Digital Television Trends
surveys in the UK and US reveal public demand for quality
and choice in digital TV.
viewers expect digital TV to provide better quality
pictures and sound along with more choices in TV content.
They also would prefer to shop from home on a TV rather
than on a computer.
That's the state of
the marketplace according to the 2001 Pace Report, a
Gallup survey of U.S. adults expressing their views about
digital cable television. Commissioned by Pace Micro
Technology, the UK-based digital set-top manufacturer,
the survey findings provide a taste of the American
appetite for interactive TV.
commissioned the Gallup Organization to produce a Pace
Report for the UK in 1997. The findings educated
operators on the types of digital services to offer TV
customers, says Pace, showing what would cause analog
viewers to go digital. The UK and western Europe
currently lead the world in interactive TV
U.S. surveys for the 2001 Pace Report last October and
November through phone interviews with a national
sampling of 1,000 adults. Gallup allows for survey
sampling errors of 5 percent.
Comparing the U.S.
and UK results unveils critical similarities and
differences in the two markets.
What were the key
findings of the Pace Report for the USA?
The digital TV
features most likely to appeal to consumers are topped at
27 percent for better quality sound and pictures, 24
percent for a greater choice of channels, and 22 percent
for more choice in types of programming.
"T-commerce," like "e-commerce" on a computer but on a
television screen, two-thirds told Gallup they would
consider buying books, CDs, DVDs, vacations, and movie or
theater tickets over their computer or television.
Further, 41 percent actually have purchased goods or
services through a television or a computer -- 25 percent
using a PC, 10 percent using a TV, and 6 percent using
Here's a telling
point: Slightly more than one in four, 27 percent, said
they would prefer to shop at home using their television
rather than using their computer.
As for types of
T-commerce, 75 percent would be interested in
pay-per-view movies and other forms of video on-demand,
56 percent would be interested in educational
programming, 50 percent in live music events, and 50
percent in sports events. More women than men said they'd
prefer using the television for home shopping.
general audience preferences among the sample, 34 percent
watch news and current affairs programs, 29 percent
sports, 23 percent comedy, 23 percent movie channels, and
21 percent watch general entertainment
implementation of the U.S. OpenCable hardware and OCAP
software standards are a chief cause for delays in
deploying digital cable TV, Wallace says. Satellite and
digital terrestrial deployments are advancing as rapidly
as technology and public acceptance allows.
"Europe is a more
cohesive, heterogeneous market based on DVB," says
Wallace, "yet I see no reason for the U.S. to adopt DVB
for the sake of having one unified global standard. If
the U.S. is open and progressive, do we really need unity
for unity's sake?"
Compare the U.S
findings with key results from the UK survey.
About a quarter, 28
percent, said they receive digital television services --
more than double the 13 percent figure from the 2000
survey. One percent of UK households receive no
television at all.
As their reason for
adopting digital television, apart from the Crown
switching off analog TV, 51 percent cited better quality
sound and pictures, 43 percent cited more movie channels,
and 40 percent cited a greater choice in types of
About a quarter of
the respondents, 23 percent, reported having actually
used either a computer or digital television to buy goods
or services, half of them buying holidays ahead of any
Among this group,
77 percent have done transactions by computer, and 23
percent by TV, which includes Teletext.
While 37 percent
said they'd prefer using a computer for home shopping, 32
percent said they'd prefer using a digital TV, and 22 per
cent in the UK said they would use neither for their
A year ago, 23
percent reported accessing the Internet at home. A year
later, the number has jumped to 42 percent. Of these,
only 6 percent used a digital TV for Internet access.
Internet access on a digital TV has been available in the
UK for less than a year.
As for types of
T-commerce, 71 percent told Gallup they were likely to
request pay-per-view movies. Surprisingly, 57 percent
said they were willing to pay for news and current
affairs programming, more than those willing to pay for
music or sports.
preferences, 43 percent watch news and current affairs,
42 percent movies, 36 percent sports, 36 percent general
entertainment channels, and 33 percent watch music and
What can be deduced
from the findings of the Pace Reports for the U.S. and
come from Andrew Wallace, senior VP for worldwide
marketing at Pace Micro Technology. "The main trend for
the UK is a willingness to buy digital television
services that continues to grow."
Wallace spots two
important UK market trends.
"The increase in
the UK is being driven by high levels of competition for
interactive TV services over cable, satellite, digital
terrestrial, DSL, and even wireless," he said. "Because
of aggressive marketing and improved interactive content,
more people who do not have digital TV are now thinking
seriously about getting it."
Second, he says,
"Many more people want to do home shopping on the TV than
the PC, and a reason is that 75 percent of the homes in
the UK do not have Internet access. A computer is more
complicated and expensive than a TV, so there's more
openness to the TV."
American trends for
digital TV are influenced by the fact 41 percent of all
U.S. TV households now contain a computer, Wallace says,
"but there's disproportionate popularity in both the U.S.
and the UK for transactions driven by the simplicity and
comfort zone of TV."
"In the States," he
says, "there are promising signs of a maturing market as
'couch commerce' takes hold, but penetration percentages
in the U.S. will continue to lag behind the UK for some
adopted interactive TV and T-commerce without getting
into the infrastructure issues that we have in the U.S.,"
says Jim Stroud, interactive TV analyst at The Carmel
Group. "That's why America will always be 18 to 24 months
behind the UK and western Europe, at least for the
"The 2001 Pace
Report shows us what we already knew," he says, "that
consumers want better quality sound and pictures, and
that consumers value greater choice in channels and
programming, even if they don't always take advantage of
all their choices, like mostly watching just ten channels
out of the hundreds available."
Stoud is intrigued
by what's missing from the 2001 Pace Report. "I'd like to
know how happy consumers are with the digital TV services
they're now getting. I'd also like to see some
pricepoints, whether products and services must be
subsidized. Consumers want to get interactive services
over the TV, but how much are they willing to pay for
He adds, "In the
UK, recent generations grew up interacting with the TV
using Teletext. Here in the States, recent generations
have grown up interacting with the computer. Since TV has
been such a passive medium here, we can't tell exactly
what to expect here from a mass launch of interactive TV
services. If there's consumer confusion, will the
customer service and technical support systems be in
place to help U.S. consumers take full advantage of the
The UK is generally
ahead of the U.S. in customer relations, he says. "In the
U.S. we hear over and over about consumers being unhappy
with the quality of customer care they get from cable
companies. So, what will happen as cable launches new
services that they don't yet have much experience in
offering? We'll have to wait and see."