Internet-Connected TV Scores With Netflix Users

by , Apr 19, 2011, 12:42 PM
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Although more U.S. homes have Internet-connected TVs, watching online video on TV is still a small entertainment activity -- unless your name is Netflix.

The Leichtman Research Group says that although 30% of U.S. homes now have an Internet-connected TV -- via a video game system, a Blu-ray player, and/or the TV set itself -- only 10% of those viewers are actually watching video weekly. This video activity is double what it was a year ago.

But among those Net-connected TV homes that have Netflix, video weekly activity climbs to 30%. Taking Netflix out of the mix, only 3% of Net-connected TV homes watch some video weekly.

Netflix's Watch Instantly service now reaches 12% of adults weekly, according to Leichtman -- that's three times the number of a year ago. Three-quarters of that group uses it to watch streaming TV shows and movies on their television sets. and 60% access Netflix via a video game system.

Video games are a major attraction for homes with Internet TVs -- 23% have a video game console attached, and 7% have Blu-ray players. Fifteen percent of mobile phone owners watch video on their phones at least weekly -- compared to 10% last year, and 6% two years ago, according to Leichtman.

Looking at the traditional multichannel video business, the survey says 20% of those subscribers are likely to reduce spending for those services over the next six months. But it notes that Netflix subscribers, online video users and premium subscribers are as likely as others to reduce spending as well.

Cord-cutting? There won't be much of it.

Overall, 0.3% of the Leichtman survey sample dropped a multichannel video service in the past year and do not plan to subscribe again in the next six months. But it wasn't only because of the Internet -- many say they would have dropped services anyway to save money.

Bruce Leichtman, president and principal analyst for Leichtman Research Group, stated: "Even with this growth in emerging video services, this isn't creating a significant trend in consumers cutting the cord to multichannel video services -- including cable, satellite and Telco video services."

1 comment on "Internet-Connected TV Scores With Netflix Users".

  1. Doug Garnett from Atomic Direct
    commented on: April 20, 2011 at 1:01 p.m.

    Great research, Wayne.

    So NetFlix is clearly replacing the video store. And, in the process, probably increasing the amount of old video watched.

    But at the core, "TV viewing", which I would have always separated from DVD watching, isn't heavily affected by this yet.

    Makes sense. Suggests that there will be change. And the change will be bigger than many want, but dramatically smaller than the revolutionizers want.

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