COVID-19: quickening the pace of change in media
Long-term, structural shifts have accelerated since the pandemic
Consumers adapted much quicker than many companies and the disruption, which was expected to take years to play-out, happened in a few months
The COVID-19 pandemic and resulting lockdown measures caused a significant uptake in streaming services and a rise in digital adoption, and also placed increased pressure on traditional media services. Almost a fifth of households, 19%, say the pandemic has irrevocably changed their TV consumption habits. This trend is even more pronounced among the younger generation of 18-24 year olds, with 23% agreeing their habits have irreversibly changed.
Upsurge in streaming services
Among all households, lockdown measures caused a significant spike in the use of streaming services. Over a third of households – 36% – agree they were using streaming services more often, a figure that rises to 57% for young adults, aged 18-24.
Across the board, there has been an upsurge in the use of streaming services
Used TV streaming services more often as a result of the COVID-19 situation.
In EY's annual Digital household research conducted in October 2019, the average number of content services used in the home was 3.4. During the pandemic, however, this increased by more than 20% to 4.2. The biggest winners in this are global streaming services and also public service broadcasters (PSBs), with broadcaster video on demand (BVoD) from the main two channels increasing.
Rising digital adoption
As households looked to fill the lockdown void with more content options, many consumers turned to catch-up services from broadcasters or other free platforms for the first time. Among all households, 11% tried BVoD services for the very first time. More compelling was the rise in penetration of digital adoption among the older generations, with 15% of over 55s watching PSB streaming services for the first time.
Declining role of traditional media
Despite the crisis and increased interest in news, only 6% of households looked to printed media for news at this critical time, while only a third of households, 34%, believed newspapers coped well with the crisis.
Streaming services used in the home up 20%
4.2Average number of content streaming services used in the home in May 2020 (up from 3.4 in October 2019)
COVID-19: quickening the pace of change in media
Streaming services step up in a crisis
TV streaming became an indispensable service as a result of COVID-19
TV streaming became an indispensable service during COVID-19, with such services consolidating their position in the mainstream mix of media options. Positive sentiment around how well streaming services were coping rose from 66% of respondents at the start of lockdown in March to 70% in May, only to be surpassed by the increase in sentiment towards the NHS which increased from 79% to 86%.
Perception of streaming services increased during the pandemic
Question: How well or badly do you think each of the following are currently coping with the COVID-19 situation?
Streaming services reacted quickly to widen their range of content, taking advantage of blockbuster content originally scheduled for cinema release. As a result, usage of such services went up in 36% of households. Additional demand was also driven by households with children, accounting for 45% of households reporting an increase in usage.
Broadband operators need to consider this positive public perception of streaming services in their messaging and planning. Network reliability and resilience became a significant issue for consumers, but even if buffering occurs, it is the broadband provider that receives consumer criticism and not the streaming provider. A deeper appreciation of this issue will help network providers ensure service consistency and quality of customer experience.
COVID-19: quickening the pace of change in media
PSBs must act urgently or miss the opportunity
Public service broadcasters are coming out of lockdown in a more precarious position
EY research found that lockdown measures increased the consumption of public service content, which was driven largely by consumers’ interest in news. At the start of lockdown, half the population (50%) admitted they were looking at more news content, which has since declined to 46%. Equally, the reliance on PSBs for news has waned, from 40% at the outset to 30%.
At the start of lockdown, confidence in PSBs was high, with 77% of households thinking they were coping well with the situation; yet in May, this figure dropped to 61%.
For PSBs this was a learning experience that accelerated their understanding of their audiences. In order to ensure they do not miss out on the opportunity, PSBs need to urgently translate their learnings into design and execution of their long-term digital strategies and the redefinition of their purpose.
Confidence in PSBs declines
61%now think PSBs are coping well with the situation, declining from 77% at the outset
COVID-19: quickening the pace of change in media
Collaboration across the ecosystem is required to fight fake news
Social media companies, government and regulators all need to take responsibility to tackle fake news
The start of the COVID-19 crisis led to an increase in mistrust, and it has remained high or even increased. EY research in March found that 17% of respondents said they trusted social media less as a result of the pandemic, and by May, this figure was almost the same at 18%. Most significantly, mistrust among younger demographics is on the rise. Twenty-four percent of 18-24 year olds said they mistrusted social media less than before the start of the pandemic, this figure rose to 29% in May.
Fake news is a major part of the issue, from the dissemination of erroneous medical advice to unfounded speculation about the harmful risks of 5G technology. Despite reassurances from the Government, 25% would still be wary about using 5G. Social media companies continue to be consistently regarded as responsible for tackling fake news and, in addition, there is now a growing expectation that the Government needs to step in.
Collaboration is required between platforms, regulators and news providers to successfully combat this issue. Technologies such as blockchain and the deployment of more sophisticated artificial intelligence capabilities offer some insight into how companies can execute, but only if they can do so across the industry at scale. The growth of these channels will be put at risk if audiences and advertisers are alienated as a result of the failure to address it.
Social media mistrust
25%of households remain wary of 5G technology despite government and service provider reassurances
COVID-19: quickening the pace of change in media
Subscription services demonstrate stability
Sports remained an integral part of the pay-TV value proposition during the pandemic, despite the absence of new content
Despite the lack of live sporting content during the pandemic, many subscribers were reluctant to remove sports from their subscription. This highlights the integral role it has within the value proposition of pay-TV in the minds of consumers, so that for many they perceive a subscription without access to sport as far lower value than the cost of the package itself. Only 6% of households claim to have paused their subscription and only 3% have cancelled altogether since the start of the crisis. It’s important to note how resilient this area is at a time when 14% of households wanted to reduce spending on content and communication services during the pandemic.
The return of live sports events, even behind closed doors, could create new opportunities for content services especially with the sharing of some sports like the Premier League among multiple media platforms. In addition, at home viewing figures could remain high for some time as a quarter of sports fans say they will stay away until a vaccine is in widespread circulation.
Similarly, only 22% of respondents claim they will only return to the cinema if a vaccine is in place. This paves the way for premium movies to give a comparable boost to pay-TV services, potentially extending the trend of the straight-to-streaming model.
Sport packages remain robust
6%claim to have paused their subscription to sport during the pandemic, despite the lack of live content
Summary
Consumers changed their behaviour rapidly during the pandemic and, although consumption levels will normalise, it is unlikely they will revert en masse to their previous behaviours. Some service providers responded with agility, but they need to apply the lessons learned across three key areas:
- Actively accelerate transformation plans to remodel and reforecast for the future, with emphasis on behavioural groups and personas, rather than traditional demographic modelling
- Rapidly repurpose the organisation for a different future, by investing in key talents, technologies and opportunities – not just appending the new normal to existing business models
- Understand and implement new content models based on the success of specific genres in consumers’ perception of value, not just on what’s been successful because of the crisis
For details of each, please refer to the detailed EY report (PDF, 433KB).
