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Survey: Connected-TV Users Prefer Ad-Supported Over Subscription, PPV

28 Aug, 2012 By: Chris Tribbey, Erik Gruenwedel

Survey found that 34% of viewers connect to the Web through a Blu-ray Disc player

Connected-TV owners prefer ad-supported video content over subscriptions and PPV, according to a new survey.

About 60% of connected TV consumers said they would opt for free, ad-supported content, while among people streaming movies and TV shows, the split is around 50%, according to a white paper survey compiled by Frank N. Magid Assoc. on behalf of YuMe, an online marketing company.

The survey — including data collected between May 24 and June 4, 2012 from an online field of 736 connected TV viewers between 18 to 54 years of age — found that more than 42% of respondents favored watching 15 to 30-second ads before an online TV show compared to 38% who preferred ad-free content via subscription video-on-demand.

Notably, about 42% of respondents watching online movies prefer SVOD services compared to 38% preferring ad spots.

More than 45% of users connect their TVs to the Internet via multiple devices, and 55% use a standalone game console, Blu-ray Disc player (34%), smart TV (28%), or media player/set-top box (25%).

About 31% of respondents stream movies from the Internet several times a month compared to 23% on a daily basis and 19% once a week. For TV shows, 29% stream episodic programming several times a month compared to 25% daily and 16% once a week.

Connected TV is an alternative way to watch TV shows and movies. Most viewers do this to relax (48%) when “there is nothing on TV” (49%). They also rely on connected TV to catch up on missed episodes (43%) of their favorite shows and watch a specific movie (40%), according to the survey.

The living room is the primary location (52%) of the connected TV followed by a bedroom (47%). Another 29% of respondents have a connected TV in the family room, followed by the master bedroom (28%) or other bedroom (19%).

Movie watchers are among the oldest viewers, according to the survey. They own laptops and desktop computers, and most have Blu-ray players. Their favorite leisure activities include listening to music, going to the movies, renting and streaming movies.

Meanwhile, more than 75% of respondents use apps more than 50% the time to view content. The most popular apps for watching video are Netflix and YouTube, with Hulu and Amazon Instant Video a distant third and fourth, respectively. While Netflix is overwhelmingly popular, the aforementioned results underscore the fact connected TV users do not want advertisements interfering with their viewing experience once it has begun.

Respondents connected to the Internet via game consoles, Blu-ray players, as well as streaming devices such as Roku, Apple TV, Boxee, or Smart TVs. The number of households connecting their TV screens to the Internet represents 30% of Internet-connected households, according to Magid.

The survey found that nearly 90% of respondents notice ads shown with video content, more than half of those interacted with the ads, and close to one-fifth purchased the product.

“We now have tremendous insight into consumer behaviors and preferences as they relate to connected TV at an unprecedented level of detail,” said Mike Vorhaus, president of Magid Advisors at Frank N. Magid Associates. “Advertisers and major brands will appreciate the rich findings for what is arguably the most explosive platform for video distribution and video advertising over the next several years.”

Roughly 30% of Internet-connected homes have some form of connected TV, according to the survey results, with 59% watching short-firm video content and 44% streaming TV shows. Connected TV owners skew toward young men.

“This study confirms that connected TV represents a tremendous advertising opportunity for brands looking to generate consumer awareness and meaningful interactions,” said Ed Haslam, SVP of marketing for YuMe. “In particular, the growth of short-form video content, and the willingness, even interest, of consumers to view advertising to view the content, speaks volumes about the opportunity here.”

About the Author: Chris Tribbey

About the Author: Erik Gruenwedel

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