ITVX, the online service from ITV, the leading commercial broadcaster in the United Kingdom, reported viewing for the first quarter of 2024 at 896 million streams was up 12% on the same period the previous year. What does that really mean, and does it constitute a success?
In its recent annual results, ITV reported external revenue for 2023 was down 3% at £3.6 billion but operating profit was down 54% at £238 million. So-called ‘digital’ or online revenue was up 19% at £490 million, partly offsetting a 15% decline in traditional television advertising revenue, resulting in an 8% reduction in total advertising revenue.
ITV delivered 1.5 billion online video hours in 2023, which was up 26% on the previous year. The target for 2026 is 2 billion hours, which on that basis seems achievable.
The number of monthly active users of ITVX rose to 12.5 million, compared to 10.5 million the previous year for the ITV Hub.
ITVX offers a premium subscription tier but total subscription revenues for ITV were only £59 million in 2023, up by just £5 million on the previous year.
January 2024 saw ITV deliver a record 328 million streams, more than any other month on ITVX or previously on ITV Hub, and February was just behind with 322 million, with March producing 246 million. On that basis it looks like usage has fallen since a strong start to the year.
Drama delivered 273 million streams over the quarter, boosted by 24 million for Mr Bates vs The Post Office at the beginning of the year, and was up by 24% on the previous year.
In Sport, the Six Nations rugby was streamed over 16 million times over 10 matches, up by more than 3 million streams compared to the previous year.
The FA Cup Quarter Final between Manchester United and Liverpool was streamed 6 million times, which was a record for a domestic football match on ITVX. Only the matches from the World Cup in 2022 and the Euros in 2021 had more streams.
“We’ve seen an incredible quarter for ITVX, continuing to build on a record-breaking month in January,” said Rufus Radcliffe, the managing director of streaming for ITV. “The breadth and variety of our content means that we really do offer something for a wide range of viewers and the continuing success of ITVX is testament to the work the teams across sectors from editorial to technology have put in.”
ITVX launched in late 2022, so this is the first year on year comparison of quarterly viewing. A 12% increase in viewing represents about 96 million additional streams over the quarter, or just over a million a day. That sounds a lot, but it is across a potential audience of 28 million homes with internet and television in the United Kingdom, or 63.5 million individuals.
The total of 896 million streams over three months works out at just under 10 million streams a day, although the number of streams is a bit of a meaningless metric without knowing the number of hours viewed.
The figure of 1.5 billion online video hours in 2023 must be compared to total ITV viewing of 13.1 billion hours, which was down by 5% on the previous year. ITVX viewing still only represented 11% of total ITV viewing, although that is up from 7% in 2022.
So, in that context, is an annual increase of 12% in online viewing a significant success, given the emphasis that the company has placed on ITVX?
Now, online viewers may be worth up to twice as much as viewers to broadcast services as they can be more accurately targeted, measured and tracked. But will that continue to command a premium as online viewing grows and traditional viewing withers?
A large part of the value of advertising on a mainstream channel like ITV is scale and the ability to reach a large proportion of the population over a relatively short time.
The risk in encouraging viewers to choose what, where and when to view is that rather than watching ITV programming at the time of transmission they may end up switching to something else.