Streaming viewership exceeded cable and broadcast combined for the first time last month, report says

Streaming services surpassed cable and broadcast television in U.S. viewership for the first time in May, capturing 44.8% of total viewership compared to 44.2% for cable and broadcast combined, according to Nielsen. Streaming usage has surged 71% year-over-year, while broadcast and cable have declined 21% and 39% respectively. YouTube led individual platforms with 12.5% of viewership, followed by Netflix at 7.5%, with free streaming services like PlutoTV, Roku Channel, and Tubi contributing significantly to streaming's growth.

Analysis

Nielsen's May report marks a significant inflection point in U.S. television consumption, with streaming services capturing 44.8% of total viewership, for the first time exceeding the combined 44.2% share of cable and network television. This milestone is underscored by a dramatic 71% year-over-year increase in streaming usage, contrasting sharply with a 21% decline in broadcast and a 39% drop in cable viewership over the same period, signaling an accelerating structural shift in media consumption. YouTube has emerged as the dominant individual platform, commanding 12.5% of total viewership, followed by Netflix at 7.5%. Notably, free ad-supported streaming television (FAST) services, including PlutoTV, Roku Channel, and Tubi, are identified as major growth drivers, collectively accounting for 5.7% of total TV viewing, highlighting a diversification within the streaming ecosystem beyond subscription-based models and indicating robust consumer adoption of ad-supported tiers.

Key Decisions for Investors

• Investors should re-evaluate holdings in traditional cable and broadcast companies given the accelerating decline in their viewership share and consider reducing exposure if not already hedged against this secular trend.
• The sustained, rapid growth in streaming, particularly the strong performance of free ad-supported services, suggests potential opportunities in companies like Roku or others well-positioned in the FAST segment, which is capturing a significant and growing portion of viewership.
• While Netflix (NFLX) remains a key player with 7.5% viewership, its position relative to YouTube and the collective strength of FAST services underscores the competitive intensity; therefore, a nuanced approach to allocations within the streaming sector is warranted, focusing on platforms with diverse monetization strategies and strong user engagement metrics.