TV Everywhere is a proposal from pay-television service providers to extend access for authorised subscribers to premium programming over the internet. A report by informitv partners TDG Research suggests that a third of Americans would be prepared to pay extra for such services, although of course that leaves a majority who would not.
The research indicates that 60% of adult broadband users in the United States are enthusiastic about such services, while 34% are willing to pay at least $5 extra a month for the facility, with a fifth of those prepared to pay more than $15 a month.
TDG believes that demand is such that operators could be leaving tens of millions of dollars on the table by not charging extra for multi-screen access.
“Current TVE-type offerings remain relatively fledging services with little in the way of compelling content,” noted Michael Greeson, founding partner of TDG and author of the new report. “That’s to be expected from a service breaking new ground and no doubt feeds operator belief that these services should be viewed as a free value-added service to existing residential TV subscribers as opposed to a new service capable of generating additional revenue.”
The rationale that TV Everywhere will reduce churn and limit the threat of other online video services is also supported by the same research. Among the segments profiled, the availability of television services across different devices and displays is likely to deter around four in ten subscribers that would otherwise consider cancelling their pay-television service.
The expectation is that operators may offer free services initially until the demand and breath of content can support the introduction of a premium tier that can justify an additional monthly fee.
Hulu recently extended its advertiser supported online offering with a subscription service for just under $10 a month.
Netflix is expected to introduce a premium subscription tier to its streaming service, offering extended programming. Satellite and cable pay-television operators will no doubt be watching with interest to see how this plays out.
Comcast, the largest cable television operator in the United States, plans to merge with NBC Universal, one of the founding partners in Hulu. Comcast is marketing its TV Everywhere proposition under the name Fancast Xfinity.
By bundling TV Everywhere style services with their pay-television subscriptions, cable and satellite television operators aim to limit the number of customers cutting the cord with their traditional pay-television provider, although the reality of this threat may be overstated.
The Federal Communications Commission is currently conducting hearings on the implications of the proposed Comcast NBC Universal merger. Some are concerned that a combined operation could have too much control over the production and distribution of programming.
Early Demand for TVE Services — A Consumer Snapshot is published by TDG Research.
www.tdgresearch.com
www.comcast.com
www.fancast.com
www.fcc.gov