NPD: Consumers Sticking With Entertainment Subscriptions

Newspapers and magazines may not be faring so well in this economic climate, but consumers are holding onto their entertainment subscriptions, according to a new survey from The NPD Group. The research firm says that monthly per-capita entertainment-content subscription spending rose to $115, which is up roughly 7 percent since last year.
As of August 2009, 81 percent of U.S. households subscribe to a TV service (cable, satellite, etc.), NPD found. The company also discovered that 14 percent of consumers subscribed to a home video subscription service like Netflix (s NFLX), up two percentage points from last year. Additionally,  the increased smartphone adoption has bumped up the number of mobile data subscribers to 9 percent of U.S. consumers, up from 6 percent last year, NPD said.
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Today in Connected Consumer

Over at NewTeeVee, Jordan speculates about the possibility of a subscription video service from Apple.  I’m not as confident it will happen, given a few factors. First off, Jobs has stated his distaste for subscription services in the past, and its not clear he would embrace them for video. Even if he were to change his tune about an iTunes subscription, it’s unlikely big video players like NBC wouldn’t give Apple the rights to their content. Perhaps more important, consumers tend to like ad-supported or very cheap all-you-can-eat solutions like Netflix, so it’s quite possible an Apple $35 subscription service wouldn’t be as big a hit among end-users as some believe.

eMarketer: 188M Online Video Viewers in 2013

eMarketer projects the number of online video viewers in the U.S. will grow 31 percent in the next five years, hitting 188 million in 2013, up from 144 million in 2009. In addition, online video viewers will make up 85 percent of U.S. Internet users by 2013, and will achieve 59 percent penetration among the total U.S. population by then, the firm said in a report released today.
eMarketer_penetration
The findings are part of eMarketer’s “Video Content: A Premium Opportunity” report, which says that the drivers for this growth will be:

  • Improvements to the video stream quality, including HD
  • The expansion of content available through mobile platforms
  • More diverse content mix including TV shows, short form UGC and full-length movies
  • Movement towards clearer monetization models
  • Tighter integration between web-enabled devices and TVs

The whole world of online video is going through such a tectonic shift, it’s hard to predict exactly where it will net out. Yes, video quality is getting better and there are more premium content options than ever; but content providers and cable operators are looking at putting much of that content behind subscription walls. It’s possible that could actually reduce consumption. Between Time Warner’s (s TWX) TV Everywhere, Comcast (s CMSCA) OnDemand Online, Netflix (s NFLX), and a supposed Disney (s DIS) subscription service, premium content could choke off its audience before it’s fully realized.

How Many Content Subscriptions Do You Want?

Disney (s DIS) CEO Bob Iger told a tech conference crowd yesterday that his company is interested in putting up more content online, but it won’t be free, and it might require a subscription. From MediaWeek:

“The notion of going online at some point as a subscribe-to, robust entertainment experience is pretty attractive to us,” Iger said. “We are developing such an experience.”

Disney has been a mixed bag when it comes to accessing its content. Prior to Disney’s deal with Hulu, ABC shows were only available at ABC.com. ESPN 360 online video is only available to subscribers of participating ISPs. And Iger was against TV Everywhere-like services before he was for it (kinda).

There have been rumblings of a Disney-only Netflix-like (s NFLX) service for a while now. Granted, Iger didn’t provide any details on what such a service would look like, but will Disney’s desire for money blind it to people’s thirst for simplicity? In other words — how many subscriptions does Disney think people want?

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