Report Points to Increase in Internet-Connected TVs in U.S.

Connected TV penetration has exceeded the 60 percent mark for broadband households in the U.S., according to new data from The Diffusion Group, indicating that an increasing number of consumers are interested in receiving entertainment services such as Netflix and Pandora. TDG’s January 2014 study found that 63 percent of broadband households have at least one Internet-connected TV, up from 53 percent the same time last year. The numbers reflect smart TVs in addition to devices like game consoles and Internet sticks.

“Though broadband diffusion may be slowing as the market matures, the expansion of broadband-connected TVs continues at rapid clip, up 19 percent in the last year,” said Michael Greeson, TDG president and director of research.

The study found that average ownership is 1.6 units among households with a net-connected TV, “meaning a large portion of users own multiple net-connected TVs,” notes the press release. “In fact, 42 percent of connected TV owners have two or more such configurations.”

In December, IHS reported that more than 86 million U.S. households had broadband Internet access (70.2 percent of all American households). IHS projects that coverage will reach 74.1 percent of households by 2017, or 94.7 million homes.

Cable is the main form of broadband Internet access. While DSL continues to decline, “cable connections have been growing at an average of 600,000 connections every quarter for the last two years,” notes IHS.

“Whether net-to-TV video will somehow topple traditional pay-TV service models has been a red herring from the beginning,” says Greeson. “The real debate is the extent to which the growing availability and expanding use of ‘OTT TV’ services will have on the time viewers spend watching traditional pay-TV given the growing array of sources at their disposal. While not a simple zero-sum game, we are nearing or at that breaking point where the growing use of broadband-based sources simply chips away at time once spent using traditional sources. This is hardly a radical argument, and made all the more inevitable given these new findings.”

TDG’s Benchmarking the Connected Consumer — 2014 report, the fourth iteration of this study, also “examines a broad array of behaviors across a multitude of net-connected devices, from net-connected TVs to tablets, and from PCs to smartphones.”