What constitutes “linear TV” and what constitutes streaming? The lines are getting blurred, and that’s made it harder and harder for MoffettNathanson to produce its quarterly “Cord-Cutting Monitor,” the financial house’s three senior analysts conclude.
“Through it all … what went into each bucket was relatively clear. It isn’t anymore,” Craig Moffett, Robert Fishman and Michael Nathanson state.
In an investor note, the three MoffettNathanson analysts note that for each “CCM,” published for more than a decade, they “dig up subscribership and ARPU data from a myriad of sources.” They then “poke and prod” at those numbers “in an effort to make sense of the steady migration of yesterday’s ‘linear TV’ model to tomorrow’s (or, as they note, today’s) streaming one.
Such a task is becoming increasingly difficult to accomplish.
“In the early days, all was clear,” MoffettNathanson’s analysts say in the investor note. “Netflix was streaming. Traditional distributors like Comcast and DirecTV were, well, traditional distributors. When the first vMVPDs arrived on the scene — Sling TV started the ball rolling in February 2015 — they were best understood as simply a digitally-delivered version of the traditional linear video service.”
Meanwhile, Fishman, Moffett and Nathanson back then devoted the bulk of their time to explaining the theory behind what was happening, noting that scripted content was going one way and live another, “with what goes where determined by the unshackling of content from the bottleneck of analog distribution.”
They also say they “spent an inordinate amount of time exploring the ‘why’ behind such evidently poor decision-making by the media conglomerates at the time.”
Things then began to get fuzzy, starting a few years ago.
How should they classify NBCU’s Peacock — is it streaming or linear, simply delivered in a different way? What about Paramount+ or, more recently, FOX One?
Then, there’s the question of what to classify live television on YouTube or Charter’s video service, described as “linear TV with a bunch of free streaming services thrown in” at no cost by MoffettNathanson.
“Increasingly, younger customers think of it as a bunch of streaming services with a live service – what used to be called Cable TV – thrown in for free,” the MoffettNathanson analysts state, pointing to a MVPD deal signed by Optimum with The Walt Disney Co. that gives its subscribers ESPN Unlimited at no additional cost.
“YouTube TV is offering the same. Is that linear… or streaming?” they ask. “With all this as preamble … caveat emptor.”
As MoffettNathanson concludes that “we’re getting close to a floor” when it comes to cord-cutting at Pay TV, they conclude, “We can’t help but feel that we are getting closer to the end of measurability here.”
