Traditional TV still big draw, but numbers keep sliding

Online streaming continued to dent traditional broadcasting businesses last year as more Canadians accessed television and music on the internet and spent less time on old-fashioned TV and radio, according to a new report from the federal broadcast regulator.

Foreign and domestic internet video services earned an estimated $2 billion in revenue in 2016, up 17.8 per cent from last year, according to the Canadian Radio-television and Telecommunications Commission’s report released Wednesday.

Subscription services such as Netflix Inc. and BCE Inc.’s CraveTV pulled in $1.1 billion in cash, with the remaining revenue coming from transactions such as renting a TV show on iTunes, or advertising on free videos on services such as YouTube.

The massive growth in online services contrasts with stagnant or declining revenue for conventional TV stations, TV service providers and radio stations — and the creative industries they fund through mandatory contributions based on a percentage of revenue.

The federal government released a plan to help content creation in a digital era, but received mixed reactions for the strategy that included a $500-million production investment from Netflix.

But there’s no argument that online video is getting more popular. The CRTC found 44 per cent of Canadians subscribed to online video services in 2016. That number jumps to 64 per cent for Canadians aged 18 to 34. In this age group, the CRTC reported 23 per cent watch TV exclusively online.

“This year’s report shows how much younger Canadians are turning to digital platforms for their audio and visual content,” CRTC chairman Ian Scott said in a statement. “That being said, traditional broadcasters are adapting to this reality and their services continue to be attractive options for many Canadians.”

Canadians still watched an average of 26.6 hours of traditional TV per week in 2016, down from 27.2 hours in 2015. That easily trumps the average 3.1 hours they spent watching internet TV in 2016, although that increased from 2.7 hours in 2015.

Nor do they plan on cutting the cord en masse. Nearly 80 per cent of subscribers say they’re unlikely to axe their TV packages in the next year.