Episode 199

Rural TV Trends

November 5, 2021

Episode Summary

Scott Meyer, Director of Marketing with Innovative Systems, stops by to discuss the latest trends and viewership stats for TV providers in Rural America. This episode was recorded live at the NTCA Fall Conference in Nashville.

If you would like a copy of the reports discussed in this podcast episode, please email that request to Scott Meyer at scottm@innovsys.com.

Show Notes

Transcripts have been lightly edited for clarity and readability.

 

Andy Johns: What are the latest trends in rural TV? That’s what we’re talking about on this episode of StoryConnect: The Podcast. My name is Andy Johns, your host with WordSouth, and I’m joined once again by a friend of the podcast, Scott Meyer, Director of Marketing with Innovative Systems. Thanks for joining me.

Scott Meyer: Thank you. It’s always a pleasure, Andy. Always.

Andy Johns: I enjoy getting together because there’s always a lot of interesting facts that come out of the study that you do. I’ll get you to introduce that in just a second, but we are recording this live at the NTCA Fall Conference in Nashville, Tennessee. It’s the center of the rural telecom universe this week. I’m excited to see a lot of folks. We’ve had a lot of people come by our booth, and it’s always good to be back in real life seeing people, not just on Zoom screens. So Scott, if folks have listened before, they have probably heard you describe and introduce this survey. This is may be the fourth or fifth one of these that we’ve done having you on to talk through it. But if you don’t mind, go ahead and give us the basics, the high level view. Tell us about this study, the survey, you all have done.

Scott Meyer: All right. Very good. Well, thank you, Andy. You know, I think I probably want to start by just talking about how we’re gathering the data. We actually have a software channel stats tool in our product line. And so all of the people that use our video solution are able to pull these channel stats for each individual company. And that helps them to determine things about viewership and peak times when people are watching channels. And then they can make some important decisions as to whether or not, if they’re not contractually obligated to carry a channel within a family of channels and nobody’s watching it, it gives them the confidence to make that hard decision. So what we decided to do a few years ago was to ask some of our reporting stations, or our customers that have our video solution, if they’d be willing to send us regular reports on their channel stats. And I was fully expecting maybe 20 companies. Well, we ended up with over 60 companies. So now we’re getting these reports month after month. And then quarterly, we tabulate the stats, which is what we’re talking about today, specifically the summer quarter from June through August 2021, but we’re pulling data from over 75,000 set-top boxes, Andy, and if you figure, you know, about 1.5, or maybe even 2, viewers per set-top box. We’re talking 100,000 rural consumers. So really, when you think about that data and the accuracy of it, we’re probably going to have one of the most accurate reports of what rural America is watching on what you would call cable channels or traditional channels. So that’s basically how and why we’re doing it, because we want people to know and help them to make decisions.

Andy Johns: Absolutely. That’s an excellent sample size, and it’s a whole lot more sophisticated. You know, I came from the newspaper business, and I remember the way — the very scientific way — that our newspaper would see who was reading the comic strips. They would just drop one for a couple of weeks and see if anybody complained. So if “Hagar The Horrible” didn’t show up and nobody complained, then guess what? Hagar was not coming back. This is a little bit more sophisticated than that I would say. This is a great data to have.

Scott Meyer: Yes, it certainly is. And we’re finding that a lot more companies are using this in their negotiations for content. And in some cases using it in retransmission negotiations for the alphabet networks: ABC, NBC, CBS, which is really a pain point for our video operators. But it’s a double-edged sword, Andy, because when we talk through the numbers, the top five are always those retransmission companies, you know, ABC, NBC, so it’s a challenge, but that’s what customers do want to watch.

Andy Johns: Excellent. And you know, any ammo they can equip themselves with for those negotiations, I’m sure helps. Let’s go ahead and get into it. Looking at the summer quarter here, and I know things we’ve talked before about how things vary a little bit quarter to quarter just based on lifestyle and everything else. But what were some of the things that really stuck out to you in what you saw for the summer quarter?

Scott Meyer: Well, I was really surprised because in the spring quarter, and it’s been for whatever reason, NBC and CBS have always swapped places quarter after quarter number one to number two, and I was fully expecting that NBC with the Olympics this summer would go over the top of CBS.

Andy Johns: They spend a lot of money on those Olympics to get those ratings.

Scott Meyer: I know, but surprisingly, and I’m not sure why, but CBS won number one, according to our stats. CBS came in at a 67.97 average set-top box, per hour view rating, and NBC was 62.33. So I’m not sure. I mean, it just really surprised me. I expected NBC was going to win, but they did not.

Andy Johns: Interesting, I’m sure that’s what they expected as well.

Scott Meyer: Well, I think they might have, and I really can’t correlate or provide any kind of information as to why that happened. But you know, that’s just part of the business, I guess.

Andy Johns: Right. Now you mentioned, there was another network or two that stood out. Was it Grit TV that you said had a pretty strong?

Scott Meyer: Yeah, I mean, we’ve been following Grit now for about three quarters, and Grit is a Western-themed television network. I believe it’s part of the carriage of ME TVs and antenna TVs and those types of things. So I think it’s part of local network programing, but it’s Western-themed, and we’ve talked about this in previous podcasts that that really does resonate with rural America, the demographics. And we know it’s having an impact because it is now, according to our data, Grit has now reached a position of, as I’m looking here, number 19. And they really weren’t even moving the needle about a year ago. And we think…

Andy Johns: That means 19th most popular or most watched network.

Scott Meyer: That’s correct.

Andy Johns: That’s impressive.

Scott Meyer: It is, and the number one premium channel Starz Encore Westerns, and it still is the most watched premium channel in our study. It has been for quarter after quarter after quarter. But their numbers are continuing to decline, and so combining that decline with Grit’s gain, we think that the people are moving over to that because it’s not like a premium-pay channel. And I think that’s the reason why Grit is really starting to take hold. And so we would always encourage companies to be out there on the lookout for these types of channels to carry for their customers. And I might just take one more moment — and I always put in a plug for this channel because I talked to another video operator this weekend at the conference who does not carry the Inspirational Network. 

Andy Johns: I remember you brought that one up.

Scott Meyer: We’ve talked about that, but that channel is consistently a top 10 month after month after month. In the summer quarter of this year, it was number seven. And it does have one of the lowest costs to carry for our providers. So really for them, there’s not a whole lot to lose by carrying this channel other than getting a lot of eyeballs on that channel.

Andy Johns: Interesting. I’m not a consumer scientist, but I can understand why customers, if they can get the same programing at lower costs with Grit, I can see why they would do that. And I could also see why if providers are out there having a top ten network, that’s a very low cost, that sounds like a win for them, for sure.

Scott Meyer: It is, and I would say probably about 30% of our reporting sites that send in these channel stats are not carrying INSP. And, you know, so many times I run into somebody like that, I just say, “You’ve got to carry this because the costs definitely justify the carriage of this channel.” 

Andy Johns: Why wouldn’t you?

Scott Meyer: Absolutely.

Andy Johns: Well, what other trends did you see? Whether it’s specific channels or bigger viewership or any of that? What other themes, trends, what other things stood out that you noticed?

Scott Meyer: Well, I think one of the things that we’ve been noticing — it was a very tumultuous year with the elections going into the inauguration…

Andy Johns: Tumultuous is one way to put it. It’s been described a lot of different ways.

Scott Meyer: And during that period of time, CNN and Fox News were at their highest viewerships ever, and now they are continuing to lose share. And I mean, they’re still holding some really strong positions, but they are continuing to lose share. CNN, for example, in the spring quarter, was in 11th place. This summer, it dropped down to 18. And then when we look at Fox News, Fox News is still strong. But when we compare the numbers, you know, they are number four, but they’ve been losing, you know, 2-3% share since basically the inauguration. So, you know, and I really don’t know what to make of that, but I do think that there’s so many things that go on within the political world that can affect the viewership. And right now, I mean, there are things going on, but it’s not what it used to be.

Andy Johns: Yeah, it’s not like last year.

Scott Meyer: So that was one of the things that I noticed. As I’m looking through the executive summary here in the report, the regional sports networks showed their seasonal rise. They came in at number six this summer, but that just makes sense. Primarily baseball, of course. And then the other thing, you know, kind of in the executive summary that I provide in the report is USA Network kind of surprised me because they hit top 10 status for the first time in the history of this report. And again, I don’t know a whole lot about USA Network, but there must have been something that drove that rise.

Andy Johns: Some hit series. Yeah, yeah. I’m trying to think what that will be. I’m not.

Scott Meyer: Yeah, and I’m hoping some of the folks that are listening to this podcast can connect the dots on that and use that to help them out.

Andy Johns: Sure. That’s an excellent point. Well, in terms of overall, because I know that you guys are right at the forefront of looking at streaming, looking at how that’s related to IPTV, what is in the near term and the long term. Did you see anything or notice anything to do with streaming, or how that the different apps there? And it seems like there’s a few new ones. We were talking today about Paramount+. And there’s Disney+ came out back in 2019. Have you seen any information or any data that gave you any conclusions about how streaming plays into all of this?

Scott Meyer: Well, I have and a lot of that goes back to our rural video and broadband study, and we did a podcast on that a few months back, I believe. And, you know, one of the … and I want to kind of refer back to that because as you mentioned, Paramount+, Peacock and Disney+. And when we did our rural study and questioned over 800 respondents about what are they streaming, obviously, Netflix is still been the big dog. But their share is eroding. Amazon Prime is catching up. And then we’re also seeing Disney+. We’re seeing ESPN+. We are seeing HBO Max. We’re seeing Peacock. We’re seeing those showing up in significant numbers, and they didn’t even exist on the radar screen like a couple of years ago. And now people are saying we’re paying for these streaming networks. So I think what we’re going to continue to see — as everybody that’s going to be listening to this podcast knows — is that there’s barely a week that goes by, that there’s not a new streaming network.

Andy Johns: It certainly feels that way.

Scott Meyer: And so what’s going to ultimately happen is a term that I’d like to trademark it and get royalties. It’s a term that we like to call app fatigue. And I think we’re starting to see that people are maybe kind of getting frustrated. There’s so many options out there that and that’s just another chink out of their checkbook. So that’s one of the trends that we’ve noticed. And then, you know, the other trend we’re noticing from a video provider standpoint is we’re seeing a lot more of our video providers that are now wanting to have a complimentary full channel lineup on streaming, and having an IPTV or cable TV play, running those simultaneously.

Andy Johns: Yep, that seems to be a good direction for all this to be heading. So, as always, the streaming world, figuring out TVs. It’s a lot of the wild wild west, and I like to think that your survey is helping people navigate that a little bit, that the study helps them know where that’s going. And I always appreciate you sharing the information from that on this podcast.

Scott Meyer: Appreciate it being here. It’s always interesting to share data and then hearing back from people and what they want to do with it.

Andy Johns: If people have questions about this or want to find out more, go ahead and throw out your email address or the way for them to get in touch with you to find out more.

Scott Meyer: You bet. Thanks, Andy. If they’d like a copy, if anybody listening to the podcast today would like a copy of the Channel Stats report, you can send it to scottm@innovsys.com, and I’m assuming you’ll put that up.

Andy Johns: We can put that up.

Scott Meyer: And then also that Rural Video and Broadband Study. Again, that’s about 70 pages. They can send that to the same email address, and we’ll send a digital copy of both of those to anybody that’s interested.

Andy Johns: Excellent. Great information to help navigate a constantly changing world of video services. So thanks again, Scott, for joining us.

Scott Meyer: Thank you.

Andy Johns: He is Scott Meyer, Director of Marketing with Innovative Systems. My name is Andy Johns with WordSouth and Pioneer Utility Resources. Thank you for listening and until we talk again. Keep telling your story.

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