DVRs help ward off cord-cutting as digital video consumption rises
Michelle Clancy ©RapidTVNews | 06-01-2012 Good news for pay-TV: new research has determined that DVRs are playing a significant role in combatting cord-cutting and preserving consumers’ cable and satellite television subscriptions.
A new study from Deloitte’s State of the Media Democracy practice found that DVRs represent an opportunity for cable and satellite TV providers in the US. Respondents said that using a DVR is the second-most preferred means of watching one’s favourite TV show. Yet, only 44% of those surveyed have DVR functionality, indicating an untapped market.
“Consumers have shown that they value DVR functionality, yet the majority of Americans don’t have a DVR in the home. This represents a potential opportunity for cable and satellite TV providers,” said Phil Asmundson, vice chairman and U.S. media & telecommunications sector leader for Deloitte. “In a world where consumers have other ways to access content, the DVR may be an underutilised service that could serve as a value-add for new and existing subscribers at minimal cost to cable and satellite TV companies.”
It's not exactly a newsflash, but the findings also revealed that digital movie and e-book consumption is on the rise, driven by the proliferation of compatible devices, particularly on new platforms like smartphones and tablets. As recently as 2009, only 28% of Americans reported streaming a movie; today, 42% report streaming.
The key? It's simply getting easier. "Movies are available on a wider array of platforms – home TV via cable, satellite, DVD, pay-per-view, Internet and online via streaming/downloading to a personal computer, gaming console, smartphone or tablet," the report noted.
Moreover, the number of people citing streaming delivery of a movie to their computer or television as their favourite way of watching a movie rose to 14% from 4% in 2009. And the percentage of non-consumers is dropping as well. In 2007, 37% of people said that they had not viewed a movie via purchase or rental during the past six months. In 2011, that percentage was only 19%.
"Our data shows that while Americans may be less interested in physical content, their appetite for digital content continues to grow," said Asmundson.
He also raised the cord-cutting spectre: “Consumers may be watching fewer television shows and movies on TV, or reading fewer physical copies of books and newspapers, but they have not stopped consuming the content. They are simply watching or reading on different media or platforms."
A number of Americans have already cut, or are exploring cutting their pay TV connection entirely, he said. Deloitte’s survey found that 9% of people have already cut the cord and 11% are considering doing so because they can watch almost all of their favourite shows online. An additional 15% of respondents said that they will most likely watch movies, television programmes, and videos from online digital sources (via download or streamed over the Internet) in the near future.
Meanwhile, when it comes to smartphones, Americans are beginning to use them as “all in one” devices for a number of different tasks. “Smartphones allow consumers to greatly expand a phone’s functionality by downloading different applications, said Asmundson. ”As the costs for these types of devices, apps and the wireless services that come with them continue to fall, consumers are starting to shift their behaviour, taking advantage of connectivity, performance, and portability that rivals and often beats that of a laptop."
He also noted that as 4G rollouts continue and new smartphone technology is introduced, makers of single purpose devices may need to adopt similar business models if they want to remain competitive.