For a while, smart TVs seemed to be smarter than their owners: Even though they were Internet-capable, they were used mainly for standard TV services. Now, owners seem to be showing more interest in what their smart TVs can do. The proportion of U.S. smart-TV owners who use their Internet-connected televisions to watch online video increased by more than 30 percent in the last six months, according to new market research from Parks Associates. In addition, viewers are using their smart TVs more often.

“The percentage of smart-TV owners connecting the device to the Internet has steadily increased, from approximately 40 percent in 2010 to 56 percent today,” says Pietro Macchiarella, research analyst, Parks Associates. “This device, when connected, offers a toehold to a variety of players, including broadcasters, over-the-top video providers, and pay-TV providers.”

The new research shows that the number of Internet-connectable TVs shipped will jump from less than 1 percent in 2008 to more than 45 percent in 2012. The report also shows:

• 75 percent of U.S. smart-TV owners who connect their sets to the Internet watch on-demand online movies at least monthly, versus 57 percent in 2011.
• 71 percent watch online TV shows at least monthly, versus 51 percent in 2011.
• On a near-daily basis, 30 percent watch movies and 32 percent watch TV shows.
• The report analyzes the implications of this increased penetration of smart TVs for manufacturers, content owners and pay-TV providers.

“Smart TVs have the potential to be both a threat and an opportunity for pay-TV providers,” says Brett Sappington, research director for Parks Associates. “Smart TVs provide consumers another way to access over-the-top services like Netflix on the TV, providing a new distribution channel that all players can leverage to deliver content to consumers. However, by integrating the smart TV into their distribution model, pay-TV providers can leverage their strengths in content costs, customer relationships, bundling and other areas to play a more substantial role in OTT. In addition, pay-TV providers can potentially use smart TVs to lower subscriber CPE costs, an important consideration in a highly competitive market.”

From the article, "Parks Associates: More than half of Smart-TV Households watch OTT Video."

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