YouTube taking over as Gen Z swerves broadcast TV in record numbers, Ofcom says

Younger audiences in the UK are avoiding traditional broadcaster TV more than ever, with less than half of 16- to 24-year-olds watching linear programming in an average week, media regulator Ofcom claims.

Just 48% of Gen Z and Gen A viewers regularly tuned in to watch terrestrial TV last year – the first time that number has dipped below 50%, and a huge drop from the 76% recorded in 2018.

Ofcom’s annual study into the nation’s media habits makes grim reading for executives in the heritage TV industry. The weekly reach of the sector fell by a record amount in the last year, from 79% in 2022 to 75% in 2023, a second consecutive year of record decline.

Children aged 4- to 15-years old are swerving broadcasters, with only 55% watching in 2023 compared to 81% in 2018. The decline in weekly reach among middle-aged viewers (45 to 54) also accelerated, falling from 89% to 84% in a single year.

Younger audiences aren’t just watching traditional TV less frequently, they’re also watching for shorter periods at only 33 minutes each day – down 16% year-on-year. Of this, a mere 20 minutes is spent watching live TV.

In stark contrast, video-sharing platforms (VSPs) including YouTube continue their rise to dominance. Gen Z and Gen A viewers spend three times longer each day (1hr 33mins) watching VSPs than terrestrial shows.

VSPs are also driving overall consumption of TV and video content in UK households. Viewing figures for VSPs were up 12% to 49 minutes per day – contributing to an overall 4hrs 31mins a day of TV and video viewing, up six minutes and 2% since 2022.

YouTube has established itself as the market leader among the VSPs primarily because it is available to watch on living room TV sets, while rivals such as TikTok remain mostly phone app based.

Ofcom reports that 34% of time spent watching YouTube at home is now on a TV set – up from 29% in 2022. This increases to 45% among children aged 4- to 15-years-old, rising from 36% in 2022.

YouTube’s growing challenge to the traditional TV model is no secret to executives in the kids’ content sector, who have warned of a mass exodus of younger viewers to online platforms for years now.

It was the hot topic at the Children’s Media Conference in Sheffield earlier this month.

Michael Rose, joint MD of animation prodco Magic Light Pictures, said: “We have a crisis in children’s media and there is a tremendous strain on the established platforms from YouTube, TikTok and other new online places.

“That has serious implications for how high-quality public service children’s content is going to be funded, where it’s going to be found and how children today are going to view it.”

Earlier in the year, media commentator Evan Shapiro warned that the entire TV ecosystem – not just the kids’ sector – has been severely disrupted by YouTube.

“YouTube is the biggest TV channel on the planet and one of the biggest competitors for eyeballs in the TV ecosystem,” he said.

“It poses a truly existential threat from an audience retention and revenue standpoint.”

Ofcom’s report shows that daily viewing of SVoD services saw marginal growth in 2023, up 6% to 38 minutes. Netflix remains the most popular OTT platform – watched for an average of 21 minutes per person per day, and accounting for more than half of all SVoD viewing.

Broadcaster video-on-demand (BVoD) offerings, such as BBC iPlayer and ITVX, rose by 29% to 20 minutes per person.

Total commercial TV and online revenue was marginally up in 2023, increasing by 0.5% to £15.6bn (US$20.02bn). The 20% increase in online video revenue to £5.4bn, mainly driven by SVoDs, was almost cancelled out by the 7.5% decline across commercial broadcast and pay TV, down to £10.2bn.

The greatest revenue decreases were among the public service broadcasters (PSBs) and digital multichannel services. They suffered declines of 16% and 10% respectively, to fall below 2020 levels.

Spending on original first run shows by the PSBs totalled £2.7bn last year, down 5.3% from 2022, but still 8.1% higher than the last pre-pandemic year, 2019.

Overall advertising expenditure increased by 5.3% to £36.6bn, again driven by online growth which rose by £2.6bn (10%). Social video on platforms such as YouTube, TikTok and Instagram, accounted for around £900m of this rise, up some 20% since 2022.

Ian Macrae, director of market intelligence, Ofcom, said: “Gen Z and Alpha are used to swiping and streaming, not flipping through broadcast TV channels.

“They crave the flexibility, immediacy and choice that on-demand services offer, spending over three hours a day watching video, but only 20 minutes of live TV. It’s no surprise that the traditional TV is fast becoming a device of choice to watch YouTube.”