Advanced Television

30% of US Internet homes have a Connected TV

August 21, 2012

One of the most detailed studies undertaken on connected TVs to date has found that about 30 per cent of all Internet homes have TVs connected to the Internet and that users of those TVs are generally receptive to advertisements and ad-supported business models.

The results are from a survey of 736 connected TV owners and users done in May and June of 2012. Digital advertising software and services provider YuMe commissioned consulting and research firm Frank N. Magid Associates, Inc. to conduct.

“The basis for the study was that connected TV has become a hot topic in industry but like any nascent medium it is difficult to find baseline information that would help advertisers make informed decisions,” noted Travis Hockersmith, senior director of client strategy at YuMe in an interview.

One key finding, Hockersmith noted was the opportunities for advertisers on the platforms. Almost 90 per cent of connected TV users reported that they noticed ads on the platform, particularly pre-roll ads, with 60 per cent noticing pre-rolls.

The majority of those users also interacted with ads and nearly one-fifth of users (19 per cent) subsequently purchased a product as a result of an ad they’ve seen on connected TV.

“It reminds me very much of the early days of the internet, when users weren’t yet bombarded with ads and engagement and ad recall were much higher,” he said.

Users of connected TVs also seemed willing to watch ads in exchange for getting free content. “For TV length content, they would rather see ads than pay for the content,” he noted. In contrast movie viewers were much more willing to accept subscription or PPV models.

Overall, 59 per cent of viewers of short-form video on connected TVs and 44 per cent of those streaming TV shows preferred viewing 15-30 second ads over monthly subscription or the pay-per-view model. For movies, however, more than 6 in 10 users preferred either subscription or PPV models over ad-supported viewing.

While some analysts have argued that connected TVs could hurt traditional multichannel providers, the survey found little evidence of that. “There was not a lot of evidence of cord cutting,” Hockersmith said.

Like other surveys on this topic, the study found that game consoles were the most popular way to connected TVs, with 77 per cent of connected TVs connected to a game console, 34 per cent connected to a Blu-ray player, 28 per cent being a smart TV with an internal internet connection and 25 per cent hooking up a streaming device or set-top-box.

The numbers total to more than 100 per cent because many homes connected their TVs to more than one device.

The living room was the most popular room to have a connected TV, with 52 per cent reporting they had a TV hooked up to the internet in the living room, followed by the bedroom (47 per cent) and the family room (29 per cent).

The most popular connected TV apps were Netflix (with 52 per cent saying they used the service), followed by YouTube (47 per cent), Hulu (28 per cent) and Amazon (19 per cent).

Overall the connected TV users were young and skewed male.

About 24 per cent of users viewed TV shows on networks several times a week, while 29 per cent watched TV shows streamed from the internet multiple times per week.

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