A massive new NZ on Air survey reveals how remarkably quickly the migration away from TV has happened – and contains major challenges for business and government, says Duncan Greive. Charts by Harkanwal Singh.
Over the last 10 years we have seen a revolution in our media consumption habits, driven by the ubiquity of smartphones, the rise of social media and the rollout of broadband. Despite the pleasure we take in complaining about their prices (which are still high enough to exclude some), this country has now had relatively cheap and fast and plentiful data, at home and away from it, for years. And it has transformed our behaviour in alternately exciting and confronting ways.
The best evidence for this remains NZ on Air’s brilliantly broad “Where are the Audiences?” survey, the latest edition of which just dropped. It has been running since 2014, and just switched to annual surveys after running biannually for its first four instalments. The survey is different from all other major audience data in that it is not funded by businesses with a direct financial interest in discovering big and growing numbers – the radio, linear television and print newspaper and magazine surveys all suffer from this problem. It also is the only major survey which attempts to compare across mediums – pitting gaming against Sky TV against TikTok – and breaks down the data across different demographics.
I have written about it for the last five years, and it is truly my favourite data to analyse – the survey is a sincere and highly plausible attempt to understand what is going on our big and small screens around the country. And its findings are always fascinating, and should force some of our biggest institutions to grapple with who they’re really speaking to, and who they’re not. It is delivered as a 100+ page presentation, but here are the numbers which leap out as the most interesting and important, beautifully rendered by my colleague, our new head of data Harkanwal Singh.
Netflix and YouTube have replaced linear TV for under 40s
This is the megatrend which remains in full flow: the decline in linear television viewing for those under 40. TV was once the unquestioned champion of media, a medium almost everyone consumed which unified the nation and gave us a shared culture and perspective.
No longer. The survey asks its 1,420 respondents (found through phone and online, balanced for demographics and with margin of error of 2.6%) which media they used the previous day. Just over half (56%) nominated linear television, a number which drops to around a third for those under 40. It’s worth remembering that under 40s represent over half of our population, and one which (naturally) heralds the coming behaviour patterns.
Their use of linear television has almost halved in just five years, a staggeringly fast drop. What they do instead is streaming. As the chart shows, online video – particularly YouTube – remains very strong. But it’s subscription video, or SVOD, which has risen most steeply, to functionally replace television as the core platform for this half of the population. This category is dominated by Netflix, which is now in a massive 64% of households – this is higher than Sky TV at its height, and not far off the number of households with a working television (76%).
Two things to remember about Netflix: it’s got hardly any New Zealand content on it and does nothing to push its users toward what NZ content is there. And it is entirely ad-free, meaning those wanting to influence and communicate with that audience, from business to government, have to try and find them elsewhere.
The problem with television is really a problem with Sky TV
This is another way to look at the decline – through that of time spent with various mediums. It shows that the decline of linear television is actually better understood as the decline of a single product: Sky TV’s black boxes, which were once in over half of our living rooms, and are now in less than a third. Those who still have them are more likely to be older Pākehā, who still spend a significant amount of time watching, but there is no getting around that plummeting subscription rate.
Unfortunately for the big linear companies in TVNZ and Three/Discovery, their fortunes are very much tied to Sky’s, as the decline in viewing is almost all attributable to the loss of Sky boxes – linear viewing through other means has otherwise largely stayed flat for seven years.
In the context of this era, that flat figure is quite extraordinary. You can see that by the continued decline of radio. Known as the cockroach of media, it nonetheless has registered a similar loss in consumption to pay TV. This is predictably more pronounced in under 40s, who are more likely to play online games that listen to the radio on any given day, as the below chart shows.
Both charts show a very large and sustained decline in music listenership too, though there is reason to believe that this is more of a behaviour shift than a decline in consumption – for many, music listening is more likely to happen on YouTube or TikTok than on a CD or even Spotify.
The behaviour changes are greatest among certain ethnic groups
The big lie New Zealand told itself over decades was that we were one big melting pot – different people who all mucked in and largely experienced the same things and had the same values. Propagating this was made much easier by a vast amount of state ownership and control over media, lasting until the '80s, and then by formidable cost barriers for any kind of mass communication, lasting until around the late '00s.
Then: fast internet, social media and smartphones blew that all up, along with a major burst of immigration. Now it’s clear that this country is made up of a large number of different communities which share some common traits but are also very different in important ways. That is abundantly clear in this survey, which shows that just as young and old Aotearoa diverges behaviourally, that can be even more pronounced when it comes to different ethnic or socio-economic groups.
Pasifika and Asian New Zealanders are two such groups. Both labels cover a multitude of cultures and ethnicities so can obscure as much as they reveal, but there are some common characteristics too. They frequently will have multiple languages, and use closed captioning more than the average New Zealand population (though at 38% daily usage, along with all the accessibility it brings, this should now be mandatory for all major platforms).
They are also younger than the country as a whole: the most recent census showed Asian New Zealanders' average age is 31, while that of Pasifika is just 23. (This also explains why low vaccination stats for Pasifika were so misleading – when you control for age the gap disappears, and a very large majority were simply not eligible).
As a young population, Pasifika are more likely to use connected mediums – streaming music and television, online gaming, podcasts (one of a relatively small number of mediums growing across the board) and less likely to use traditional media like linear television, radio or newspapers. This is also true for Asian New Zealanders, who are in some respects more pronounced in their digital adoption, perhaps due to a large number being relatively recent arrivals and using the long tail of digital media to connect with language and culture that is unavailable on the big monolith platforms. (Māori are also strong on digital, but differ in important ways, with a greater than average propensity to consume radio and Sky TV, for example).
The youngest are even more different again
The youngest New Zealanders surveyed (it starts at 15 – we can only assume that the characteristics of those under that age are even more pronounced) are the starkest reminder we have of the stakes here. Those aged 15-24 are roughly three times as likely to watch online video (91%) as linear television (36%). Similarly for streaming music (81%) over radio (31%). Newspapers, a decade ago fairly commonplace, are a daily habit for a quarter of the population as a whole, but only 7% of those aged 15-24.
It's telling that some platforms which didn't even exist when the survey started, or weren't particularly relevant, are now dominant in this demographic. Instagram has a 20% daily reach across all of us, and TikTok an impressive 11% – but among 15-24 year olds Instagram reaches 56% daily and TikTok 39%. They are the platforms of the future – for now.
What does it all mean?
The conclusions to draw depend on the questions you’re asking. On one level, it’s remarkable just how little of this behaviour change shows up in advertising spend. In fact, the two major media companies which report their earnings (TVNZ and NZME, the publisher of the NZ Herald and owner of half of our radio stations) both just announced spectacular results. This maps to a known oddity in the US, whereby audiences for television shrink every year, but ad spend remains the same – a trend which is now a decade old.
This might be because television and radio remain incredibly effective mediums, so that even at a smaller audience scale they still represent value for advertisers. But it’s also because digital remains a phenomenally challenging arena in which to operate. As the data shows, audience behaviour is incredibly diverse, splintering wildly across different screens and platforms, and always changing too. Many of the highest growth platforms are ad-free, or close to it – Netflix, Disney+, online gaming. And scandals like ad-fraud and Facebook’s notorious goosing of its video stats have made some marketers wary.
Yet this data shows us very powerfully that to fail to engage with this complexity means deliberately and knowingly excluding millions of us. The default strategy to simply "mop up" those being missed has tended to be driven through the big social and user-generated platforms like Facebook, YouTube and Instagram, but even they are flattening, and remain challenging environments to operate in. Yet there is no alternative but to embrace the complexity and let spend follow the behaviour – anything else is bad business for those wanting to sell to those audiences.
The more confronting challenge is for government. If a business misses an audience, either intentionally or because its media buyer couldn’t find them, that hurts their bottom line. If the state can’t get its message to the right audiences then it is providing a service to one part of the population and not another. This is especially acute at the moment with the delta outbreak particularly impacting the Pasifika community. The government's ability to reach and speak to that community, to be trusted and known, is predicated on it not just showing up in an emergency (that’s if it can find them at all).
This also goes for the state’s media organisations, RNZ and TVNZ, and for Māori TV. All remain dominated by their core products, radio and television, mediums which naturally skew older. And for NZ on Air itself, which is tasked with funding “authentic NZ stories and songs that reflect New Zealand’s cultural identity and help build social cohesion, inclusion and connection”. It can only do that if it reaches all New Zealanders as evenly as possible.
NZ on Air admirably funded this research, and has done so for years now, but it still commits a large majority of its funding to projects which have radio (through RNZ) and television as their primary platform. TVNZ OnDemand’s audience actually declined in this survey, though its own data will doubtless contradict that (something all individual brands referenced within will likely do – the aggregate medium data is more interesting and instructive, anyway). In any case, it seems clear that New Zealand's on-demand video sector is not in growth mode by comparison to the streaming giants.
This survey definitively shows that continuing the way we used to is an indefensible strategy. The most important question is how best to respond. The old models were predicated on big audiences and predictable behaviour. The new one relies on infinite niches, with consumption built by algorithm, and behaviour in constant flux. The most enticing platforms are locked behind subscription paywalls and thus largely inaccessible to NZ on Air’s current funding criteria. Most importantly, the great digital migration has been characterised by an enormous shift from platforms owned and controlled within this country, to platforms owned and controlled elsewhere, largely in Northern California.
Which is to say that responding to this will be incredibly difficult. For those in media, in advertising, in communications and in government, it is incredibly confronting. Yet it cannot be ignored or denied. In an era where good information is life and death, and ties which once bound us are fraying, figuring this out ranks as one of the more important tasks we face as a society.
Declaration: The Spinoff airs content funded by NZ on Air and created by external production houses, including its sister organisation, Hex Work Productions.