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TMCNet: Consumers Continue to Buy HDTV Sets at Strong Rate, But Many Pass On HD Service

[November 24, 2008]

Consumers Continue to Buy HDTV Sets at Strong Rate, But Many Pass On HD Service

NEW YORK, Nov 24, 2008 /PRNewswire via COMTEX/ --
Frank N. Magid Associates' recent study of high-definition television set owners reveals that fewer first-time HDTV set buyers are arranging for high-definition program service from cable and satellite providers than ever before. Among the 12 percent of U.S. households who purchased a new high-definition television in the past year, 41 percent still need to arrange for high-definition program service from a cable or satellite provider, compared to as many as 80 percent with HD service among those who have owned their sets for several years.

"The majority of consumers have the arrangements they need to continue receiving local broadcast television channels following the digital transition (85 days from now), but still have not ordered the necessary service which will provide them with the high-definition programming they expect," said Maryann Baldwin, Vice President, Magid Media Futures. "We believe that many of these HD service rejecters believe they will automatically start receiving their programming in high-definition concurrent with the digital broadcast transition, which, of course, is an incorrect notion."

"Cable and satellite providers need to prepare for the day after the digital transition (February 18, 2009). We believe there will be a jump in HD service demand following the digital transition when HDTV owners realize the transition only pertains to the reception of local television signals, not the delivery of high-definition programming for their cable network lineup," said Jill Rosengard Hill, Senior Vice President.

When asked the degree to which these HDTV set owners have taken time to research their HD programming options, the Magid study reveals that 43 percent of these owners have not looked into HD services from any provider. Only 39 percent looked into cable HD options and 19 percent explored satellite HD options. When asked if there's any chance they may eventually arrange for HD programming service, 16 percent of these most recent HDTV set buyers say they may sign up for satellite HD in the next six months, while 22 percent may sign up for cable HD, suggesting that service providers have the opportunity to pick up another 4.5 percent of TV households as HD programming customers.

Additional reasons for rejecting high-definition programming service include the fact that 41 percent do not believe HD services are worth the required fees, 30 percent feel they don't have it in the budget after buying the HDTV set itself and 18 percent do not feel there are enough channels available in high-definition to make arrangements worthwhile.

This study indicates that tremendous HD customer acquisition opportunities still remain for cable and satellite providers, not just among those who will be purchasing a new HDTV set in the months ahead, but among the 12 percent of households who subscribe to cable and satellite but have not arranged for HD.

Currently, 32 percent of U.S. households own at least one HDTV set, and 64 percent of those owners receive HD programming from their cable or satellite provider, totaling 23 million households viewing HD programming at this time.

Magid releases its seventh consecutive HDTV and Digital Transition Consumer Update this week. The report is available for $6,000 by contacting Julie Zipperer at 319-377-7345 or jzipperer@magid.com.

About Frank N. Magid Associates
Founded in 1957, Frank N. Magid Associates provides research-driven, strategic media counsel on the evolving consumer mindset for clients in 37 countries. The company helps businesses that are struggling to make sense of a constantly evolving marketplace connect with an increasingly elusive, splintered consumer who is seemingly hidden behind an expansive array of technologies. Magid not only provides businesses with an understanding of the attitudes, opinions and actions of today's technology-saturated consumers, but also offers research-driven strategic advice on how to successfully brand, advertise, market and design their products and services. For more information, please visit Magid on the Web at www.magid.com.

SOURCE Frank N. Magid Associates
http://www.magid.com/

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