More than half (52 percent) of American consumers would switch pay TV services if they could get a better price for the same channel selection, a new study finds.
According to a new report — IPTV: Simple Benefits, Not New Technology, Most Effectively Compete Against Cable by JupiterResearch — following cheaper prices, the option of à la carte channel selection proved the second strongest motivator for switching pay TV services, attracting 46 percent of consumers.
The study found little interest in high-definition programming, with only six percent of consumers considering it a priority. And only three percent of viewers are attracted to a greater selection of video-on-demand services.
“While Internet Protocol TV proponents get caught up in the futuristic possibilities of the technology, consumers remain much more levelheaded about what they look for in a TV service,” said Joseph Laszlo, research director at JupiterResearch and author of the report. “Competitors looking to deploy IPTV should avoid overwhelming the consumer with Jetsons-like ‘TV of the future’ and focus, instead, on delivering real value in terms of TV of the present.”
According to the JupiterResearch report, potential new entrants to the U.S. TV market face enormous challenges in undertaking billions of dollars in investment to build out infrastructure and design services capable of attracting subscribers in a saturated market. Sixty six percent of current pay TV subscribers are satisfied with their service and will require aggressive pricing, better channel selection or other clear benefits to induce switching.
However, the millions of customers using cable-provided phone services create a threat to phone companies’ core business and leave them with little choice but to match cable’s triple-play bundle of voice, television and Internet services.
“Although à la carte channel selection is highly feasible over an IPTV infrastructure, the business case remains uncertain, and media companies are likely to resist such service plans,” said David Schatsky, senior vice president of research at JupiterResearch. “To address à la carte popularity, IPTV services should focus on giving consumers greater choice and control over their television experience, if not true à la carte.”
For more information, visit www.jupiterresearch.com.
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