Channel 4 is locked in a battle with “Netflix and porn” for the attention of younger audiences, according to its chief executive, as the television industry battles to attract a new generation of viewers raised on streaming services.

Alex Mahon joked about the challenge faced by the traditional channels as she unveiled new commissions with an increased emphasis on shows produced outside London and those that could appeal to more diverse viewers – including a new sitcom called Lady Parts about an all-female Muslim punk band, and a drama called Generation Z about baby boomers turning into zombies.

Channel 4 also announced a show called The British Tribe Next Door, which will see Gogglebox star Scarlett Moffatt relocate her entire family to Namibia, where they will live alongside the semi-nomadic Himba people in a purpose-built replica of their County Durham semi-detached house.

Although Mahon’s comment, made during a dinner at the Edinburgh television festival, was said in jest, it reflects a growing acceptance among many senior television executives at the annual industry event that young audiences are unlikely to ever truly embrace scheduled television.

This is forcing a radical rethink of how to measure success, with British television bosses increasingly accepting that they are no longer competing with one another but are battling with other forms of entertainment for attention.

Channel 4 is attempting to improve the popularity of its All 4 catch-up service and the number of hours watched by viewers, rather than traditional live viewing figures. It is also putting more money into its youth-focussed E4 strand, moving staff out of London, and launching a new ad campaign based around complaints from viewers.

Patrick Holland, the controller of BBC Two, told the festival audience that he accepted that traditional live television channels were increasingly watched by older and wealthier viewers. He insisted his channel was fighting back, with shows such as a rebooted Top Gear attracting a consolidated audience of more than a million viewers in the 16-34 age bracket.

“Broadcast television has a problem with younger audiences,” he said. “The whole of broadcast television has older, posh people watching.”

Holland said viewers are moving “towards an iPlayer-only world”, aided by the BBC’s decision to make most programmes available for up to a year on catch-up.

In turn, this will create a growing need to make sure audiences are aware that the publicly funded broadcaster was responsible for the programmes. Holland said many viewers of the drama Peaky Blinders associate the programme with Netflix, where past series are available on catch-up, rather than as an original commission from the BBC, which helped develop the show and nurtured its growth.

To make matters worse for traditional commercial broadcasters, Enders Analysis on Wednesday said it was forecasting that British TV advertising spend would fall 5% year on year during 2019 due to the prospect of Brexit on 31 October, with companies cutting back on marketing budgets and shifting their money into other forms of media.