Uptake for connected devices is key for the spread of multiscreen TV use: a large embedded base of connectable devices for use in association with TV viewing is a bit of a prerequisite. Good news on that front, says MRG, which predicts that by the end of 2013 the installed base of tablets in the US will exceed 90 million devices.
And, the number of tablets in operation is expected to more than double within five years, while the installed base of Internet-connectable TVs is forecast to triple in size, according to MRG. http://www.mrgco.com/reports/the-us-market-for-multiscreen-services/
By 2017, it's also anticipated that more than 80% of all US mobile subscribers will own a smartphone. In all, the installed base of connected devices will exceed half a billion units.
The term 'multiscreen video' typically refers to the viewing of video content on multiple screens, such as a smartphone, tablet or personal computer. There is general consensus that this will be a growing, long-term trend. In contrast, the multiscreen TV experience is defined as the use of a companion device/screen in association with discovering, acquiring and viewing full-length video content (movies/TV programmes) on the in-home television. While a single device, such as a tablet, may serve as both a companion device for the TV and a first-screen viewing device, the two use-cases are separate and distinct.
And multiscreen TV use has a few remaining obstacles. For one, consumer behaviour weighs heavily on multiscreen usage, the firm pointed out. "Simply owning a connectable device does not imply changes in consumer behaviour," it said in the research. "Connected devices, technology, video services, consumer demand and business models all evolve at different rates. In some cases, technology can be out in front of consumer behaviour by five years, or more. By the time consumer demand catches up, a given technology may be antiquated and nearly forgotten."
Incumbent suppliers can also impose formidable barriers to change, especially when their business models are threatened and/or disrupted. So, a significant prerequisite for the multiscreen TV market that is not in place yet is a complementary business model. Pay-TV service providers have long employed a business model focused on upselling. New technology is bundled into the top-of-the-line service packages to increase average revenue per user (ARPU). With regard to personalised video services, pay-TV operators prefer to maximise revenue with lower subscriber penetration rather than promoting mass adoption of a free enhancement. This makes good business sense, but it does not help raise the overall value proposition for pay-TV service.
There are a number of other prerequisites needed for the US multiscreen TV market to take hold. These include:
• A large installed base of connected/connectable devices
• Personalised recommendation systems and companion app technology
• The rollout of initial personalized video services
• Consumer interest in TV multi-tasking
• A complementary pay-TV business model
That said, market conditions surrounding the emerging multiscreen TV experience are right for a perfect storm to be created, MRG noted: "If so, we will be entering the next-generation of TV viewing where multiple devices, services and video content will combine to create a truly personalised entertainment experience."
It added: "Occasionally, all of these market elements align, like a perfect storm. In these instances, where technology, devices, services, consumer demand and business models become synchronised around a specific use model, or solution, the market can change very rapidly."