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Consumers’ use of Digital TV - Summary of Oftel residential survey |
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Q2 August 2000 4. Reasons for not adopting digital TV and potential future usage
1.1 This report provides
an overview of the key findings in the digital TV market, taken from second
quarter 2000/01 of Oftel’s quarterly residential consumer survey
conducted in August 2000. Results from the first quarter (conducted in
May 2000 and a detailed follow-up survey in July) are used for comparison
purposes and referred to throughout this report.
Issues specific to the August survey include:
The July report (Consumers’ use of Digital TV, July 2000) provides additional information on:
(Footnote 1) This survey was conducted amongst a representative sample of UK adults, reflecting the UK profile of sex, age, social grade, region and employment status. Because the survey was conducted amongst a sample of adults, rather than the whole population, the data may be subject to a small margin of error. The error margin for the 455 digital TV homes is about 3-5%, but is higher amongst smaller subgroups. (Footnote 2) The report should not be seen as recommended best buys and should not therefore be relied upon when making purchase decisions. Oftel accepts no liability in respect of any of the results provided to it by MORI or any decisions taken by any person in reliance on the report. Uptake of digital TV 2.1 Since its launch towards the end of 1998, uptake of digital TV has been rapid. By August 2000, 21% of UK homes (about 5.25 million) claimed to have digital TV, an increase of about half a million since May 2000. 2.2 Over the last year, the profile of digital TV customers has changed, with an increasing number of older users and DE social grades. Although usage is still lower than average amongst these groups, generally uptake of digital TV is more evenly distributed across the population than for example Internet. 2.3 Most customers subscribe to digital pay TV packages. Only 3% of digital TV viewers said they don’t pay any subscription and watch the free to air channels only. Use of interactive services 2.4 Last quarter’s survey reported mainly traditional reasons driving adoption of digital TV, such as the wider choice of channels and programmes, rather than additional services such as Internet. During August at least 1 in 10 customers claimed to use Internet, email and on-line shopping, whilst on-line gaming was most popular, used by 28% of digital customers. Younger consumers tended to be making most use of these additional services. Last quarter’s survey found that the majority of users of these interactive services considered them good on speed, ease of use, range of functions, and security of transactions. Barriers to take up of digital TV 2.5 Barriers to take up of digital TV included lack of interest in additional channels and programmes (34%) and cost of equipment and subscription charges considered too expensive (28%). Cost was particularly an issue for the lower income groups. 2.6 13% of non-digital homes said they were likely to get digital TV services in the next 12 months, and was of particular interest to the younger age groups.
3.1 By August 2000, 21% of UK homes claimed to have digital TV. This equates to about 5.25 million, a growth of about half a million since May 2000, and is broadly in line with industry published subscriber numbers. This can be seen in figure 3a.
Who is using digital TV? 3.2 Figure 3b shows penetration of digital TV amongst UK consumers. Usage appears to be quite evenly distributed across most groups of consumers in terms of age (15-54), social grade (ABC) and income levels (over £17,500). Usage however, is still low amongst the lowest income groups and consumers over the age of 55 and uptake remains slow amongst these groups. 3.3 Figure 3b shows combined data from both the May and August surveys, for individual regions, to provide more robust sample sizes (minimum of 200 in each area) on which to base conclusions. Regionally, digital TV is most popular in Wales. This is consistent with a survey conducted by the Welsh Consumer Council in March 2000 which reported 20% of homes in Wales with digital TV. Digital TV remains popular in homes with other technologies, such as Internet access, 29% of whom claimed to also have digital TV.
Is the profile of digital TV customers changing? 3.4 Figure 3c shows the changing profile of digital TV users since June 1999 and compares this to the population profile. Since June 1999, distribution of digital TV usage has experienced a slight shift towards older users, and to a lesser extent the DE social groups. Although further change is required before becoming a more ubiquitous home product, digital TV usage is more evenly spread across the population than other technologies such as Internet (see Oftel’s ‘Consumers use of Internet’, August 2000 report).
What digital packages and channels are consumers subscribing to? 3.5 3% of digital TV homes claimed to watch only the free to view channels and said they do not subscribe to additional channels or packages. Are consumers making use of interactive digital TV facilities? 3.6 The last quarter’s survey reported traditional reasons for adopting this new digital technology - extra channels, rather than the interactive services or enhanced quality picture/sound, appeared to be driving uptake. However, of those who have subscribed to digital TV services, some consumers are already making use of the additional interactive services it offers. This is shown in figure 3d. 3.7 Downloading/playing games is still the most popular interactive activity, particularly amongst younger consumers. At least 1 in 10 digital customers claimed to use Internet, email and on-line shopping. These findings are consistent with findings from the last quarter’s survey. 3 in 5 customers claimed to use at least one of the digital TV interactive facilities (however, this includes Electronic Programme Guides).
3.8 The lack of widespread usage of on-line shopping, Internet, and email via digital TV may be in part due to the current lack of widespread availability of, and familiarity with these services. In addition, over a third of digital customers also have PC Internet access at home, where they can conduct a wider range of on-line activities at present. However, use of the interactive services was slightly higher than average amongst existing Internet users indicating perhaps their greater familiarity and propensity to use these services. 3.9 Younger consumers and the higher income groups were making most use of on-line services. There was no significant difference in usage across social grades. As consumers become more educated about the range of services available and their potential benefits, usage may well increase. 3.10 The last quarter’s survey reported high levels of satisfaction with the interactive services amongst those using on-line shopping, banking, email, Internet. Over 4 in 5 said that speed, ease of use, range of functions, and security of transactions was ‘good. No significant barriers to use of interactive services were identified for the majority of consumers. Lack of interest in these services either generally, or specifically via digital TV technology, was the main reason for not using the on-line services. This may again partly reflect the early development stage of these services, and consumers’ lack of familiarity with them. How satisfied are consumers with their digital TV services? 3.11 The last quarter’s survey reported that the majority of digital TV customers (83%) said their service was as good, if not better, than they had expected. The range of programmes, sound/picture quality, and value for money were the main reasons it was considered better than expected. Ease of use and navigation was also a contributory factor. 3.12 There was significant interest in ‘future’ services including video on demand, and ‘further information facility’ where viewers could click for more information about the programme or advert they were watching. Over 7 in 10 customers said they would be interested in using these facilities. (Footnote 3) June 99 is the baseline for this comparison rather than January 99 to ensure a sufficiently robust sample on which profile comparisons can be based 4. Reasons for not adopting digital TV and potential future usage 4.1 Figure 4a shows the main reasons for not having digital TV, given by homes who do not currently use digital TV services. 4.2 Lack of interest in additional channels and programmes was the main reason, particularly amongst those over the age of 55. 4.3 Cost however
appears to be a barrier to uptake for a significant minority of consumers,
both the cost of equipment and subscription charges. Mentioned by just
over a quarter of non-users, it was particularly a barrier for the lower
income and DE social groups, and homes without a fixed line phone.
4.5 13% of non-users said they were likely to get digital TV services in the next 12 months. It was most appealing to younger groups. As the range of interactive digital services develops and familiarity with these improves, more consumers may be interested in adopting these services. (Footnote 4) Consumers had to opportunity to state as many or few reasons as they wanted as to why they do not have digital TV. The chart therefore is not meant to add to 100% as several consumers gave more than one reason.
How widespread is the appeal of digital TV? 5.1 Growth in uptake of digital TV continues, and appears to be driven by both subscribers new to pay TV as well as existing analogue pay TV subscribers switching to digital services. Usage appears to be more evenly distributed across a wider cross-section of the population in terms of age, social grade and income, than other technologies, for example Internet. However, usage is still lower than average amongst the oldest and lowest income groups. 5.2 Although interactive services are not currently driving uptake of digital TV for the majority of customers, once on-line, a significant minority claim to be making use of on-line gaming and shopping, Internet, and email services. The last quarter’s survey reported that where available and being used, these services appear to be successful with the majority of users rating them ‘good’ on ease and speed of use, security of transactions and range of facilities available. Barriers to uptake to digital TV 5.3 Lack of interest was a key reason for not having digital TV. Whilst this in itself is not a barrier to uptake of digital TV, lack of interest due to a lack of understanding and familiarity with the range of additional services available is potentially a barrier to uptake. This may indicate an educational issue, and may also reflect the relatively early stage of development of many of these services. There appears to be a significant degree of consumer confusion about digital TV services, even amongst current users. A similar message is reported in other surveys, such as that conducted by the Welsh Consumer Council in March 2000, reported in their response to the Joint ITC, OFTEL and OFT consultation on digital TV. 5.4 Cost was identified as another potential barrier to uptake of digital TV services for a significant proportion of consumers. Over a quarter of consumers said that the cost of equipment and subscription charges was the main barrier to having digital TV. This is an important issue, particularly if it is hoped that digital TV will provide more consumers, particularly lower income groups, with Internet access.
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