TechTrends Publishes Study On Interactive TV Set-Top Box Demand

20-Nov-00

In a new study published by TechTrends, Inc., interactive TV (ITV) set-top boxes are expected to be very popular with a majority of consumers, but not at prices above $200, where most consumers lose interest. Product pricing will be the most important determinant of market success, since most digital set-top boxes that support Internet access, personal TV, digital video recording, video-on-demand, e-commerce and cable/satellite service will cost more than $200. But new research suggests that companies can improve their results by focusing on consumer segments that are less price sensitive.TechTrends' new study, ""Interactive TV And Home Control Set-Top Boxes: A Segmentation Analysis Of Consumer Demand, Price Sensitivity And Buying Intent,"" has identified heavy Internet usage, DBS service and simultaneous PC/TV usage as prime characteristics of consumers who are most interested in ITV set-top boxes.For example, the research reveals that DBS subscribers will pay more than premium cable subscribers for ITV set-top boxes. Among those who are interested, 25 percent of DBS subscribers will pay over $200, compared to 20 percent of premium cable subscribers. These results support TechTrends' earlier research, which found that satellite users are 50 percent more likely than cable users to subscribe to ITV services.The study also examines relationships between Internet usage behavior and buying interest. For instance, active online users are more than twice as likely as casual users to pay over $200 for an ITV set-top box. In addition, 60 percent of consumers who simultaneously access the Internet on their PC and watch TV are interested in ITV set-top boxes, compared to only 47 percent of users who engage in these activities separately.""Consumers who have the most exposure to TV programming and online content exhibit more interest and less price sensitivity than other consumers,"" said Adriana Weinfeld, Research Analyst. ""These consumers represent substantial opportunity for providers of ITV products and services.""TechTrends believes that these findings are encouraging for companies like DIRECTVÆ, AOL and Microsoft, who offer ITV services that combine DBS programming, Internet access and ITV applications. Leading consumer electronics manufacturers, such as Sony and Philips, will also likely benefit as cable operators expand their rollout of digital and interactive services. This subject is detailed in TechTrends' recently published report, ""Digital Cable Set-Top Boxes: North American Deployments In 2000-2001.""During the next few weeks, TechTrends will announce findings from ongoing studies that compare cable and satellite subscribers' interest and price sensitivity for e-commerce applications and ITV services.Published in November 2000 and priced at $795, ""Interactive TV And Home Control Set-Top Boxes: A Segmentation Analysis Of Consumer Demand, Price Sensitivity And Buying Intent"" examines how much consumers are willing to pay for digital set-top boxes that 1) enable a number of ITV applications, or 2) control household systems and appliances. The study also reveals which types of consumers prefer to rent set-top boxes, and which prefer to purchase set-top boxes online or at retail. The analysis segments consumers by 12 different variables, including demographics, TV set and set-top box ownership, types of TV service and Internet access, and TV and Internet usage behavior.For more information, visit www.techtrends.net.

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