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Executive Report - By Thomas Baekdal - March 2015

The Demise of Old TV

The trend of the connected world is finally catching up with the old world of TV. For years, we have been talking about the trend of cord-cutters, on-demand, and a shift in ad budgets. For years, we have been predicting that this would lead to a shift in TV usage, and the 'death' of old TV. But, old TV still held strong and was even growing. As such we had two trends.

One trend was a slow but steady increase in what is known as SVOD, or Subscription-based Video On Demand services, like Netflix, Hulu, but also YouTube and web video in general. And while the trend for these are crystal clear, they still had a very long way to go before they could challenge the old world of TV.

At the same time, we have another trend of a slow but steady growth in TV viewership. Yes, old TV was growing, not declining as you would expect.

To put this into perspective, here is how people watched the USA vs Germany during the World Cup, often mentioned as an example of how digital streaming is the future. Yes, a lot of people watched it online, but old TV still rules supreme (and quite a lot of people didn't watch it at all).

So, for years, we have had a bit of a dilemma as analysts. Both trends were real. People were both cutting cable, and watching more old TV. And we could see a positive movements in both trends.

It's cases like these where we have to look at things in a different way. First of all, we need to look at it from a real-time case of what's important right now. For instance, if you are brand planning to run your next advertising campaign, neither of these trends makes any difference whatsoever. You need to be where your audience is, and if that is on TV... well, that's brilliant. Go for it.

But we also need to look at the future perspective. We can't have two completely opposite trends both growing forever. One has to fail at some point. And from this perspective, the future seems pretty obvious. Old style TV, where you have to wait for something to show up on a specific channel at a specific time and day, doesn't stand much of a chance. The future clearly belongs to time-shifted, on-demand, subscription based TV.

Or simplified, the old form of TV is dead. It just doesn't know it yet.

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Thomas Baekdal

Founder, media analyst, author, and publisher. Follow on Twitter

"Thomas Baekdal is one of Scandinavia's most sought-after experts in the digitization of media companies. He has made ​​himself known for his analysis of how digitization has changed the way we consume media."
Swedish business magazine, Resumé


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