The services which consumers have used to watch live TV have been shifting for a number of years, but the switch to streaming services this year has gained significant momentum, with use of free streaming services such as iPlayer or YouTube to watch live TV up from 30% last year to 42%.

COVID-19 has undoubtedly accelerated this shift, with television viewing across all platforms up nearly a third (32%) in April on the same period for 2019, according to Ofcom. Public Service Broadcasters (PSBs) have recorded some high viewing figures for news events during the pandemic, but subscription video-on-demand (SVoD) services such as Netflix, Disney+ and Amazon Prime have been the key beneficiaries. The ongoing effects of COVID-19 will mean a slow return to theatres and cinemas; cinematic releases online first will increase appeal of the streaming services.

In the immediate term, television is well placed to handle the change in personal circumstances which consumers find themselves in as wariness about going out and experiencing social activities such as theatres and cinemas drive consumers to watch content at home first. Post-pandemic, the economic downturn may see consumers switching off from pay-TV services and, to a lesser extent, streaming subscriptions, as the economic downturn bites.

Longer term, television services will likely benefit from the period of lockdown as new habits formed in this period can be sustained. 3m consumers accessed a paid-for streaming service for the first time during lockdown, and this behaviour switch can be maintained as consumers find value in their new service. As consumers increasingly become interested in personal curated content for their interests, opportunities for content-specific streaming services such as sports and documentaries can cater to the diverse needs of the super fan, and would likely see the landscape for streaming content become more segmented according to individual preference.

Key issues covered in this Report

  • The impact of COVID-19 on the television and video market.

  • How consumers’ viewing preferences will change in the short, medium and long term.

  • Opportunities to tailor video and TV offerings to consumers’ changing habits.

  • How a COVID-19 recession will reshape consumers’ attitudes to television and video viewing.

Products covered in this Report

This Report examines television-viewing habits and attitudes of consumers in the UK. This refers to the consumption of video content accessed through the following sources (unless stated otherwise):

Linear broadcasts on digital TV channels (ie conducted at the time of scheduling, via free-to-air or paid-TV providers).

Video-on-demand (VoD) platforms that exist alongside a broadcaster’s/provider’s linear TV service in order to provide access to time-shifted content via the internet (eg BBC iPlayer, Sky Go etc).

Subscription video-on-demand (SVoD) services that require a monthly payment (eg Netflix, Now TV).

Other forms of online video service such as those that allow viewers to purchase individual shows (eg TalkTalk TV Store), or access TV programmes or clips on video-streaming sites (eg YouTube) that are funded by advertising.

COVID-19: market context

This update on the impact that COVID-19 is having on the UK was prepared on 27 August, 2020.

The first COVID-19 cases were confirmed in the UK at the end of January, with a small number of cases in February. The government focused on the ‘contain’ stage of its strategy, with the country continuing to operate much as normal. As the case level rose, the government ordered the closure of non-essential stores on 20 March.

A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. Initially, a three-week time frame was put on the measures, which was extended in mid-April for another three weeks.

On 10 May, 2020, the Prime Minister announced revised guidance, recommending that people who could not work from home should return to the workplace, and giving people more scope to spend time out of the home. Further relaxations to lockdown rules were announced in the week of 23 May, including gradual reopening of non-essential retailers, and increased opportunities for social interaction across households. Hospitality businesses, such as pubs, restaurants and other public places were reopened on 4 July, 2020. On 13 July, 2020, further leisure facilities and beauty services were allowed to open and on 15 July a temporary cut on VAT came into force until 12 January, 2021. From 24 July, it became mandatory to wear face coverings in shops and supermarkets.

Economic and other assumptions

Mintel’s economic assumptions are based on the Office for Budget Responsibility (OBR)’s central scenario included in its July 2020 Fiscal Sustainability Report. The scenario suggests that UK gross domestic product (GDP) could fall by 12.4% in 2020, recovering by 8.7% in 2021, and that unemployment will reach 11.9% by the end of 2020, falling to 8.8% by the end of 2021. The current uncertainty means that there is wide variation on the range of forecasts however, something reflected in the OBR’s own scenarios. In its upside scenario, economic activity returns to pre-COVID-19 levels by Q1 2021. The OBR’s more negative scenario, by contrast, would mean that GDP doesn’t recover until Q3 2024.

We are working on the assumption that a vaccine will be available by mid-2021, but that there will be continued disruption to both domestic and global markets for some time after.

As long as there is not a second wave of infections, social-distancing measures should be gradually relaxed over 2020, but we don’t expect industries such as spectator sports, tourism or foodservice to return to any kind of normality until a vaccine is introduced. In the meantime, the economic disruption will mean that many operators will be forced out of the market, hitting capacity. In markets which were already in decline, we expect this reduction in capacity to be permanent.

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