[Stuart]

Originally Posted by OLD BOY

This article focuses on the BBC licence fee, but interestingly it draws the conclusion that streaming subscribers are becoming more familiar with programming without interruption, and this is slowing advertising sales growth for broadcasters.

Actually, Netflix are currently experimenting with advertising on their own programmes. It's not to much of a stretch of the imagination to think they might look at extending that to other programmes (assuming licences allow them to). It's also not too much of a stretch to imagine they may not allow skipping. So, the future you (and the article) appear to be speculating about may not include programming without interruption..

It is this slowdown in advertising sales that will kill off most broadcast channels eventually because this is what they rely on for revenue.

You are, of course, assuming that the likes of ITV cannot or will not compete with Netflix et al. I'd be surprised if they don't.

For instance, global voluntary subscription revenues are forecast to grow by 3.5pc per year up to 2019, compared with only 0.7pc for licence fees.

Over the same period in the UK, the overall proportion of households with some form of voluntary subscription television, whether via cable, satellite or over the internet from a telecoms provider such as BT, is forecast to increase from 57pc to more than 62pc.

This is where I feel the article is wrong. It's comparing Apples and Oranges. Most UK households have a licence. Those that don't either don't need one or are unlikely to buy one whatever the TV licencing company do. As such, the revenue from the licence fee is unlikely to increase much unless the government authorise a massive increase, which they are unlikely to do.

The on demand TV market (and to some extent the linear pay TV market) is nowhere near the same level of saturation , so they have a *lot* more room to increase revenues.

That predicted growth does not include the added impact of streaming services that are not necessarily bundled with an internet access subscription, such as Netflix and Amazon. Total revenues for such "over-the-top" services are expected to more than double from £216m last year to £497m in 2019. Those streaming services include Sky’s Now TV, as well as those on offer from US technology companies.

Those figures do sound impressive, but let's put them in perspective. They are combined figures from all the subscription on demand providers, including Sky, Netflix and Amazon and they have doubled, but they are still under half the programming budget for ITV (£1.04bn) ITV's revenue was £2.96bn (so, around 6 times the combined revenue for the streaming services.

In 2012, Channel 4 spent about £450m on programming. The BBC spent around £2.276bn on programming last year..

On a side note, while I like Netflix and Prime Instant Video and use both, that article presents the study as being so pro streaming, I'm wondering who paid for it.