• by Joe Mandese  @mp_joemandese, November 3, 2006

Despite perceptions among advertisers and agencies that consumer are aggressively grabbing control of their media, new research suggests the average American is actually opting for convenience over control, and that the trend is actually driving the consolidation of media and telecommunications services into a handful of increasingly powerful media gatekeepers and packagers. The consolidation is being driven by a new form of consumer media convenience - one-stop-shopping - and aggressive price promotions by cable, satellite and telco operators adopting so-called "triple play" packages that seek to provide TV, broadband and telecommunications services under a single bill and at a competitive rate.

"They are the new gatekeepers into the home," says Dave Tice, vice president-client service at Knowledge Networks/SRI and director of its Home Technology Monitor, an ongoing tracking study that looks at the evolution of media technologies within the average American home. "Through new bundling strategies, they are becoming increasingly powerful and that is becoming an issue for advertisers and programmers, too."

According to KN/SRI's latest study, 22 percent of U.S. TV households now have at least one telecommunications service bundled as part of a package from their TV service provider, and Tice says that is expected to accelerate as the major telecommunications companies such as AT&T, Verizon and Sprint begin playing catch-up with the cable TV industry..

To date, cable operators have had a head start on telephone companies, and the KN/SRI data indicates that 90 percent of homes with bundled TV, Internet and telecommunications services are currently cable TV subscribers.

That's about to change, says Tice, as companies such as AT&T begin to aggressive market their U-verse package of bundled services. Interestingly, such bundles are not being driven by a desire to incorporate television access, which but by broadband Internet access. Nearly half (48%) of homes with broadband access have that service bundled with another TV or telecommunications service.

"Broadband Internet access seems to be driving this right now," says Tice, noting that according to KN/SRI's new data, broadband penetration rose 50 percent over the past year, and now stands at 37% of all U.S. homes, and 63% of all online homes.

The consolidation of bundled services raises many issues for advertisers, agencies and media content providers, says Tice, alluding to the debate surrounding so-called Net Neutrality, and the desire of some of the new gatekeepers to begin charging for access to previously free Internet sites.

Whatever the consequences, consumers seem to be gravitating toward more centralization of their media services, not the decentralization and personal control that pundits have been promoting over the past couple of years. Tice says the growing popularity of iPods and other personal media devices for managing media content may be the exception, not the rule. And their popularity may have more to do with a form of convenience - mobility - than it signals control.

In fact, the KN/SRI data suggests centralized media control devices are seeing very little uptake within the home. Microsoft's Media Center, for example, isn't even showing up in KN/SRI's sample households, and household media management remains diffused across digital TV set-top devices, DVRs, and computer hard-drives. Contrary to the push by consumer electronics and computer firms, consumers do not seem to want to centralize and control the flow of media content in their homes via a so-called media "concierge."

Apple, of course, hopes to change all that via its iTV platform, and TiVo has been introducing new generations of its technology designed to do the same. Tice also notes that AT&T's U-verse plan will integrate broadband connections directly into its subscribers' TV set-top boxes, enabling them to bring Web-based content directly onto their TV sets.

"People with stuff stored on the Internet, like photos, will be able to view them on their television, but right now the trend doesn't show that. It's the TV set-top vs. the PC hard drive," says Tice.

One other factor that may ultimately alter the management of media within the household, however, may be wireless. According to KN/SRI's latest data, 8% of Americans say they have a wi-fi network in their homes.