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Benchmarking the Digital Household

The first Nielsen Entertainment Report, "Benchmarking the Digital Household" is a distillation of eight years of regular, in-depth surveys in American households conducted by Nielsen Media Research.

Some examples of key trends from the analysis:

* Though video game-owning households represent only about a third of the U.S. total, they are a fiercely technophilic segment, with some of the highest adoption rates of consumer electronics and services. These homes � with a disproportionate number of children 17 or younger � are the breeding ground for the heavy media consumers of tomorrow.

* Two key technology adoption inflection points were identified: a slow rate of growth until about 20 percent penetration and a second rapid expansion to mass market adoption once the technology or service reached 40 percent penetration.

* Average movie attendance among the households surveyed has been falling over the last eight years but the greatest falloff has come in the heaviest movie-going segment-those that attend theaters more than once a month. The steepest declines have been in the DVD-owning homes and the broadband-enabled households.

* A growing number of households are subscribing to both cable and satellite services-with the percentage almost doubling over the last few years.

* Some 80 percent of U.S. households subscribe to some combination of multi-channel programming service through cable, telco and satellite providers. At the 80 percent mark the cable networks reach, at least from the perspective of advertisers, a national footprint that is functionally equivalent to that of the broadcast networks.

* It has become a truism that digital technologies penetrate faster than their analog counterparts, in part because global manufacturing and global adoption have allowed pricing to fall faster. DVD players, launched only eight years ago, are in 78.5 percent of households. Cell phones are in 75.9 percent and personal computers are in 74.2 percent of homes � with virtually all of those connected to the Internet through a combination of dial-up, cable modems and DSL connections. The most important subsegment is the one comprised by cable modems and DSL, which offer high-speed access to the Internet and define the broadband universe. Some 34.3 percent of all households now have broadband access � and these homes are the foundation for the next generation of media and entertainment launches.

* The American household is awash in screens. From TV sets to cell phones to PDAs to PCs-even portable game and music players-the modern home is an open portal to outside entertainment and information providers. Some three-quarters have a PC and a third own two or more. More than half of all homes have three or more TV sets.

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