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Broadband Transforms Television Viewing

Emerging Technologies Offer New Conveniences and Access on Multiple Devices

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The ability to record television shows and play them back later has greatly evolved from the early days of the video cassette recorder - or VCR. Back in the late 1970's the debate was limited to making a choice between Beta and VHS and reading complex instruction manuals to understand how to record a television show. Although the instructions were often considered complex, use of a VCR to record television shows enabled consumers to watch television shows when they wanted, and opened new markets for television and entertainment

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The conversion of broadcast television signals from analog to digital signals brought the convenience of digital video recorders (DVRs). Pressing a single button to record a show, being able to record an entire series, recording from a TV show directory, and fast forwarding commercials, were just some of the benefits made possible by the new technology. Digital television subscribers and DVR usage have steadily increased over the past several years. DVR recordings take up no physical space and have much better quality video and sound than their predecessors. In addition, capacity is limited only by the size of the storage device and the media it is saved on.

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As with the evolution of any technology, voracious consumer demand stimulated development of new devices with additional features, new devices, and convenient options. For example, the ability to record a show on one television, and watch it from other rooms in the home, or watching television shows on any device - including smartphones and iPads rapidly became a requirement in many households. TiVo took first generation digital recorders to a new level, by analyzing viewing behavior, and recommending television shows which matched customized behaviors.

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TV meets Broadband and the Internet

When digital video recorders (DVRs) and video on demand services (VOD) were first introduced, U.S. consumers flocked to the new technology. With expanded features including the ability to watch television on computers and portable devices, or sending signals to specific television sets in the house, this trend has been continuing. Many companies offer devices which allow broadband enabled customers to access and view television shows, movies, and online videos on their computers, televisions, and smartphones.

Devices Connect Televisions to Broadband

There are several devices which connect a television set to either a wireless or wired broadband connection. These include Roku, Apple TV for iTunes compatibility, and even video game consoles such as the Sony PlayStation 3 or Microsoft XBox.

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In April 2012 Leichtman Research Group (LRG ) published the results of a survey measuring the adoption of Internet connected televisions in the United States. According to the results of the survey, almost 40% of all U.S. households have at least one TV connected to the Internet - an increase from 10% in 2011, and 5% two years ago.

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Some of the highlights in the report:

  • Overall, 16% of all adults use Netflix’s Watch Instantly feature weekly — compared to 12% last year, and 4% two years ago
  • 79% of Netflix Watch Instantly customers use it to watch movies and television shows on a TV set, and 59% of this group access Netflix via a video game system
  • 50% of Netflix subscribers are satisfied with the service, and 11% are likely to stop subscribing to Netflix in the next six months
  • 7% of Netflix subscribers are likely to switch from their multichannel video provider in the next six months — compared to 12% of non-Netflix subscribers
  • 13% of Netflix subscribers would consider reducing spending on their multichannel video service because of Netflix — compared to 21% last year
  • 16% of all adults watch full length TV shows online at least weekly — compared to 12% last year, and 10% three years ago
  • Among all mobile phone owners, 19% watch video on their phones weekly — compared to 15% last year, and 6% three years ago
  • 9% of all adults watch video on an iPad/tablet computer weekly — compared to 2% last year
  • Overall, 1.6% of households in the sample paid to subscribe to a multichannel video service in the past year and do not currently subscribe. Yet, just 0.1% of the sample dropped service in the past year, do not plan to subscribe again in the next six months, and say that they don’t subscribe because of Netflix or because they can watch all that they want on the Internet or in other ways.

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Merging television broadcasting with broadband expands viewing flexibility, and makes entertainment choices much more convenient. Issues such as Digital Rights Management (DRM) and concerns over copyrights, as well as opposition from traditional television broadcasters will keep this issue in the spotlight, as expanded viewing capabilities and new devices are introduced.

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