What Viewers Really Want

Will the Recession Crimp an Insatiable Appetite for Video?

By MCN Staff -- Multichannel News, 1/2/2012 12:01:00 AM

If there were a spot market for video futures, 2012 would seem to be the year to invest. Television ad projections for 2012 are robust — thanks to the quadrennial bounce from the presidential election and Summer Olympics — and consumer trends promise even greater demand for high-quality video in the years ahead.


It has been less than two years since Apple announced the first iPad on Jan. 27, 2010, yet investment bank J.P. Morgan expects nearly 100 million of the tablets to be sold worldwide in 2012, and eMarketer forecasts that nearly 55 million Americans will use an iPad at least once a month this year. Not surprisingly, it is hard to find a major operator or programmer that has not launched some kind of tablet or mobile application.

Yet behind a wave of consumer buying lie some dangerous eddies. As financial markets continue to fluctuate, the recovery from the worst recession to hit the U.S. economy since 1948 has been slow. Unemployment rates are higher than they’ve been in decades, and that has has encouraged some consumers to reduce spending on multichannel TV. Plus, the housing market is still in a deep funk, which means fewer new homes are hooking up to cable.

How some of those economic realities are interacting with the hockey-stick consumer trends in video consumption is a major theme of Multichannel News’ Viewer Watch 2012 report. Consumers certainly want to access video on any device, anywhere, at any time. That directive is so strong it has almost become a cliché.

But who is going to pay to prepare and deliver that content? How can operators and programmers cover those costs and continue to build their businesses in a period when cash-strapped consumers are unlikely to accept hefty increases to their pay TV bills? What are some of the most promising new revenue opportunities?

There are no simple answers to those questions, but this year’s Viewer Watch is once again designed to help readers better understand the issues with data and analysis.

Much of the focus is on the future, with charts providing projections for a wide variety of multichannel, ondemand and digital services and two stories looking at the big trends facing the industry in 2012 and beyond. But this report is also designed to provide readers a sense of where the industry is today, with data on penetration for a wide array of consumer electronic devices and ratings for top ad-supported networks.

Among the research organizations that were particularly helpful in providing data, we’d like to thank Horowitz Associates, PricewaterhouseCoopers, Nielsen, Fox Cable Networks, which compiled some Nielsen ratings data for this report, and Turner Broadcasting System, which provided some original analysis of the impact of over-the-top video and other trends. Contributing writer George Winslow compiled the data, conducted the interviews and wrote the articles.