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For TV Streaming, Smart TVs Take Center Stage

Smart TVs correlate with heavier content consumption

December 31, 2012 | Media & Entertainment

Consumers have been taking up connected TV viewing for some years now, with millions already owning electronics systems that allow them to stream content directly to their TVs. Now many US households are readying themselves to either replace old models or add another TV set to their home.

According to a November survey by YuMe, a digital brand advertising services company, and Frank N. Magid Associates, a research and consulting firm, 45% of US consumers total said they planned to purchase a new television in the next year, the largest percentage of consumers in years to purchase new TVs or replace their old sets.

US Internet Users Who Plan to Purchase a New TV in the Next 12 Months , 2002-2012 (% of respondents)

To drive this trend, retailers and manufacturers have been aggressively discounting prices and upgrading features, and their efforts to put a connected TV in most homes seems to be paying off.

Smart TV manufacturers, as well as content providers and advertisers, will be major beneficiaries of the heavy pace of acquisition. The study found that 8% of respondents who did not already own a smart TV were “very likely” to buy one of these TVs connected directly to the internet in the next 6 months. That will push the adoption of smart TVs up to 20% of homes in 2013, according to the study.

In addition, connected TVs overall are on the cusp of dominance in US households. These TVs connected to the internet either directly or through an external device are expected to reach 42% of US households by the end of next year.

Despite the rapid rise of the smart TV, however, the study confirmed what other researchers have also found—video game consoles remain the primary means TV users have of connecting their television to the internet.

US Internet Users' Interest in Connecting a TV to the Internet, by Device, Nov 2012 (% of respondents)

Even if smart TVs trail other internet-connected TV sets in terms of adoption, the all-in-one electronics are driving increased consumption. A nearly equal percentage of respondents expected to increase their connected TV viewing on consoles, Blu-ray players and internet video devices, at approximately 37% each. But an even greater percentage, 59%, of those watching on smart TVs expected to up their consumption.

Expected Change in Viewing via Connected TV Services According to US Internet Users, by Device, Nov 2012 (% of respondents)

As content providers and manufacturers work in tandem to drive adoption and viewership of smart TVs, it’s useful to know what consumers actually want out of the newer devices. As with so many of the latest internet-connected technologies, unlimited access and free content ranked high. The top benefits of streaming content to a TV, according to respondents, were “watching whatever I want, whenever I want” and “find[ing] TV shows and movies to watch for free.”

And, as an extension of streaming as a lower-cost way to watch TV, over a majority of respondents cited some downgrading of paid services or product purchases as a benefit of streaming content to a TV.

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Check out today’s other articles, “Holiday Shopping More Mobile Than Ever” and “Japan to Lose Ad Spend Edge to China in 2014.”



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