Guest Blog: Millennials Are Watching TV, You Just Aren’t Counting Them

It’s true that millennials are leading the cord-cutting charge. It’s also true that millennials are very much in love with TV. Reconciling these two realities has been a challenge for the television business because revenue is tied to an outdated rating metric that discounts the demographic advertisers care most about.

But before we declare the television business dead, we need a precise count of millennial viewers and a better understanding of how they consume television content.

How are millennials watching?

In one sense, millennials aren’t novel at all. Like the generations that came before them, millennials are now a substantial part of the coveted 18-34 demographic. But what is exciting—and at times unnerving—about millennials is that they offer a glimpse into a future where a combination of streaming, VOD, and DVR viewing greatly diminishes the popularity and significance of live television. And because they’re young enough to comfortably navigate the technology that is transforming television consumption, they’re pioneering new viewing habits.

More than any other cohort, millennials watch television further out from the original date of air. Or put another way, millennials are the least tethered to live television. While viewers 35-49 watch a combined 77 percent of their content within the live-plus-7 window, millennials view closer to two-thirds of their content within that same window. That generational gap is significant, but the real trend emerges when you consider the strong millennial preference for streaming content. Compared to Generation X, which views about 12% of its content via OTT, millennials stream about a quarter of their content. Furthermore, there is significant millennial viewership as far out as live-plus-35 for some shows, a fact that indicates a long-term trend toward viewing patterns that place little or no significance on the original broadcast date.

For the moment, the net result for the television business is that the most valuable demographic is increasingly watching television content in ways that the current ratings window fails to capture. As a result, many television companies are stuck in a perverse trap where viewership may be on the rise, but revenue is falling.

What are millennials watching?

Broadly speaking, millennials have a strong preference for streaming originals. For viewers 18-24, four of the top five shows are streaming originals. As the audience skews older, streaming originals drop somewhat in popularity. Among viewers 25-34, two of the top five shows are streaming originals. By comparison, only one of the top five shows for those in 35-49 demographic was a streaming original.

While this is certainly good news for Netflix and Amazon, it’s important to note that there’s nothing unique about streaming content that speaks to millennials. Netflix reaches only about 45 million members in the U.S., a fraction of the nation’s 124 million households. At the same time Netflix is exceedingly popular with, and important to, millennials. So it’s no surprise that Marvel’s Jessica Jones and Master of None perform so well with this demographic.

What may surprise some is that broadcast shows are also popular with millennial audiences. Fox and the CW, two networks that skew younger, consistently rank in the top ten for millennials with shows like Bob’s Burgers, Family Guy, The Flash, and Arrow. Looking at the older millennial cohort, 25-34, ABC shows like Modern Family and Grey’s Anatomy perform well. But the real story is the fact that only one Fox show, Empire, and no CW shows rank in the top ten for Generation X viewers, who favor CBS and ABC. Meanwhile, only one Netflix original,Making a Murderer, appeared in the top ten for that demographic, and of course, it’s important to note that the vast majority of the audience (19 million viewers) for that true crime documentary arrived in the live-plus-35-day.

What this means is that, contrary to the prevailing perception, broadcasters and streaming companies are equally capable of producing shows that appeal to millennials. But it’s important to remember that those shows are also the most likely to be time-shifted out of the current live-plus-7 window. And for broadcasters, that time-shift also means that their audience is increasingly finding them on Hulu, which has a better user experience than network apps and offers current seasons, unlike Amazon and Netflix. To be sure, millennials are driving a tectonic shift in the television business, but they’re not quitting television content, and so television companies shouldn’t give up on counting them.