Study Shows Internet Driving Boom in PC and TV ‘Multitasking'

A report from Showtime Networks Inc. and Paul Kagan Associates Inc. provides further proof of how media convergence is revolutionizing the way Americans use entertainment and information services.

The report, entitled "The Connected Household" reveals the emergence of a new class of "multitasking" viewer: the TV/PC co-user. In one quarter of all households nationwide—nearly 23 million—personal computers and TVs are placed in the same room and viewers in nearly 80% of those households watch TV and surf the Internet at the same time.

"Despite attempts to merge the Web and the TV into a single integrated device, the fact remains that consumers have effectively converged themselves without the need for a single box that will do it for them," said Larry Gerbrandt, senior vice president for Kagan. "As the battle for consumers' leisure time heats up, those who can exploit this fast-evolving home environment will find vast opportunities to develop interactive applications which marry the best features of both platforms."

The study also examines the role PCs and Internet usage are playing in relation to television viewing and identifies related trends in the proliferation and ownership of a host of audio, video, computer, peripheral, wireless, online services and other entertainment media and communications equipment in the home and at work.

While the PC universe increased 6% between late 1997 and early 1999, the number of online households has jumped 46%. Convergent households—those where the TV and PC are co-located in the same room—have increased more than 80%.

Mark Greenberg, executive vice president, Corporate Strategy and Communications for Showtime Networks, stated, "The fact that viewers in one out of every five television households in America are watching television and engaging in online activity shows us that the age of convergence is clearly upon us. These findings are instrumental in setting our agenda for creating layered, cross-platform programming as a means to enhance viewers' experiences and drive usage of both display devices in tandem."

One of the continuing fears of broadcasters and TV programmers is that the Internet, with its increasingly rich content and the ability to connect with users on an individualized, on-demand basis, will become yet another medium that erodes TV viewership.

But the survey data counters the widely held perception that TV viewing and online usage are mutually exclusive. Co-users of online services and TV do not report any greater drop in TV viewing than do exclusive online users. In fact, co-users report watching more TV per day than those households where the PC is located in a room without a TV set.

The research also shows how key demographics are consistent predictors of consumers' affinity for and adoption of entertainment and information services.

Convergent households provide a highly desirable target audience combining the best of PC-owner and TV-viewer demography. That audience has significantly higher average household incomes ($64,500 versus $38,800), education levels (44% versus 20% with college degrees) and a younger mean age of head-of-household (40 versus 45).

A consumer electronics manufacturer's dream, online co-user households are the most likely to have a VCR (97%), a CD player (88%), a stereo console (66%), a cellular phone (63%), a video game system (53%), camcorder (50%), pager (46%), satellite TV system (17%), handheld organizer (21%), and DVD player (13%).

Key findings also include:

• At this stage, it appears what consumers want to do is watch TV and access the Internet at the same time, and not necessarily on a single platform. There are now enough homes with PCs and TVs in the same room to conduct meaningful trials in which the advantages and capabilities of the two technologies can be virtually merged.
• The greatest incidence of TV/online co-usage can be found in households that subscribe to premium cable and/or direct-to-home (DTH) satellite service, with 30% and 50% higher online usage, respectively, than for the overall co-usage population.
• More than half (54%) of online household viewers watch TV while on the Internet. More than half (52%) watch either news (18%), sitcoms (17%) or sports (17%) while online.
• The majority of their online activities conducted during joint sessions include e-mail (44%), research on the Internet (34%), surfing the Internet (27%), checking the news (27%), making travel arrangements (19%), and chatting with friends (19%).

The study is based largely on a January 1999 survey of 1,166 US television households conducted by Ascolese Associates, an independent research company, as part of Showtime's ongoing series of research studies in convergence trends.