Web-Connected TVs In 49% Of U.S. Homes
A study shows the technology continues to gain ground in the U.S. But adoption curves always flatten, which means companies like Neflix will have to seek other ways to grow. Deadline's David Lieberman explains.
There’s encouraging and discouraging news for just about everybody in the TV ecosystem from Leichtman Research Group’s latest study of emerging video services. The survey of 1,211 households shows that nearly half (49%) have a Web-connected TV, up from 44% last year and 38% in 2012. And people are using the capability. Some 24% of adults watch an Internet-delivered video on their TV at least once a week, up from 17% in 2013 and 13% two years ago. The changes were “spurred by Netflix’s decision in the third quarter of 2011 to focus on streaming video, coupled with the proliferation of connected TV devices, smartphones, and iPads and tablets,” says principal analyst Bruce Leichtman.
That’s a problem for pay TV companies. Netflix’ popularity is growing among non-subscribers — including cord cutters. About half (48%) of people who don’t pay for cable or satellite TV do take Netflix, a leap from 29% in 2012. On the flip side, the percentage of Netflix subs who also buy cable or satellite service fell to 80% from 85% in 2012 and 88% in 2010.
Yet the data also point to potential challenges for Netflix. About 80% of its 35M domestic streaming users watch on a connected TV set — a percentage that has held steady for years. That’s fine as long as there’s been growth in the number of homes with smart TVs, or with sets connected via dedicated streaming devices … Read More »
Ray Richmond contributes to Deadline’s TCA coverage.
During a morning producers panel at TCA that focused on the brave new world of web television, a handful of pros held court to talk about all of the ways the Internet is changing the content game and taking the programming monopoly away from the living room. The five included Jane Espenson and Jeff Greenstein, producers of the Internet sensation Husbands (along with many network series); Mike Rosenstein and Stuart Cornfeld, exec producers of the web reality dating spoof Burning Love; and Ryan Lewis, exec producer of the web series Chosen. The beauty of fledgling form, all agreed, was how freeing the medium is in releasing writers and producers from the tyranny of their network overlords. “We are answerable only to ourselves,” boasted Greenstein, whose credits include Desperate Housewives, Friends and Will & Grace. “Yet we hold ourselves to the same standard as we’re held to when we’re doing network shows. We work really hard on the jokes and research and the look of the show. We try to make it as polished as possible. It’s completely on us if it’s good or bad, and that’s exhilarating after 20 years of receiving network notes.” Espenson agrees that the lack of notes is revelatory in itself. And yet she insists that the work involved, the writing, the production values, all are the same as if she were producing for regular TV. “We want it to have precisely the look and style of a traditional sitcom,” Espenson said. “More and more, television is not a word for a box that sits in your living room but simply a word for filmed entertainment that you enjoy.” Read More »
You might wonder about that when you see how many people seem to prefer watching shows on tiny smartphone screens instead of an HDTV. But quality still matters according to a survey of more than 3,000 people in the U.S., UK, Germany and Brazil out this morning from tech company Avid. Some 65% of the respondents cited image and audio quality as the strongest “driver of viewer engagement,” the company says. Amazingly, the survey finds that nearly 72% believe that 11% of the average viewing time will come from Web services by 2017 — with a quarter saying that it will account for more than 30% of viewing time. That still seems far-fetched: it would indicate that Web video time would grow by a factor of 10 in just four years in the U.S. and Western Europe. Even if those estimates are overly optimistic, researchers have good reason to observe that the market “is at its point of inflection, and broadcast and studio executives see these new web-delivered services as revenue drivers, with 91% of respondents citing multi-screen delivery as a key source of growth.” Translation: It’s time to get serious about using VOD for catch-up viewing, streaming programs, and offering special content so mobile devices can be used as a second screen when people also are watching their TV sets. The study for Avid was conducted by research firm Ovum.
It’s a shame that the general public usually can’t read industry reports from Bernstein Research’s Craig Moffett. When he’s on, which is frequently, his stuff is as thought provoking and engagingly written as anything you’d see in The Atlantic or The New Yorker. So I’ll consider it a public service to summarize his compelling effort this morning to bust one of the tech world’s most fervent beliefs: that that some company — perhaps Google, or Apple, or Netflix — will topple the pay TV oligopoly by offering cable programs or channels, possibly a la carte. Microsoft recently backed away from its dream of offering a cable-like service through its Xbox game console. Others will also give up, Moffett says, because the problem isn’t that Comcast or DirecTV are ignoring consumer demand to break up the expanded basic package. Six companies — Disney, News Corp, NBCUniversal, Time Warner, CBS, and Discovery — account for 90% of all viewing hours. They demand that their channels be sold in packages, ”and only that way,” Moffett writes. Didn’t the music industry try to do much the same thing with CDs before it had to back down and sell individual tunes for 99 cents? Yes, but the music industry had to respond to Napster offering songs for free. The danger of that happening to TV channels “is nothing like what the music industry faced ten years ago (at least, not yet),” Moffett writes. Read More »
Rivals of Carlos Slim are protesting to government regulators his delivery of TV programming over the Web in Mexico, Bloomberg reports. Grupo Televisa CEO Emilio Azcarraga complained last month and TV Azteca has filed suit against Slim’s companies as well as complained to the nation’s phone regulator over Web broadcasts such as last month’s Pan American Games. Slim’s America Movil and Telefonos de Mexico are forbidden from using their networks to offer TV service under the terms of their telecommunications license that was acquired in a 1990 privatization sale. Slim has tried unsuccessfully to reverse the ban, especially as Televisa has begun offering phone and Internet service to lure away his customers.
Banning web videos without a broadcast license would also affect companies such as Netflix, which has begun streaming services in Latin America, and Mexican phone company Maxcom, which started an online TV plan in September. Jose Otero, an analyst at Signals Telecom Consulting based in Uruguay, said that “if you’re going to need a broadcasting license to offer video streaming, you’re going to need to block a lot of companies.” America Movil is already the biggest pay-TV provider across all of Latin America, with 12.5 million subscribers, mostly in Brazil, compared with DirecTV’s 10.3 million. And America Movil is moving aggressively toward delivery of pay-per-view and streaming of Hollywood movies. Read More »