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Originally featured on BroadcastEngineering.com
Apr 6

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4/6/2012 7:22 AM  RssIcon

Roughly 31 percent of U.S. broadband households now regularly watch TV programs or movies accessed from the Internet on their TVs, according to Park Associates, a marketing research company.

Kurt Sherf, vice president and principal analyst at Parks Associates, said that IP-based, ondemand services have achieved broad appeal among multiple consumer segments.

Growing sales of video receivers such as Apple TV and Roku in the 2011 holiday season show a strong consumer appetite for Over-the-Top (OTT) video, the firm said.

Sales of digital video media receivers were strong in the recent holiday season, with penetration approaching 13 percent of U.S. broadband households and matching the 2011 forecasts from the research firm. Parks forecasts over 14 million units will sell in 2012.

These strong device sales indicate increasing consumer interest in nontraditional approaches to video access. “In the 2011 holiday season, four percent of households bought one of these inexpensive, single-function devices, which enable households to view over-the-top (OTT) video from Internet-based services such as Amazon Prime Instant Video and Netflix,” said Kurt Sherf, VP, principal analyst, Parks Associates.

“Nearly 20 percent of these holiday-season buyers are over 45 years of age, so these devices have achieved relatively broad appeal among multiple consumer segments.”

Apple reported 2.8 million unit sales of Apple TV in its fiscal 2011 and another 1.4 million coming in the holiday quarter. Roku also enjoyed a solid 2011, with 1.5 million sales.

“While this trend does not yet frequently equate to canceling pay-TV services, it can mean shaving some premium channels for a set of households,” Scherf said. “That is a risk that pay-TV providers must address and a trend that both manufacturers and content providers are following with eagle eyes and plans for defensive actions.”

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