While Smart TV set adoption continues to gain momentum around the globe, there is a growing demand for streaming media player devices. Many users of the stand-alone device originally purchased it to connect an older TV to the internet. yet, some still prefer to use the device with their new Smart TVs.
According to the latest market study by The Diffusion Group (TDG), 14 percent of broadband households currently use an Internet Set-Top Box (iSTB) -- such as Roku or Apple TV -- to access online over-the-top (OTT) video content on their television set.
The demographic mix of early adopters is very broad. Internet set-top box use is especially prominent among Early Millennials (age 25-34) and Late Boomers (age 45-54).
As noted in TDG's study findings, 29 percent of adult broadband users are to various degrees likely to purchase a new iSTB in the next six months.
Interestingly, 48 percent of current iSTB users are to various degrees likely to purchase another iSTB -- that's a very telling statistic. It demonstrates that demand is ongoing, regardless of the increasing Smart TV adoption.
"The fact that current iSTB owners are significantly more likely than non-owners to buy an iSTB speaks volumes about the multi-room future of iSTBs," said Michael Greeson, director of research at TDG.
This in no way diminishes the extent of new demand, but it speaks to the fact that once a household owns an iSTB and understands its benefits, they want it on all their TVs.
As well, it appeals to broadband network operators looking for an inexpensive, consumer-subsidized way to expand their advanced digital TV services to other rooms of the home. This is positive news for both iSTB and ‘Internet stick’ vendors -- such as the Google Chromecast device.
Late Millennials (18-24s) are rightly a strategic priority for operators and networks, though when it comes to Internet set-top boxes, Early Millennials (25-34s) require a closer look, with 21 percent highly likely to purchase.
According to the TDG assessment, the target for new iSTB sales is a broadband user in their late twenties or early thirties, not the 18-24 segment that many are targeting.
The youngest group is keen on the benefits of an iSTB, but they use a net-to-TV device they already own -- most likely a game console.
Greeson argues that, for iSTB vendors, there should be two different messages for two different segments. One for the younger, highly-educated, on-the-move Millennial, and one for a less technologically-sophisticated pragmatist looking for a way to bring online video content to their television.