NPD: People Want Internet-Connected TVs

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Despite all of the hype 3D television received over the past year, consumers are looking to a different technology to take their television viewing to a new level: Internet connectivity.

According to The NPD Group, sales of Internet-connected television sets increased 38% between January and November 2010, compared with the same period for the previous year. Such sets now account for 12% of all flat-panel sales. Furthermore, nearly half (45%) of consumers who have a connected television have used their sets to access the Internet. Of these, more than half (57%) say they are very satisfied with the features of their sets.

"What we've seen is a large array of content become available for connected television," Ross Rubin, director of industry analysis at NPD, tells Marketing Daily. "Even though more could be done to ease the set-up process, [Internet connected TV] isn't as big an ecosystem [challenge] as the one 3D TV faces."

Part of that may be because consumers have become accustomed to viewing and using Internet-available content on their computers. Of the consumers who have connected TV, more than half (57%) use it to access Netflix, while 47% are watching videos on YouTube. Other content sites -- such as Hulu Plus and Pandora -- are also gaining steam among consumers, Rubin says.

"A lot of these services were already available on PCs and the key was to create a TV experience to access," Rubin says. "It's not about the Internet, per se. It's about what the Internet can deliver. It has given rise to new entertainment and on-demand experience. Consumers are looking for that to supplement what they already have from cable and satellite providers."

Still, much of what consumers are looking for on the Internet is heavily dependent upon what the TV manufacturers are willing to include with their sets. Further development of open-source platforms such as GoogleTV and Boxee, however, should open up more of the Internet experience as viewed through a TV set.

"It really opens the door to the developer community and building applications that can work across devices," Rubin says. "What many [consumers] would like to see is to search across all that programming and aggregate it through a single user interface, to tie in that wealth of content."

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