How the Pandemic Will Change Media
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Jon Giegengack: COVID has changed everything about people's lives in general, and probably the change to entertainment is even more dramatic even than lots of other things. So I thought we'd start off with some findings from one of the recent COVID studies that we've done.
We've done several different studies on COVID, and I'm going to show findings that are mostly from a study that we did back in June, just to see how the enforcement of lockdown, the change in people's everyday habits are impacting the way that they consume entertainment of all kinds, but especially video entertainment. And one of the things that we have found in this probably isn't going to be a surprise is that people are using a lot more TV providers than they had been before. COVID. So every April--and, in fact, in every survey--we ask people to tell us all the different TV platforms that they use. And then one of the things that we do on the back end is to figure out what's the per capita number per person that they're seeing.
So in April, 2020, we found that the average person was using 4.8 different TV providers. So that could be a cable that could be a virtual MVPD. It could be any of the streaming platforms. It could be direct-to-consumer or free ad streaming. It could even be an antenna. But the number of those platforms was already climbing back in 2018. But you can see that the number really accelerated 30% just from April of last year. And so people are using more platforms in general, as new ones like Disney+ or HBO Max come out. But the pandemic has really turbocharged that. So one thing that we found is that the number of providers being used is even higher among people who are the most impacted by the pandemic. So among people who say they are strictly social distancing, they don't leave their house for anything except the necessities--those people are using on average 5.3 different TV providers. And among those who have had kids at home, with school canceled because of the pandemic, it's the highest of all. So they're using up to seven different TV sources just within one house.
What we're finding is that the pandemic is creating conditions that even in normal times are associated with a shift in TV providers. So it's really hard to get people to change their habits when it comes to anything, but especially with regards to TV. But the pandemic is creating conditions where those habits do, actually. And there's the opportunity for a change in how they watch TV to occur. For one example, the pandemic is causing people to move. So in June, among those who have moved in the past year, a third of them said that the pandemic had a lot to do with our decision to move. And another 22% said it had a little something to do with it. But, in general, when people move TV providers, one of the things that they change--especially these days--is that traditional pay TV is more likely to be swapped out for something online.
And when we ask people who said they had cut their cable or pay TV cord since the pandemic began, 25% said that if not for the pandemic, they would not have cut their pay TV subscription. About half of people who said they had cut it said they would have done that anyway. So it certainly doesn't account for all of it. But with pay TV churn being such a big, important factor in changing the industry today, the fact that a quarter of those people are being accelerated, being pushed through by the pandemic. It's a really important finding. It's a trend that's happening anyway, but again, the pandemic is turbocharging it.
Finally, the pandemic is creating a lot of interest among people in trying a lot of these new providers that are out there. As we all know, there were a ton of new providers to choose from already before the pandemic even began. But now, the pandemic is creating time to fill. There's a big vacuum, and people are filling that, in many cases, by sampling some of these new providers that maybe they wouldn't have otherwise. So since the pandemic began in March, 28% of people say they've added at least one new TV service since that started, which is a lot higher than we normally see for that period of time.
One big change--and this has gotten lots of attention in the news--is something we've been following as well: the willingness of people to pay to get content at home that they might otherwise have gone to a theater to see. Now the theaters are closed. 75% of our respondents said they were at least somewhat interested in paying a premium. So as much or more as they would have had to pay to see it in the theater to see theatrical movies released at home, in lieu of being at a theater.
Again, it's even higher among people who have kids at home because of the pandemic. There's a 20-percentage-point difference between them and the folks who don't have it, who don't have kids at home.
And really interestingly, people who expect their income to drop because of the pandemic--one might assume that they would actually be less likely to spend on things like premium video or be less likely to add a new TV service. But, in fact, the reverse is true. People who expect their income to drop are more likely to say they're interested in paying to see some premium content at home. They're also more likely to say that they've added a new platform. And this is part of a really interesting finding that we're looking into is that people actually look at TV, not as a luxury, but almost as part of an austerity package where maybe they know they're going to be spending more time at home and they're investing more money to make that palatable. So it suggests that, as we work our way through the recession driven by this pandemic, that TV might be a lot more resilient than a lot of other types of industries.
So, just to sum up, some of the biggest things that we've seen: One is that people are using more platforms since the pandemic has started, which means there's a greater need for aggregation platforms that can kind of help them manage all that content from one place. It's also created new content habits to serve. So things like people's willingness to pay for theatrical releases at home. And it's accelerated a shift from retail to digital. So we've seen many, many more people who used to only buy a video, or you only used to buy video games. For example, at retail stores now investing in hard drives and creating new behaviors where they're downloading that stuff to store it digitally, which is a habit that they're going to keep when this all is over.
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