• by Jack Loechner , Staff Writer @mp_research, July 8, 2002

The newest Horowitz Associates, Inc. study on the market for digital and interactive television services shows that consumers are pleased with the digital service they are currently getting and are increasingly bullish for more/better features of digital and interactive television.

Satisfaction with digital cable is high among current digital subscribers, with 29% stating that the service is better than their initial expectations, 55% saying the service is what they expected, and 12% indicating it is worse than expected. Subscribers say what they like most about the service is more/expanded channels (40%), better picture quality and reception (16%), and having an interactive program guide (11%). However, despite satisfaction with their service and interest in new features and channels, consumers are focused on value: a full 30% say what they like the least is the cost of the service.

This telephone survey of cable or satellite consumers in markets where digital cable service has been launched, shows that market potential for digital cable and satellite service continues to grow. Currently, 25% of consumers surveyed have digital cable service and 16% say they are likely to subscribe to digital cable service, bringing market potential for digital cable services to 41% in these markets.

Howard Horowitz, President of Horowitz Associates, says "The findings clearly demonstrate that the transition to the digital home is well underway. The issue facing the industry now is how to take digital television, and broadband in general, to the next level by delivering value to the consumer through improved digital content, expanded digital features, more robust technology and better customer service. One in ten (10%) consumers surveyed say they used to, but no longer, subscribe to digital cable service, and among current digital subscribers, 16% do not think digital cable service offers value for the money spent.

Consumers point out which features would increase their likelihood to subscribe to digital services or add value to their existing service. The most popular features are "video on demand service: older movies at $1.00 - $2.00 per movie" and "video on demand at $3.95 per movie" with two-fifths of the consumers interviewed (43% and 41%, respectively) saying it would increase their likelihood to subscribe or add value to their existing digital service. Consumers in the market for digital services also want to have instant message and email on their TV and access on demand to detailed information about programs or advertising they are watching.
HorowitzAssociates June 2002