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Report: 38% of U.S. Households Have Connected TVs

10 Apr, 2012 By: Erik Gruenwedel

Netflix remains the primary driver of users seeking Internet-connected media devices to the television

Nearly one in four households in the country have a least one television connected to the Internet directly or via a video game system, Blu-ray Disc player, Apple TV or Roku set-top player, among other devices, according to a new report.

Leichtman Research Group said household connected TV penetration is up 8% from 30% penetration in 2011 and 25% penetration in 2010. The primary conduit remains the game console, at 28%, while just 4% of households are connected via Web-enabled TV, and just 1% through an Apple TV or Roku media player.

The data was compiled from a survey of 1,251 households nationwide.

The Durham, N.H.-based research firm said 13% of all respondents watch video from the Internet via a connected device at least weekly, compared with 10% last year and 5% two years ago. Use of connected devices remains skewed toward Netflix subscribers, with 35% of Netflix subscribers watching video from the Internet via a connected device weekly, compared with 5% weekly use among all non-Netflix subscribers.

Indeed, 16% of all adults use Netflix’s streaming feature weekly — compared with 12% last year and 4% two years ago. Nearly 80% of Netflix streaming customers use it to watch movies and television shows on a TV set, and 59% of this group access Netflix via a video game system.

About 50% of Netflix subscribers are satisfied with the service, and 11% are likely to stop subscribing to Netflix in the next six months. Another 7% of Netflix subs are likely to switch from their multi-channel video provider in the next six months — compared with 12% of non-Netflix subscribers.

About 13% of Netflix subs would consider reducing spending on their multichannel video service because of Netflix — compared with 21% last year.

Another 16% of all adults watch full-length TV shows online at least weekly, compared with 12% last year and 10% three years ago. Among all mobile phone owners, 19% watch video on their phones weekly, compared with 15% last year, and 6% three years ago. And 9% of all adults watch video on an iPad/tablet computer weekly, versus 2% last year, according to the report.

Overall, 1.6% of households in the sample paid to subscribe to a multichannel video service in the past year and do not currently subscribe. Yet, just 0.1% of the sample who dropped service in the past year do not plan to subscribe again in the next six months and say that they don’t subscribe because of Netflix or because they can watch all that they want on the Internet or in other ways.

“Video is increasingly being watched on different platforms and in different places, yet these emerging video services still generally act as complements to traditional television viewing and services rather than as substitutes,” said Bruce Leichtman, president and principal analyst for Leichtman Research Group. “Among all adults, reported time spent watching TV is similar to last year, and there remains little evidence of a significant trend in consumers ‘cutting the cord’ to their multichannel video services to watch video solely via these emerging services.”

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