Magnaglobal “On-Demand Quarterly” report is now called “Media Access Quarterly.” It continues to track Multichannel Video Subscriber, Internet Access, and DVR trends but they are also branching out to measure a range of consumer devices including Smart TVs, Connectable Game Consoles, Tablets, E-readers, smartphones and in-car technologies.
Their revised year-end 2016 forecast for DVR subscriber households now stands at 57.5 million (48.7% of TV households), revised down from 63.1 million in their 2011 forecast and compared to 41.2 million (35.5% of TV households) as of the end of the Q2 2011. The revisions were mainly based on evidence suggesting some maturation in the DVR market and economic pressure causing subscribers to contain their PayTV costs. The total number of DVR households was also negatively impacted by downward revisions to new household formation growth.
By 2016, they expect VOD, which includes Over-the-Top services – will reach 65.7 million households (approximately 55.7% of TV households). This compares with 54.8 million VOD households (46.9% of total TV households) at the end of the second quarter. As of the end of Q2, some 85.7 million homes – 72.4% of the total – were online; 91.0% of these homes accessed the internet using broadband services. Magnaglobal’s long-term internet access forecasts call for 97.1 million households to be online in 2016, of which 95.7 million will have broadband services.
DVR Subscriptions continue to grow in the US:
• Time Warner Cable’s DVR subscriptions dropped by 47,000 in Q2 (vs. 42,000 in Q1 and 47,000 in Q4 ‘10). Total DVR subscribers totaled 4.6 million at quarter’s end, 37.8% of the company’s subscriber base. Management noted several factors for the decline:
•Maturation of the product offering
•Some customers rolling off promotions that began last year including a Triple Play offer with a free period of DVR
•Some cash strapped customers targeting the DVR as the first service to cut
• DirecTV now has 9.9 million DVRs by our estimates, as 80% of new subscribers took either HD and/or DVR boxes during Q2. This compares to 8.0 million DVR subscribers at DISH Network. 53.5% of satellite subscribers now have DVRs.
• Meanwhile, Comcast added 132,000 advanced service customers during the quarter to reach 10.5 million. With 10.5 million HD and/or DVR subscribers, Comcast has some 6.1 million DVR subscribers – about 27.3% of the company’s total subscriber base.
• 56.0% of Charter’s digital subscribers have HD and/or DVR boxes. Penetration is lower at smaller market cable systems; we estimate only 20.1% of Charter’s subscriber base have DVRs as of 2Q11.
Cord Cutters and Cost Savers
Magnaglobal segments its model as:
1) Video Cord Cutters: Current PayTV subscribers who replaced their video viewing with OTT
2) Cost Savers: Homes who never had a PayTV subscription and are relying solely on OTT (or OTT plus Over-the-Air)
They believe 8% (8.9 million) of all TV homes will be OTT in 5 years
• 5 million will be Cost Savers (56%) and more than 60% of these will be Non-TV owning homes
• 4 million will be Video Cord Cutters (44%), up from only 455,000 in 2011 (15% of TV HH)
The Connected Home
• 70% of TV homes (81 million) have an HD set
• 2% are 3D capable
• 4% of those have built-in internet connectivity
• There are 6 million over-the-top boxes in US homes
• Half of the 79 million broadband homes have wireless access
• 75% of homes access the web via desktop or laptop
• Just over half of those do so with multiple computers
• 62 million game consoles are connected to the internet
• 10% of homes have at least one connectable appliance
The Connected Individual: 51% of adults (117 million) own a MP3 or music player
• 70% are iPods. There are about 100 million smart phones in use in the U.S. 20 million tablet computers are in the hands of Americans
• 75% are iPads 24 million eReaders have connectivity
• 55% are Kindles