The TV Industry As We Know It May Really, Finally Be Entering A Death Spiral
Michael Seto/Business Insider
On stage at our IGNITION conference, Armstrong said he recently heard from an advertiser who said he got a rebate for his TV ad budget because the ads weren't going to be filled. The advertiser needed to spend the extra money digitally as quickly as possible.
It's unclear if this was just a one time blip, or start of something different. Armstrong seemed to believe it was the start of a big change. He thinks digital video advertising is finally starting to suck dollars from TV advertising.
New data from Nielsen explains why this is happening. Last quarter, TV viewing was down 4%, while video streaming was up 60%.
Off stage, he pointed us towards a story in the an interview with Daryl Simm, CEO of Omnicom's media operations, with the Wall Street Journal in October. In the interview, Simm recommended advertisers shift 10-25% of their budgets away from TV to digital.
When an agency is telling people to shift their budgets, it's a big deal.
As for whether this is just a blip or a long term thing, Armstrong told us that he recently hosted Thanksgiving at his house. He had a bunch of kids over, from teenagers to kids in their twenties. He saw them all sitting around in the living room watching video on their phones instead of looking up at the TV.
Are those kids going to suddenly change and start watching regular TV when they get older? Probably not.
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