Though traditional linear TV continues to fall — after an early bump up due to rising pandemic issues in March and April — one analyst believes things could get much worse.

Todd Juenger, the media analyst of Bernstein Research, writes: “We believe viewership, TV advertising and pay-TV subscribers may not recover to their pre-crisis levels, and rate of decline will increase as SVOD [subscription video-on-demand services] substitution continues.”

Traditional linear TV, which saw a 5% rise in total day persons 2+ viewership in March and April versus a year ago, has now fallen to 15% to 20% decline levels in July, versus the same time period in 2019 — per Bernstein Reserach analysis of Nielsen data.

During the same early pandemic period, prime time was only down 5% in mid-April, but is now seeing 20% declines in July viewing versus a year ago.

“COVID-19 brought audience declines to a halt, but the effect didn’t last,” he writes.

Though sports programming is coming back for some major sports — Major League Baseball, for example, and soon the NBA and NHL — cord-cutting issues will probably get worse.

While Juenger says there is no clear picture of how the April, May and June period performed in terms of cord-cutting, AT&T recently said it lost 954,000 subscribers (DirecTV, U-Verse, AT&T TV) in its second-quarter reporting period.

Pandemic issues were compounded by the lack of sports from March though July. 

“This has been exacerbated by the fact that, due to production shutdowns, there is a small and declining amount of fresh entertainment content being offered by the TV networks. Pretty soon, that will trend down to ‘zero,’ ” he writes.

This has forced viewers to move more to in-home video on-demand services, like Netflix, which continues to offer fresh programming. 

At the same time, lower traditional TV viewership has forced advertisers to do “zero-based budgeting” when it comes to linear TV, with more money going to “digital platforms — some of which will be captured by the TV network companies themselves, but not most of it.” 

He added: “Our belief is that both viewership and advertising spend will recover to a new normalized rate significantly below pre-pandemic levels.”

This article was originally published on: https://www.mediapost.com/