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Connected devices thrive on content experience

Posted: 01 Dec 2011     Print Version  Bookmark and Share

Keywords:Internet TV  connected device  online video 

Internet-connected devices will see a surge in household penetration among consumers in the U.S., Europe and Asia, according to Bain & Co. Inc. in its latest study titled "Connected Devices and Services: Reinventing Content."

A solid consumer interest in new content experience on these devices is driving the anticipated growth, noted the consulting firm. However, while consumers are inclined to increase their adoption of online content for video consumption, video games, live entertainment and cultural activities, media companies and cultural institutions face stiff competition for incremental consumer spending. Bain added that this is the case unless new business models and 'ambitious content' are created.

Bain's survey of 3,000 consumers in France, the U.K., the U.S., China and India suggests that a high degree of consumer enthusiasm may have limited incremental profit potential for businesses unless new innovative ways for experiencing content are developed. "The permanent media revolution continues," stated Patrick Behar, lead author of the study from Bain. "But media and entertainment companies must pursue aggressive content development and diversification strategies to unlock new consumer spending."

According to Bain, the biggest shift in the connected content experience will come in video. Half of respondents in the U.S. and U.K. intend to rely more on search engines to find content, while one-third plans to use their network of friends to choose their favourite "must see TV." The latter figure jumps to 45 per cent for consumers in India and China, although lack of infrastructure will limit the ability of many to view video on connected devices, particularly in India. The company continued that fictional programming lends itself particularly well to such a transition and our increasing connectedness with the Internet could also accelerate the development of short formats born on the web. Both amateur and professional webisodes have attracted sizeable, albeit still limited, audiences online. About three-quarters of those surveyed in India and China expressed interest in webisodes.

Video games are fertile ground for creating innovative content experiences. Forty per cent of those surveyed in Western markets use a connected console or terminal and more than 60 per cent of the occasional players surveyed said that they were likely to increase their game playing. Yet a generation gap will remain amongst gamers—while 60 per cent of those under age 35 see themselves playing more on connected devices, fewer than 25 per cent of those older than 55 agree.

Other cultural and entertainment activities, such as live entertainment and visual arts, currently have limited online options. While nearly two-thirds of Western consumers expressed strong interest in connected cultural experiences, less than one-third envision spending more time on such activities. Many live performances attract only small niche audiences that restrict the availability of options that can be produced profitably. Along similar lines, three-quarters of those planning to visit museums more frequently due to connected content are regular visitors, whereas fewer than 18 per cent of non-visitors intend to allocate more time to cultural institutions due to connected experiences. That said, roughly four times as many people said that they were willing to pay for a smartphone/tablet application as an improved museum audio guide than those paying for a museum audio guide today.

"Significant change lies ahead for the media and entertainment industry as content platforms, new entrants and incumbents battle for profits and market share," concluded Behar.

For more statistics and forecasts, click here.





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