Studies Tackle DVR, VOD Usage

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Marketing conferences are a good time to release market research, and last week's Cable & Telecommunications Association for Marketing Summit was no exception. Studies released there — or timed to coincide with the conference — drilled into consumers' use of digital video recorders, video-on-demand, high-speed data and other timely topics.

DVR users increase their television viewing by 20% and watch more shows in the process, but fewer commercials wind up on their screens. Those were among the top-line findings from The DVR Monitor: WAVE IV, published by C Cubed and released at the start of the Summit here.

While flipping past commercials didn't rank highly among respondents asked why they bought a DVR or to describe its benefits to a friend, users nonetheless put that capability to the test.

"Commercial skipping is alive and well. The risk is not to accept that," C Cubed principal Jennifer Choate said at a tutorial titled "DVRs: Under the Microscope."

According to the study, DVR users said that when watching "live TV" they didn't screen any commercials 15% of the time. That ratio jumped to 64% among DVR users who recorded programming.

On a more positive note for the Madison Avenue community, close to 60% of respondents said they would always or frequently tune in ads if the spots are "funny," while 52% said they would always or frequently watch them if they are "interesting."

Survey respondents said their TV viewership averaged 20.8 hours weekly, 20% more than when they didn't have the service.

The survey also revealed that DVR owners watch more programs (42%) and more channels (41%) — findings that bucked conventional wisdom that had DVR users only recording and then tuning in their favorite programming, according to Choate.

"There are more opportunities for both programmers and advertisers," said Choate, noting that companies might do well to consider redirecting more direct marketing dollars toward the small screen.

Results were culled from phone interviews conducted in May with owners who use either stand-alone, cable- or satellite-enabled DVR equipment.

A 110-page report — including the first-ever questions concerning interactive TV, video-on-demand and pay-per-view — will be available in August. Choate said C Cubed counts more than 50 clients in the TV and entertainment industries.

Consumer research released last Monday indicates video-on-demand is becoming widely available and consumers have heard about it, but many subscribers in VOD-enabled systems don't realize they have it.

Leichtman Research Group did a telephone survey of 1,400 households in four VOD markets. LRG found that 90% of digital cable customers in the markets had heard of VOD, versus 68% of digital cable subscribers across the country.

But about one-quarter of digital subscribers — and half of analog customers — in the four markets didn't realize VOD was available to them.

Only about 30% of all digital cable customers in the four markets have used VOD. Usage rates among the four markets ranged from 27% to 45% of digital subscribers having tried VOD.

"VOD is now potentially available to nearly 40% of cable subscribers, yet making VOD available is just the first step in building the business," LRG president Bruce Leichtman, a former cable marketer, said in a statement. "Intensified marketing efforts, along with increased content offerings, will be significant factors in growing consumers' use and appreciation of VOD."

Broadband household penetration has more than trebled since 2001, according to the latest CTAM Pulse research.

Findings from CTAM's Consumer Profiles: A Moment in Time
indicate that household penetration of broadband has jumped to 16% this year from 5% in 2001. Among broadband users, cable modems remain far and away the connective choice as 63% of survey respondents use the device, a ratio consistent with the previous two years' results.

Penetration of online users seems to have crested, according to Pulse. Cable homes with online services decreased to 57% from 58% in 2002, after jumping from 51% in 2001. In satellite homes, online services declined to 56% from 64% a year ago, following a move to 52% in 2001.

Elsewhere, the survey revealed that digital cable is becoming increasingly popular. Penetration rose to 19% this year from 12% in 2001. Among cable households, 29% currently have digital services. All told, 66% of all U.S. households receive their programming via cable, versus 20% for direct-broadcast satellite providers.

From a demographic perspective, the profile of cable customers largely approximates the total adult population.

But digital-cable customers tend to be younger (average 40 vs. 45 for the total population), are more likely to have kids at home (53% vs. 39%) and have higher household income ($55,000 vs. $50,000).

The CTAM study posits that broadband users are even more attractive from various demographic measures: married (70% vs. 56%); education (39% are college graduates compared to 23% for the general populace); and affluence ($69,000 average household income vs. $50,000).

The research was based on a telephone survey conducted by Communications, Entertainment and Technology Research and Information Service as part of CTAM's Access survey from May 21 to May 30. The sample base represented 1,018 randomly selected consumers 18 and older.

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