Nielsen Report Cross Platform Report Q4 2011: What You Need To Know

Nielsen recently released its Cross Platform Report for Q4 2011. It has some excellent data on US households. David Dines distills the key points for executives who are concerned with service provider video infrastructure, STBs and other developments such as over the top and multiscreen video/TV everywhere.

Internet viewing of video is increasing but not as much as you think, only 4% y-y. Mobile video viewing, on the other hand, grew 36%. This is particularly important for mobile operators that are already talking about data congestion on their networks.

US TV households continue to shift away from cable, which were down over 1% sequentially and nearly 5% year over year. Telco TV grew 15% and satellite was almost flat for the year. This is likely to be indicative of the rest of the world because most of the new competition is from build-outs by Telcos, specifically, FTTH in developing economies such as China. 

	Q4 10	Q3 11	Q4 11	Q-Q Change	Y-Y Change
Broadcast Only	11,147	11,050	11,043	-0.1%	-0.9%
Wired Cable	63,393	61,192	60,473	-1.2%	-4.6%
Telco	7,339	8,284	8,452	2.0%	15.2%
Satellite	34,273	34,653	34,553	-0.3%	0.8%
Total TV HHs	116,152	115,179	114,521	-0.6%	-1.4%

Source: Nielsen

Additional data from Nielsen also points to increasing cord cutting behavior. The number of households that use broadcast TV (no pay TV) with a broadband Internet connection rose 14% y-y to 5.1M; cable only (no broadband) declined nearly 13% y-y to 22.4M households. Cable and broadband customers held nearly steady, growing 1% y-y but down 2% sequentially. 

Cable/Satellite	Q4 10	Q3 11	Q4 11	Q-Q Change	Y-Y Change
Broadcast Only and Broadband	4,491	5,104	5,122	0.35%	14.1%
Broadcast Only and No Internet/Narrowband	6,130	5,869	5,911	0.72%	-3.6%
Cable and Broadband	78,525	80,824	79,238	-1.96%	0.9%
Cable and No Internet/Narrowband	25,610	22,329	22,381	0.23%	-12.6%
All	114,756	114,126	112,652	-1.29%	-1.8%

Source: Nielsen

Overall, these two indicators (the continued loss of cable subs and the increasing number of people with no cable but with broadband) are reinforcing our assertion (from two years ago) that OTT was a real potential threat to pay TV services. Even without the same quality, the price and convenience make OTT a credible substitution, especially among the Millennial group, tech savvy or cost-sensitive households.  Now that many of the quality problems have been solved with adaptive streaming and the immense popularity of tablets, SPs need to pay attention to consumers' behaviors. They need to be looking toward innovative services and bundling because “me too” types of services will not likely keep consumers’ interests for very long.

For more information about ACG Research's Video Infrastructure service, click here or contact sales@acgresearch.net.

David Dines

ddines@acgresearch.net

www.acgresearch.net