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Entertainment-at-home services on the up

December 15, 2008

Parks Associates has reported that almost 66 per cent of US consumers have altered their spending habits in the fourth quarter of 2008 as a result of the country’s deteriorating economic conditions. These changes have the greatest impact on entertainment spending outside the home, according to Digital Media Evolution, a consumer survey from Parks Associates, but also open new areas for growth in customer support services.

The project found that as consumers cut spending on outside sources, this trend creates greater dependence on at-home entertainment services, creating new opportunities for broadband, communications, and entertainment providers in offering customer support, self-diagnostic, and troubleshooting solutions.

“For household services such as Internet and pay TV, recessionary concerns have less impact,” said Kurt Scherf, Vice President, Principal Analyst, Parks Associates. “Consumers are more likely to cut back on outside entertainment expenses before trimming household services such as home telephone, pay TV, and Internet.”

Digital Media Evolution reports US consumers are most likely to cut their spending on dining out, travel, and out-of-home entertainment. Additionally, nearly 50 per cent indicate that they will be spending less on consumer electronics because of economic conditions.

Parks Associates advises providers to take back-to-the-basics approaches to revenue growth and cost savings. The firm reports that service provider costs for supporting home networks alone could total hundreds of millions of dollars annually. By implementing self-diagnostic and troubleshooting solutions and building remote support capabilities, service providers can turn customer support from a liability into an opportunity, reducing OPEX costs initially and growing revenue-generating customer support businesses in the long term.

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