despite a decline in TV set sales, Americans are watching more television than ever (Nielsen’s Three Screen Report, 2010). Viewing has moved beyond watching from television sets. The way people consume television today is vastly different than it was five years ago. Consider five key changes:

1. Digital recording devices have allowed for consumers to “time shift.” At the end of 2010, 38% percent of all U.S. TV households had a DVR; however, those viewers are still watching commercials. Nielsen also found that in DVR homes, playback actually improves commercial ratings by 44% among 18-49s after three days.

2. People are watching full-length videos on computers. In Jan. 2011 143.9 million Americans viewed videos online (Source: Nielsen). Furthermore, eMarketer reports that a full third of U.S. adult Internet users watch full-length TV shows online.

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It was just a few months ago when a Forrester research report showed evidence that for the first time ever, the average American spends as much time surfing the web and he or she does surfing channels on TV, at approximately 13 hours per week.

Now a recent Nielsen report is stating that for the first time in 20 years, we are seeing a decline in the number of homes with TV sets.

Nielsen cites three potential causes of this trend: [1] The transition from Analog broadcasting to digital, which has forced people with analog TV’s to either upgrade or buy converter boxes, [2] the recession (no surprise there) and what we consider the most impactful is [3] the growth of multiple platform viewing.

The Time Warner  iPad app allows customers to view live television directly from their iPads.

Although Nielsen has yet to say what factor is causing the majority of the decline, it’s interesting to consider that there is a small but growing number of individuals who ditching their TV sets for their laptops, iPads and even phones. The New York Times has ascribed the term “Cord Cutters” to this group, defined as those “who stop paying for cable television – or people who never signed on for cable.”

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