The Communication Markets and Companies Research Group (GIMEC) of the Faculty of Communication of the University of Navarra has presented a study entitled "Identification of the reasons for consumption of fiction and entertainment audiovisual content in the Spanish market". Its conclusions have been grouped in the following decalogue, ten keys to understanding the consumption of audiovisual content in Spain:
1. CHANGES IN AUDIOVISUAL CONSUMPTION PATTERNS: Linear television consumption is decreasing while online and mobile viewing is growing at any time of the day, both in prime time and day time. Although the time of greatest online audiovisual consumption coincides with traditional prime time television, the rest of the day is full of micro-moments that are ideal for content viewing. Audiences recognise that they watch less conventional television due to the time dedicated to online content. Therefore, the audiovisual services on demand compete directly with linear TV for viewers' time. Audience measurement systems are undergoing a transformation process to better adapt to new audiovisual consumption patterns in a multi-device environment, thus improving the reliability of their data.
The fact: Since 2012, when linear television consumption reached a record high of 246 minutes on average per person per day, there has been a steady decline, reaching 216 minutes in 2018 (excluding guests), a figure similar to that of 15 years ago, when the television offer was very limited. On the other hand, 63.4% of users recognise that they watch less conventional television because of the time dedicated to online viewing (Source: Kantar media; GIMEC online questionnaire).
2. GENERATION GAP: There is a flight of young audiences from linear television to other more customisable and interactive audiovisual platforms. The younger the audience, the fewer minutes they consume. The audience profile of most traditional generalist TV channels is ageing and the affinity of young targets with them is low. Moreover, there is no evidence of a boomerang effect, i.e. that today's young audience will return to television as they get older. It does not seem that the trend in audiovisual consumption will reverse. If this consumption pattern continues, it is to be expected that older audiences will, in the near future, consume content in a very different way to the way older people do today.
The fact: Millennial audiences watched almost one and a half hours less linear TV per day in 2018 than the general audience, i.e. 134 minutes. In addition, 1 in 3 (almost 75%) admit to watching less TV because of time spent online. In terms of the profile of the youngest audience analysed (14-24 years old), almost 98% recognise that they regularly watch online content.. Less than 20% of the audience of the Mediaset and Atresmedia channels as a whole belongs to this target; and in the case of the main channel of the public operator (La 1), around 45% of its audience are people aged 65 and over (Source: GIMEC Cuestionario Online, 2016; Kantar Media).
3. CONTENTS AND DEVICES: In the context of multiplatform television, fiction (films and series) stands out as the most watched online content, and the computer as the most used device, followed by the smartphone. Although there is no direct relationship between the type of content viewed and the device used, we can conclude that the more attention required to follow a piece of content, the larger the screen size used. Smaller devices tend to be used instead for content that can be viewed in a fragmented and moving manner.
The fact: Around 90% of users use a computer to watch online content, and almost 74% use a smartphone. Nearly 60% of respondents admit to using smart TVs as traditional TVs without taking advantage of the Internet connection. This is supported by the time-shifted viewing figures provided by Kantar Media, with only 6 minutes of on-demand viewing per day consumed on smart TVs in 2018. Films (88.3%) and foreign-produced series (74.3%) are the preferred genres, in addition to the "other" category (82.8%), which encompasses very diverse content such as YouTube videos or music clips (Source: GIMEC Online Questionnaire, 2016).
4. INTERACTIVITY: The use of second screens while viewing content is a widespread practice, which reduces the quality of media attention. At the same time, interactivity boosts audience engagement and the viewing of content at the time of broadcast. For this purpose, users mainly use smartphones. The second screen is always smaller than the main screen. Only when the main device is a tablet, the audience acknowledges that they do not use a second screen preferentially. The interest in interacting with other people is the main reason behind the use of second screens, especially through messaging applications such as Whatsapp and social networks. Although technology has evolved dramatically in recent decades, the needs that people need to satisfy through media have not changed substantially, as one of the main motivations is to strengthen interpersonal ties.
The fact: More than 60% of users regularly use a second screen when viewing online content. They admit to doing so always or often (GIMEC Online Questionnaire, 2016).
5. AUDIOVISUAL MARKET AND SUPPLY: The audiovisual offer has multiplied and audiences have fragmented. However, there is a trend towards concentration and globalisation of audiovisual entertainment companies. In addition to linear television channels, there have been catch-up TV services from the traditional operators themselves (with the consolidation between 2011 and 2013 of platforms such as RTVE a la carta, Atresplayer and Mitele), convergent packages from telecommunications companies with audiovisual services, and numerous video-on-demand platforms such as Netflix, HBO, Amazon Prime Video and Sky, among others, whose boom in Spain began in 2015. All this has led to a continuous increase in investment in television programming globally, although it has stagnated in large markets such as North America and Western Europe. We can speak of a situation of audiovisual oversupply driven by OTT platforms, which have boosted phenomena such as binge watching. Thus, they have radically changed the way of programming and consuming serialised products, moving from the release of individual episodes with a certain periodicity (in the style of traditional television) to the simultaneous release of complete seasons. The system of marketing by windows and markets has also been weakened, as these services tend to release their content on their platform at the same time in all countries worldwide. This practice implies a decisive change in the management of audiovisual rights.
The fact: In 2017, $145 billion was invested in television programming globally, of which $13 billion was invested in two of the leading OTT platforms: Netflix and Amazon Prime Video (Source: MipTV-mipcom, 2018).
6. AUDIOVISUAL INDUSTRY AND PRODUCTION: Increased investment in television programming translates into increased audiovisual production activity. New audiovisual services become potential clients for producers, who are no longer only dependent on traditional television operators. Although the large audiovisual production and distribution companies concentrate a large part of the productions, opportunities also arise for local producers, who can offer their content directly to international platforms with a global audience and without the need to resort to distributors for each market. In this context, the figure of the showrunner, a scriptwriter-executive producer who is at the heart of the creative-industrial process, is gaining importance. In addition, new producers of audiovisual content for the internet (Youtubers/influencers) are emerging, who establish a strong link with their followers. Their trust in them makes them powerful prescribers, and therefore relevant agents for brands (advertisers) and their advertising investments. The proliferation of producers with this profile has in turn led to the emergence of a new intermediary agent dedicated to content management and representation, the Multichannel Networks (MCN).
The fact: Most of the budgets for the new services of video on demand is not spent on original content, but on acquiring content already produced. For example, Netflix spends almost three quarters of its budget on buying other people's content, and Amazon 90%. Of the investment in original production, most goes to fiction, and increasingly to entertainment programmes, especially content classified as factual. For example, in 2017, Netflix released 84 non-scripted entertainment titles produced in-house (Source: MipTV-mipcom, 2018).
7. BUSINESS MODELPay-per-subscription TV model is growing, while pay-per-view is decreasing, surpassing free-to-air TV in terms of revenue. There is evidence of an increase in the consumption of pay TV content in Spain, including among the youngest sector of the population. At the same time, the decrease in linear television consumption has not been accompanied by a proportional reduction in advertising revenues, although a stagnation can be observed, a circumstance which has also been influenced by external factors related to the economic context. Nevertheless, television continues to stand out as the destination of most media advertising investment. The large private television operators account for almost all television advertising revenues.
The fact: In 2017, pay-TV (€2,152.69m) overtook free-to-air TV advertising revenues (€1,831.43m), a trend that started a year earlier. In any case, of the 5,355 million of advertising investment in media, 40% went to television. And 85% of this figure is earned by Mediaset España and Atresmedia. One in three households pays to watch content (around 35%), accumulating an audience of close to 20 million viewers (Source: CNMC, 2018).
8. PERCEPTION OF QUALITY: The ability to entertain is the quality that audiences most associate with quality television. The determining factor on which audience gratification depends above all is the quality of the content itself, over and above other factors such as the quantity of the offer or technical issues. The perceived quality of television has not changed substantially in recent years, despite the growth in choice and technological improvements. The perceived quality of news programmes is the one that has the most decisive effect on the audience's assessment of television channels. With regard to fiction series, the aspects that most influence the perception of quality are the dialogue, the plots, the characters and the actors. In the case of entertainment programmes, the presenters and the sets stand out. In the case of both fiction and entertainment television, the artistic staff occupies a decisive place in the perception of quality, revealing the existence of a certain star system in Spanish television.
The fact: The perception of TV quality in Spain fell from 3.32 out of 5 in 2008 to 3.17 in 2016. The figures vary according to the educational level and age of the audience. For example, in 2016, perceived quality was 3.35 out of 5 for those with only primary education, but dropped to 3.14 for those with secondary education, 2.92 if they had a diploma and 2.82 if they had managed to complete a university degree. In the same year, those aged 65 and over gave a score of 3.34 out of 5 for television quality, while those aged 25-44 - the least satisfied age group - gave a score of 2.86 (Source: GIMEC, Telephone survey).
9. TECHNOLOGICAL INNOVATION AND TELEVISION: Technology stands out as a disruptive and decisive factor in the configuration of the new audiovisual entertainment model. Thus, the application of Artificial Intelligence and Big Data are key to improving the personalisation of services, user experience and accessibility of content. However, users do not yet perceive the automatic recommendations of these systems to be fully satisfactory, as they show greater trust in personal recommendations. Automatic recommendations are more effective when the catalogue of content is extensive and the user is loyal to the platform. In any case, algorithm-based recommendations are proving to be a powerful marketing strategy. In the near future, Augmented Reality and Virtual Reality will also play an important role in television, as is already beginning to happen in other sectors such as video games and e-sports.
10. CHALLENGES FACING THE TELEVISION SECTOR: Television operators are immersed in a process of strategic reconversion and redefinition of their offer, their business model and their identity. They have become global audiovisual entertainment companies with the aim of offering each content on the right screen and reaching each target at the right time and on the right device. They are also facing major uncertainties due to the emergence of technological giants in the audiovisual sector such as Apple, Google, Facebook and Amazon. In this context, traditional television operators have begun to develop integration strategies and alliances, creating joint platforms to compete from a position of greater strength with the new players. For example, this is the case in Spain with the "Loves" TV service. The exhaustive knowledge of the audience stands out as a key factor to guarantee the success of audiovisual products, and one of the main axes on which the activity developed by television companies must pivot. In any case, and despite the revolution that the sector is undergoing, television retains an outstanding position and influence in the media landscape. It continues to be the familiar medium of reference in the multiscreen ecosystem of which it forms part, especially relevant in the case of live content-events.