Smart TV may be too smart to win over consumers

Joseph O'Halloran ©RapidTVNews | 01-06-2012

A new report from leading management consultant McKinsey is warning that beyond the hype the maturity of connected TV and most importantly the consumer appeal of its value proposition are questionable.
The company based its conclusions on research conducted in France and the UK, McKinsey assessed the smart TV opportunity and determined how TV manufacturers, media/content providers, and telecoms operators should prepare for this new battleground.

Concurring with other recent reports McKinsey concluded that from a supply side at least, the transition to connected TV seems unstoppable in the two markets and calculates that Internet connectivity in TV sets is slowly but surely becoming a mainstream feature. Given the current growth of TV sales, it expects the installed base of Internet-enabled TVs to grow 70% each year to reach over 500 million devices by 2015.
Yet McKinsey also says that there has been a lukewarm reception for smart TVs so far. That is to say despite the active push on the supply side, actual usage remains marginal with only a tenth of households owning a smart TV and only 3% of them actually using Internet functionality.
The research also revealed two main bottlenecks along the adoption funnel, which given the status of the UK and France, should provide cause for concern. First, awareness is low regarding what smart TVs actually are, with only 42% of households in France and 62% of households in the UK even knowing about the technology – this compares with 80% of UK households aware of game console technology, and 81% of those in France knowing about set-top boxes. Second, over half of the tenth of households who currently own a smart TV have never tried to connect it. This says McKinsey reflects the relative power of alternative devices (laptop, tablets) that fulfil the primary entertainment needs and also points to the perceived technical complexity of actually connecting the smart TV.
Yet concluding on an optimistic call to action, McKinsey says that despite the fact that generally speaking smart TVs have yet to deliver on their promising potential, they do have a potential which could be breakthrough. One which the firm believes will be realised if set manufacturers find the killer technology for user-friendlier interfaces, while enriching their platforms with more extensive and appealing content.