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Recently I have received a lot of questions concerning changes in TV ratings after switching to digital broadcasting. In this publication I will explain some of the possible changes hoping that it will shed a light on at least some of the concerns. Although my conclusions put the nearest future of the main commercial channels’ ratings in a somewhat declining state, this has already been accepted as truth in the majority of media buyers in Latvia.

The situation with switching to digital TV broadcasting is still unclear in Latvia as MTG group (TV3, 3+ and TV6) has announced that it will be staying in analog broadcasting untill the end of 2010. While it can’t be ruled out completely, this is an unlikely scenario because then MTG will most probably have to cover the entire analog broadcasting expenses as it will be the only channel group staying in analog TV after other channels switch to digital in 1st of April in Riga and 1st of July in the rest of Latvia.

First, lets’s take a look at how TV viewers are split among the different TV reception types available today:

Source:TNS Latvia

As we can see from this table 28,6% of TV viewers will have to choose between purchasing digital TV decoders or installing cable or DTH receivers, or switching to internet TV. This will be a burden to viewers with low-income as any of these solutions require financial investments. Taking into account other countries’ experience as well as the fact that TV is the most consumed media in Latvia we can speculate that the fall of total TV viewers will be temporary and will not exceed 6-8% of the total population. This fall will not impact ratings but might lower the universe size for the TNS TV rating system resulting in a slightly higher TV CPC figures.

Let’s take a look at the channel viewership shares:

Source:TNS Latvia

Whatever solution the terrestrial viewers choose after the end of terrestrial bradcasting, the amount of channels available to them will increase and that will change the overall shares for TV channels. It is hard to prognose the actual share canges but it is clear that the major channels will lose their shares to other local and international channels. It might be speculated that the shares of major channels, other local channels and international channels will more or less even out, with major channels still leading the viewership shares by a few percent.

The change in average reach figures for TV channels after switching to digital broadcasting will most probably be milder than the change in shares:

Source:TNS Latvia

The terrestrial channels’ average weekly reach figures might fall by up to 10% after the end of analog broadcasting. On average, terrestrial viewers use TV more frequently so there is a possibility that after switching to digital, cable or DTH, the decrease of major TV channel reach will be smaller than the increase of other local and international channel reach figures due to people still being loyal to major channels but actively watching other channels as well.

The following chart shows average channel ratings in 2009:

Source:TNS Latvia

If we compare this chart to the average reach chart (shown previously), an interesting TV viewing pattern emerges. It can be seen from these charts that although reach figures are more or less same for the major terrestrial and other local and international channels, the average ratings differ greatly. This is because the viewers like to browse through all the channels available to them (which increases channel reach) but choose to continuously watch only a few of them (which lowers channel ratings). This might change the ratings’ accumulation after the end of analog TV from major terrestrial channels to other local channels and, more importantly, to international channels. This migration of contacts might lead to lower advertising revenues as well as ROI levels and should push advertisers to using more creative TV advertising solutions to cope with the lower ad frequency levels.

Jānis Kļaviņš nodarbojas ar Inspired analītikas, pētījumu un attīstības lietām no 2007.gada. Izglītība – bakalaurs, programmēšanas inženieris, pārliecība – nav neinteresantu lietu, lietas par neinteresantām padara apātiski cilvēki. Iedvesmojas no sabiedrības, izklaides, mūzikas un informācijas. Twitter: @klavinsjanis.