TV Online May Not Lead to Watching More

A new study investigates how the television experience may change as online viewing becomes more widespread.

Researchers from the University of Texas at Dallas discovered online television does not influence the amount of time a person spends viewing TV, but it does make the experience more pleasurable.

“Some media reports predict that because people now have access to watch anything they want, anytime they want, they will spend more time watching TV,” said Dr. Stan Liebowitz, a managerial economics professor and one of the study’s authors.

For their research, Liebowitz and Dr. Alejandro Zentner examined television consumption during the switch from broadcast TV to cable TV. Because data of current trends in Internet TV viewing won’t be available for another 10 to 15 years, the authors used past history to forecast future experiences.

The study, recently published in the Journal of Cultural Economics, found that viewing time essentially stayed the same, regardless if the variety of available TV shows increased.

Liebowitz said consumers have only 24 hours in a day, so giving them more variety does not mean they’re going to spend more time watching television.

Although they’re not watching more TV, viewers are getting greater enjoyment from watching television via the Internet, according to the study.

“Additional program choices imply that people will be more likely to find a television show that more closely matches their taste,” said Zentner.

The additional program choices should mean a more entertaining and enjoyable experience.

Because the variety of programs doesn’t impact the amount of television consumption, on-demand Internet streaming media companies should not expect to make additional revenues through increased viewing, say the researchers.

Liebowitz said they should focus on subscription revenue like Netflix rather than advertising revenue as Hulu initially did.

And what about binge watching, viewing multiple episodes of a TV show in rapid succession?

“Our results imply that people who are consuming their TV in binges do not change the total time they spend watching TV,” Liebowitz said. “Instead, they’re just changing what content they’re watching.”

The realization that increased variety does not change the amount of television consumption may provide strategic insights for other industries, said Liebowitz.

Consumers have a large number of choices for many products, including movies, candy bars, and cars. These industries might have the same trait as television — that more variety merely shifts consumption toward choices that better fit each consumer’s taste.

Ultimately, the extra choice of watching TV online is positive for viewers.

“Consumers are going to be better off as the option to watch TV via the Internet grows,” Liebowitz said. “If you have more choices, you’re going to be able to find a program that fits what you feel like watching.”

Source: University of Texas, Dallas
Woman watching television photo by shutterstock.