altman vilandrie & co. 2013 consumer video research excerpts
DESCRIPTION
These are key findings from Altman Vilandrie & Co's 2013 Consumer Video Research showcasing online video viewing adoption, attitudes toward pay-TV and cord-cutting, and millennials' use of broadcast TV.TRANSCRIPT
2013 Consumer Video Research Excerpts for VideoNuze
21 November 2013
21 November 2013 2 Confidential – Do Not Reproduce
Altman Vilandrie & Company
AV&Co. is the leading strategy firm focused on the Telecom, Media, and Tech sectors
Countries where AV&Co./Solon
has assisted clients
Background
Founded in 2002 in Boston
Led by 8 Directors and 8 Principals
80+ consultants in North America
Additional 40 consultants in Europe operating
as Solon Management Consulting
Value Proposition
Telecom, Media, & Technology (TMT) focus
results in better advice and speed
Fact-based, highly analytical, and
economics-based approach
Serve corporate and private equity clients
London Budapest New York
City Boston Munich
San
Francisco
Locations
21 November 2013 3 Confidential – Do Not Reproduce
AV&Co.’s 2013 Video Survey explores the transformation of consumer behavior in TV
show and movie watching
2013 AV&Co./Research Now Video Survey – Methodology and Approach
• Web survey conducted in
July, 2013—similar to
surveys done in summers
of 2010-2012
• Conducted in partnership
with Research Now, an
online panel provider
• Sample of 2,548
respondents (~500 in each
of 5 age bands) who are
video-decision makers for
their household
Survey Background
• Paid-TV subscribership – cord-cutters, cord-nevers,
cord shavers
• Online video usage – paid, ad-based, pirated
• Devices used to control and watch video
• Mobile viewing – location, devices, and rationale
• Interest in a la carte channel offers
• Attitudes toward live viewing, prerecorded shows, and
genres
• Multitasking and binge-watching
• TV Everywhere – awareness, usage, preferences
• Interest in an “add-on” service depending on brand,
price, content, live channels, and device availability
• Impact of Netflix offer and pricing scenarios
Sample Areas Explored
21 November 2013 4 Confidential – Do Not Reproduce
Online Viewing Adoption
Internet TV show/movie viewing is growing across all ages; younger consumers watch
online video more frequently, but older consumers had a large increase in 2013
How often do you watch TV shows/movies on the internet?
(% responding at least weekly)
Base: All respondents
Source: 2011, 2012 and 2013 AV&Co./Research Now Surveys; AV&Co. Analysis
62% 60%
45%
33%
24%
75% 72%
54%
37%
26%
81% 80%
68%
51%
36%
18-24 25-34 35-44 45-54 55+
2011
2012
2013
Age
21 November 2013 5 Confidential – Do Not Reproduce
53%
43%
39%
34%
30%
28%
24%
15%
14%
I can watch on my own timetable
I can easily get TV shows I want to watch
It saves me money overall
I can watch everywhere I go
I can get TV shows and movies I can't get anywhereelse
It lets me watch TV in rooms different from where theprimary household TV is located
It is easier to use than Pay-Per-View or Video-on-Demand services from a cable provider
It has a better recommendation system
The user interface is better than the cable TV
Drivers of Paid Online Video Adoption
Why do you use a paid internet video service?
(% selecting each option)
Viewing flexibility is a main driver of internet video service subscriptions, but almost
40% of online video subscribers report saving money as a motivating factor
Base: Respondents who use at least one paid internet video service
Source: 2013 AV&Co./Research Now Survey; AV&Co. Analysis
21 November 2013 6 Confidential – Do Not Reproduce
Paid Internet Viewing by Source
Do you watch TV shows and/or movies on these paid online video services
on a weekly basis?
(% of respondents who watch online video at least weekly)
Base: Respondents who watch online video at least weekly
Source: 2013 AV&Co./Research Now Survey; AV&Co. Analysis
Netflix dominates online video-watching among consumers who watch online video at
least weekly
Paid Online Video Service
76%
35% 33% 32% 32%
Netflix Instant HBO GO Hulu Plus Amazon Prime Paid on demandvideo services
21 November 2013 7 Confidential – Do Not Reproduce
Growth in multichannel video subscribers has not kept pace with TV household growth;
~4% of households are “new” non-subscribers who have emerged in the past 5 years
Multichannel TV Subscribers
Source: SNL Kagan, AV&Co. Analysis
98.9 101.7
11.1 11.9
4.4
2008 2013
Occupied TV Households
(millions)
110.0
118.0 “New” Non-Subscribers
“Traditional” Non-Subscribers
(held at 10%)
Multichannel TV
Subscribers 90%
10% 10%
86%
4%
Use antenna, watch DVDs only,
don’t care about video, etc.
Cable, Satellite, or Telco TV
• Historically, 90% of
occupied TV
households
subscribed to
multichannel TV
• Subscribers are now
at 86%— incremental
4% are “new” non-
subscribers
21 November 2013 8 Confidential – Do Not Reproduce
0.4%
1.5% 1.3%
3.4%
1.7%
4.9%
"True" Cord-Nevers "True" Cord-Cutter
Of non-subscribing households who “care about video,” the majority use online video at
least weekly
Multichannel TV Subscribers
* Range based on margin of error of survey
Source: 2012 and 2013 AV&Co./Research Now Surveys; AV&Co. Analysis
Other cord-cutters and
cord-nevers don’t watch
online video weekly (1.9%
of occupied TV households)
Composition of Multichannel TV Non-Subscribers Who “Care About Video”
(% of occupied TV households)
1.7%
4.9%
4.7% of occupied
TV households are
non-subscribers
who watch online
video at least
weekly
(never subscribed,
but care about video)
5.6-7.6%* of TV households are true cord-cutters or cord-nevers (care about video but who watch
video through other means); ~4-5% are driven at least partially by emergence of internet video
The number of cord-cutters and cord-nevers was approximately the same as in last year’s survey
(former subscribers who
care about video)
21 November 2013 9 Confidential – Do Not Reproduce
Price and value are the main reasons cord-cutters cancelled their subscriptions;
availability of internet video is the third largest driver
Cord-Cutters’ Reasons for Unsubscribing
Base: Cord-cutters who watch video through other means
Source: 2013 AV&Co./Research Now Survey; AV&Co. Analysis
To what extent were each of the following important in your decision to
"cut the cord", i.e., stop subscribing to a cable service?
(% of cord-cutters responding “important” and “very important”)
66%
53%
50%
42%
35%
31%
29%
27%
25%
I could no longer afford Cable TV
Cable TV was a poor value
Internet Video was enough for my needs
It was difficult to find good programs and/ormovies on cable TV
Basic Antenna Cable was enough for my needs
I didn't care about live TV (e.g., sports and news)
I didn't care about seeing TV shows as soon asthey were released
My cable TV Provider had poor service
I didn’t have enough time to watch shows or movies
21 November 2013 10 Confidential – Do Not Reproduce
74%
66%
59%
28%
19%
Live news is important to me
I want to watch TV shows as soon asthey are available
Live sports are important to me
I'm open to cancelling cable, but othersin my household want it
My internet connection is too slow forvideo
Current cable subscribers value access to live news and sports, as well as the ability to
watch new television shows as soon as they are available
Reasons for Maintaining a Cable TV Subscription
Base: Current cable TV subscribers
Source: 2013 AV&Co./Research Now Survey; AV&Co. Analysis
Why do you choose to subscribe to cable TV instead of relying only on internet
video for shows, movies, and other television programs?
(% of cable subscribers who agree with statements)
55+
Watching TV shows
when they become
available is especially
important to younger
cable subscribers
Age
76%
62%
Under 35
35+
21 November 2013 11 Confidential – Do Not Reproduce
Even with growing online alternatives, the level of TV watching during normal broadcast
time is roughly the same as in 2010
Broadcast TV Watching
How often do you watch shows on TV during their normal broadcast time?
(% viewing at least weekly)
Base: All Respondents
Source: 2010 and 2013 AV&Co./Research Now Survey; AV&Co. Analysis
65%
73%
80%
89% 85%
60%
72%
80% 84%
87%
18-24 25-34 35-44 45-54 55+
2010 2013
Age
21 November 2013 12 Confidential – Do Not Reproduce
Non-Subscriber Future Plans
What is the likelihood that you or your household will subscribe to cable TV
service five years from now?
(% of non-subscribers that responded “likely” or “very likely”)
Source: 2013 AV&Co./Research Now Survey; AV&Co. Analysis
36% of non-subscribers expect to subscribe to cable within 5 years, including almost
half of subscribers under 35
53%
46%
32% 33%
27%
18-24 25-34 35-44 45-54 55+
Age
21 November 2013 13 Confidential – Do Not Reproduce
9% 12% 7% 2% 1%
24% 29%
26%
14% 9%
18% 22%
16%
11% 8%
43%
51% 51%
36% 32%
18-24 25-34 35-44 45-54 55+
Tablet video consumption has more than doubled since 2011, driven by increased tablet
ownership; increased usage, especially among older consumers, has also contributed
TV Show/Movie Viewing on Tablets
How often do you watch TV shows and movies on a tablet?
(% viewing at least weekly)
Base: All Respondents
Source: 2011 & 2013 AV&Co./Research Now Survey; AV&Co. Analysis
Age
Tablet
Ownership 2011
2013
Watch TV shows
and movies on
tablet weekly 2011
2013
21 November 2013 14 Confidential – Do Not Reproduce
Smartphone TV show and movie watching nearly tripled from 2011 to 2013, driven
primarily by increased usage but also from growth in ownership
TV Show/Movie Viewing on Smartphones
How often do you watch TV shows and movies on a smartphone?
(% viewing at least weekly)
Base: All Respondents
Source: 2011 and 2013 AV&Co./Research Now Survey; AV&Co. Analysis
11% 13% 5%
3% 0%
28% 32%
20%
9% 4%
41%
48% 47% 43%
30%
66%
73%
68%
56%
40%
18-24 25-34 35-44 45-54 55+
Age
2011
2013
2011
2013
Watch TV shows
and movies on
smartphone weekly
Smartphone
Ownership
21 November 2013 15 Confidential – Do Not Reproduce
TV Everywhere Awareness by Age
TV Everywhere awareness has increased slightly over the past year, but younger
consumers are still more aware than older consumers
Does your cable TV subscription include access to TV Everywhere?
(% of subscribers with access to TV Everywhere)
Base: Cable TV subscribers with access to TV Everywhere
Source: 2012 and 2013 AV&Co./Research Now Survey; AV&Co. Analysis
50% 47%
35% 33% 24%
19% 21%
29% 36% 42%
32% 32% 37% 31% 34%
18-24 25-34 35-44 45-54 55+
2012
Yes Yes
No
Don’t
Know
Age
21 November 2013 16 Confidential – Do Not Reproduce
68% 70% 79%
85% 89%
32% 30% 21%
15% 11%
18-24 25-34 35-44 45-54 55+
A single app from
your cable TV
provider that gives
you access to all the
shows from channels
you subscribe to
82% of consumers prefer a single TV Everywhere app over separate apps for each
channel; younger consumers are more open to separate apps than older consumers
TV Everywhere App Preferences
If you were using TV Everywhere on your devices, which of these options would be
better for you?
(% of all cable subscribers)
Base: Cable TV subscribers
Source: 2013 AV&Co./Research Now Survey; AV&Co. Analysis
A separate app for
each channel you
subscribe to, each
giving you access to
TV shows from that
specific channel
Age