Future Foundation: TV in the digital age

In our latest Research Focus report, Future Foundation reveals why TV is still one of the UK’s most valued and popular entertainment activities…

Television sets lying dusty and forgotten. Mass switchovers from traditional to new broadcast media.  This was the gloomy prediction of recent years as new forms of entertainment media began developing.  However, the scenario that has emerged is rather different.  Research from the Future Foundation reveals that television remains one of the UK’s most valued (see chart below) and popular entertainment activities, watched, enjoyed and trusted by millions.

According to Future Foundation research, 88% of consumers watch TV at least once a day or nearly every day, with the average UK citizen consuming 26 hours and 18 minutes of broadcast TV a week – an increase of 48 minutes a week on 2007.  Commercial TV accounts for 63% of all viewing.  Subscriptions to digital TV platforms are marking a steady increase and multichannel TV penetration (the likes of Freeview, Sky and satellite TV) is tracking at 87% penetration in UK homes.  And the increase in digital technology is creating more choice and more opportunities to enhance our viewing experience.  Hardly the picture of a dying medium.

In-home – the new out-of-home

Unsurprisingly, the recession has proved to be a key player in the ongoing success story of TV – faced with the cold chill of economic uncertainty, TV has brought a new dynamic to in-home socialising, aided by the magic of multimedia.  High-budget mass-appeal entertainment programming – The X Factor, Strictly Come Dancing, Britain’s Got Talent – serve to strengthen the pull of the home and provide a crucial social function, securing the home’s place as a leisure destination.

To meet the demand for on-tap in-home entertainment, British consumers own more technology devices than ever before. Nearly 26m homes (from a total of 26.6m households in the UK) are television households – in fact, the average household owns three TV sets; more than 80% own a computer and 75% a broadband internet connection; more than 60% have invested in a DVD recorder; and games consoles are capturing the attention of more than one in four British households.

However, this is not just a story of the recession.  So sophisticated and so widely appreciated has the in-home leisure experience become, the market is anticipated to increase by over £40bn in 2015 vs £9.7bn for out-of-home leisure.  As the home bond continues to go from strength to strength, so the TV sits at the centre of the hearth, basking in the warm glow of appreciation.

Of course, life in TV-land isn’t perfect – the economic downturn has lead to a widespread assessment of expenditure and entertainment subscriptions are coming under scrutiny.  One in ten (9%) consumers already claim to be cancelling or reducing personal subscriptions as a direct result of the economic downturn.   In addition, commissioning budgets are being slashed which could have consequences for quality programming – and if there is a dry-up in scheduling, will consumers start looking wider afield for their TV choices?

TV on the move

Although evidence points to the fact that our love affair with television continues unabated, it is interesting to note that it is being freed from the shackles of living room furniture and becoming a much more dynamic medium.  One of the biggest growth areas is in internet TV viewing – latest Future Foundation research reveals that almost a quarter of people now watch and download TV and films online, a significant increase from the 8% recorded in 2007. Unsurprisingly, the younger generation is leading this trend, with 40% of 15-34 year olds having done this activity in the last 6 months.

The choice of online broadcast activity is vast and in many ways increases, rather than diminishes opportunities for growth within terrestrial viewing models.  Within a mouse click, we can download the latest films and programmes, catch up on missed TV, access the archives of yesteryear and even, thanks to likes of YouTube, make our own programmes – some of which make it back on to the big screen (e.g Channel 4’s Rude Tube).  All of this points to the fact that TV continues to be a valuable asset as long as broadcasters continue to evolve and adapt with technological change.

Of course, we can’t ignore the growth in mobile phone technology – the latest wave of Future Foundation research revealed that nearly one in 10 consumers already download and view video/ TV clips on their mobiles.  And with the rise of the trend the Future Foundation terms Smart Boredom, the conversion of downtime into something constructive and beneficial, consumers are increasingly turning to their Smartphones for distraction and entertainment.  As Smartphones penetrate further, functionality becomes more user-friendly and accessibility and cost issues are resolved, short format consumption on the move can be enjoyed by many more.

Free the TV!

Inextricably linked with the rise in alternative broadcast options is the revolution in pricing – whereas we would previously have expected to pay for any content that had been produced by another, we now tap into a seemingly boundless universe of free material.  We can watch free television via on-demand websites, access free music on Spotify, make free telephone calls on Skype, read free online newspapers and much more.

As we can see from Future Foundation research, around two-thirds of people (67%) now agree that “If I watch a programme on TV, I expect to be able to watch it free on the internet”. This particularly resonates with younger viewers (in fact, 75% of 15-24 year olds), who have become accustomed over the past few years to having access to television programmes via the internet.  And once an attitude like this becomes entrenched, particularly in the wake of a hard-hitting economic downturn, it becomes extremely difficult to reverse.

Which poses a real challenge for broadcasters – we anticipate that increasingly innovative solutions will be required to meet the demands of the price-conscious consumer.   The area of incidental pricing (e.g. micropayments for particularly valued content), currently lighting up the print media debate, may well dictate the TV news of tomorrow.

In summary, while television remains a dominant force in British society, it’s clear that consumers demand more from TV than ever before.  Not only do we expect the latest technological innovations and to be able to personalise our choice of content; but we also expect accessibility and convenience to be unimpeded.  We are not just viewers; we are accomplished and exacting viewers, well evolved (and involved) in our viewing habits and demands.   We want it all, anytime, anywhere – and woe betide any broadcaster that doesn’t offer just that.

For more on the future of TV, contact Karen Canty at the Future Foundation on 020 3008 5772/ karenc@futurefoundation.net.