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Report: Internet Video Drives Smart TV Usage in the U.S., But Not Europe

15 May, 2012 By: Erik Gruenwedel

In the United States, subscription video-on-demand services such as Netflix, Hulu Plus and Amazon Prime continue to migrate consumer interest toward Web-enabled TV, in Europe indifference reigns, according to a new Strategy Analytics report.

Indeed, sales of connected TVs are projected to exceed 200 million units in 2012. Yet the majority of consumers of smart TVs are not using the Web-enabled features.

In the United States, Strategy Analytics found that 34% of all smart TV owners are connecting at least once a week, and by far the most popular application is Netflix. Another 33% connect to the Internet through the TV less than once a week, 12% no longer connect and 22% never established Internet-connectivity.

In Europe 48% of smart TV owners are not using the connected capabilities of their TV at all. About 33% had never set up the device in the first place, and the remainder set it up initially but stopped using it, according to Strategy Analytics. Less than 10% of all European smart TV owners are using the connected capabilities regularly (at least weekly), and 43% connect to the Web on the TV less than once a week.

Most European markets lack a high-profile SVOD service like Netflix (even though BBC’s iPlayer figured prominently in Strategy Analytics’ U.K. sample). Los Gatos, Calif.-based Netflix is trying to up its presence, having recently entered the United Kingdom and Irish markets, and rumored to opening shop in Spain in the fourth quarter.

Amazon-owned LoveFilm Instant launched SVOD service last December. LoveFilm’s by-mail disc rental service has about 2 million subscribers in Western Europe.

“Once again our research has demonstrated that what most smart TV owners want is video,” SA analyst David Mercer wrote in a blog post. “If connected TV is to become more widely used manufacturers, content owners and emerging service providers must create compelling video services just as Netflix has done in the U.S.”

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