Cable Show Highlights Challenges, Advantages

If Cisco Systems Inc. is right, that according to its latest survey consumers are ready to live the connected life, then cable operators need continue to make certain changes to make sure they are connecting as many of those consumers as possible.

Perhaps their biggest challenge is getting up to speed on developing real customer intelligence in order to develop and perhaps beat telecom service providers to, that 360-degree, convergent view of the customer.

But first, let’s see what the survey says. Cisco’s recurring research platform, known as Connected Life Market Watch, identifies market transitions and key inflection points in consumers' behavior and expectations. It is conducted by Cisco's strategic global consulting arm, the Internet Business Solutions Group (IBSG). The latest study shows that “U.S. consumers are ready to experience the Connected Life and that service providers are strongly positioned not only to seize this emerging opportunity, but to fundamentally accelerate the marketplace.”

Cisco defines the Connected Life as one where near-pervasive broadband availability and a plethora of content and service options enable access to entertainment, information, social networks, and collaboration — from anywhere, at any time, on a broad array of devices.

However, up-front costs and a lack of ongoing support present a barrier to adoption of this life for up to 55 percent of these consumers.

Many of the latest findings reveal attitudes toward video. TV viewing on the Internet, for instance, is on the rise. Thirty-three percent of broadband consumers under the age of 30 watch a TV program on the Internet at least once per week. Those over 30 who watch a TV program on the Internet weekly watch 20 percent less traditional, live TV broadcasts than their peers.

Approximately half of U.S. broadband consumers want to bridge the TV and Internet video islands in their homes, but less than 5 percent have an Internet-to-TV video device. If the standards and solutions coming out of the NCTA’s Cable Show this week are any indication, this will change soon.

One statistic that will have to be addressed and turned from a sow’s ear into a silk purse is that 16 percent of current premium movie channel subscribers expect to cut or reduce their spending on movie channels next year. The upside is, the vast majority of consumers expect to maintain spend on core services such as basic voice, video and data. Enhanced services are more at risk.

Two things become clear about the challenges ahead for cable (and telecom) providers: customer demand and expectations are continuously evolving and no service is sacred or untouchable — only 29 percent of 25- to 29-year-olds said they would keep pay TV if they had to reduce their spending on core services. So where should cable providers in particular focus their energies?

Scott Puopolo, vice president and global head of service provider at Cisco IBSG, said technology and behaviors have signaled a profound transformation in the way that consumers experience news, entertainment, business and government, among others. “Service providers are in a unique position to lead and accelerate this emerging consumer market by managing and enhancing the consumer experience at every touch point," he said.