Joseph O'Halloran ©RapidTVNews | 22-09-2011
As homes become inundated with CE devices capable of supporting TV experiences, the hopes of those predicting the inevitable rise of TV Everywhere look like being realised.
According to Digital Video: Three Screens and Beyond from Parks Associates, 15-30% of broadband households in North America and Western Europe are interested in a TV Everywhere solution. Furthermore, the survey found that the UK has the highest level of interest in a TV Everywhere solution, with nearly 30% of broadband households interested in a service allowing them to view TV programming on multiple devices, including tablets, smartphones, and connected devices. Similar desire for such services was found in Spain and Italy, markedly more interest shown in these countries than in Germany and the US.
Summing up US demand, John Barrett, Director, Research, Parks Associates said, “In the US, Netflix Watch Instantly is having a major impact on TV viewing trends, with 22% of all broadband households using this service, more than those who use Blockbuster retail stores. "
The analyst believes that service providers can leverage TV Everywhere to increase net additions and entice pay-TV subscribers to consolidate mobile phone and Internet services. The data suggests that around 15-30% of broadband households are willing to pay additional fees in order to obtain this service.
However from a business perspective, Parks cautions that even as multi-screen solutions and streaming options become available to more consumers and will be valuable in retaining and acquiring subscribers, they will be limited in their ability to expand ARPU. For example, a third of all broadband households would switch to a provider offering free TV Everywhere, and 10-20% would consolidate their mobile phone and Internet services with a provider if necessary to obtain TV Everywhere. As a result says the analyst, its potential to drive ARPU gains directly is limited.
"You can charge additional fees for TV Everywhere as long as nobody else offers it for free," Barrett added. "It's a great example of the prisoner's dilemma in economics. As soon as one player offers it for free, everybody will be forced to do so, or they will start bleeding subscribers." Barret cited the example Fox who recently erected a pay wall for its content, limiting initial online access to pay-TV service subscribers, seeing a noticeable increase in the downloads of Fox shows on torrent sites, highlighting the difficulty of implementing pay models for multi-screen video.