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Cable Technology Feature Article

May 31, 2011

Consumer Satisfaction with Subscription TV Falls

By Gary Kim, Contributing Editor

Video cord cutting has new drivers, a new study by Edelman (News - Alert) suggests. As consumers are accessing content from multiple devices, 68 percent of US and UK consumers think the value they are getting from the entertainment industry has fallen, and only 17 percent of all respondents feel that entertainment sources today provide "very good" or "excellent" value. One might infer there is very high latent dissatisfaction with current offerings, and presumably high receptiveness to alternatives.

At the same time, social media is arguably emerging as a potential contributor to changing end user perceptions of the value of linear video entertainment subscriptions, just as video games and other Web applications earlier established their own places within end user discretionary time pursuits.

According to the 2011 Edelman “Value, Engagement and Trust in the Era of Social Entertainment” survey, 63 percent of UK respondents and 56 percent of US respondents report they are spending more “entertainment” time than a year ago with the Internet, and 40 percent in the UK and 49 percent in the US report spending more time with social media.

Social networking sites, which the majority of respondents believe are a form of entertainment, have remained stable with 31 percent of consumers in the UK and 37 percent in the US, saying they provide "very good" or "excellent" value.

"A lower perception of value in the entertainment industry represents the commoditized nature of today's entertainment," said Gail Becker, president of Edelman's Western U.S. Region.  "With so many forms of entertainment, consumers are spreading their attention across multiple platforms, leading to a decline in perceived value in any one format.”

Some 59 percent of people in the UK and 53 percent in the US spent more time on their laptops in the last year, and 49 percent of people in UK and 52 percent in the US spent more time on their mobile phones.

52 percent of all respondents would like to use a computer to access further entertainment content, and 30 percent would like to be able to access that content on their mobile phones.

An overwhelming number of consumers (84 percent in the UK and 88 percent in the US) feel negatively about the move from free to paid entertainment services. The survey also reveals that pay walls created by entertainment sources for previously free services are being met with feelings of frustration and distrust by users. Some cite the lack of improvement in quality of service, while others state they would suspect a profit motive driven by greed.  

The Internet is the second most frequently turned to form of entertainment in both countries for the second year in a row, while television remained the most frequent form of entertainment in both countries, though television share has dropped significantly since 2010, down about eight percent in the UK and 11 percent in the US.

Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.