1. Strictly private and confidential – no reproduction or transmission without permission The Impact of Converged TV Technology on Actual Audience Behaviour Sarah Pearson July 7 th 2009

2. Strictly private and confidential – no reproduction or transmission without permission 1-3-9 Consortium Members

3. Strictly private and confidential – no reproduction or transmission without permission Overall Aim of 1-3-9 Provide early insights into actual (not claimed) audience behaviour in ‘converging homes’ where TV can increasingly be watched on screens 1ft, 3ft, and 9ft from the viewer.

4. Strictly private and confidential – no reproduction or transmission without permission Methodology. Video ethnography (similar to our earlier research on PVRs in 2005). Three phases with increasing ‘hot-housing’ (10.07, 5.08, 4.09) 30 individuals in 9 homes (Phase 1) reducing to 19 individuals in 5 homes (Phase 3) Mainly ‘early majority’ technology adopters

5. Strictly private and confidential – no reproduction or transmission without permission Claimed behaviour unreliable, reflects self perception not actual behaviour Claimed: Male (43) “It’s almost getting to the point where the recorded thing is the first thing that we turn onto – I see it as a first port of call” Actual: Embedded behaviour is to go straight to the EPG not the planner Claimed: (re: time shifting) “70 (recorded) 30 live” Actual: 88% live, 11% time shifted, 1% online VoD Claimed: Female (15) “I hardly watch anything live anymore, its always slightly delayed.” Actual: 64% live, 31% time shifted, 6% online VoD Claimed: Female (44) “Nine times out of ten we’ll put on something we recorded” Actual: 85% live, 15% time shifted Claimed: Male (42) “I now look at channels that I would never actually watch” Actual: 43% Channel 4, 28% BBC, 27% ITV

6. Strictly private and confidential – no reproduction or transmission without permission Some highlights Big channels are here to stay! 9ft screen : PVR users want bigger hard-drives not more VoD The 3ft screen is best for private VoD

7. Strictly private and confidential – no reproduction or transmission without permission 1: Big channels are here to stay Percentage3ft9ftTotal Live0.461 Time-Shifted or catch-up 42933 True OD426 Total 892100% Even with ‘hot-housing’ (Phase 3) 61% of viewing was still live on the 9ft screen 94% was regular linear TV (mostly from the main channels) watched live, time shifted (PVR+TV), or catch- up TV (3ft or 9ft) Results From Phase 3:

8. Strictly private and confidential – no reproduction or transmission without permission 1: The limited impact of true OD viewing Only 6% of total viewing, despite ‘hot-housing’ Despite breadth of choice online, 50% of video viewing on the 3ft was iPlayer and 4oD. 71% of YouTube viewing was TV content originally broadcast on ITV or BBC PVR users find it easier to choose from a few favourite channels, usually BBC, ITV and C4 On Demand will have little impact on big channels which remain strong

9. Strictly private and confidential – no reproduction or transmission without permission 2: PVR users want bigger hard-drives, not more On Demand PVR use increased from 15% Phase 1 to 28% Phase 3 PVR dominates non-live viewing “We don’t have a need for it (VoD) anymore, it’s much easier to use the Virgin +.”

10. Strictly private and confidential – no reproduction or transmission without permission 2: PVR users want bigger hard-drives, not more On Demand Hand picked ‘archive’ on the planner reduces appetite for OD “We don’t need On Demand, we have a resource and that’s the recordings” PVR users want the capacity to build larger archives: “There’s never enough space … even with the HD, the space that’s got on it, you still get to 5%” As hard-drives get bigger, VoD on the 9ft may become increasingly redundant Content viewed from planner Phase 2 Delay TV 65% Archive TV 71% Delay TV 29% Archive TV 35% Phase 3

11. Strictly private and confidential – no reproduction or transmission without permission 3: The 3ft screen is the right (private) space for On Demand Why are viewers happier to sit at 3 foot? Need to understand the dynamics of main set – Viewers access two types of content off the PVR 1.Compromise content enhances the social viewing experience 2.My TV enhances the private viewing experience but rare and infrequent Compromise wins on the 9ft because the 9ft is perceived as a social space The 3ft screen is emerging as an alternative space for My TV As private viewing on the 3ft goes up, social viewing on the 9ft goes up: Social viewing > Phase 1: 70%, Phase 2: 75%, Phase 3: 78%. As 3ft increases > compromise on 9ft. Phase 1Phase 2Phase 3 0.4 mins7 mins10 mins Average time spent viewing online VoD per person per day In PVR homes, VoD may be more successful on the 3ft - over half content viewed is long form

12. Strictly private and confidential – no reproduction or transmission without permission The Laptop is the right (private) space for VoD 84% of online VoD is on laptop in the lounge Semi-mobile so context is flexible Lean-back experience more possible in lounge Familiar TV environment/more prompting Private viewing in social space Future households may have a network of screens that are complementary and used simultaneously 3ft screen offers a different experience Bingeing ‘Build up’ to high urgency on 9ft Seek out new or free content 3ft is a better option than the 9ft screen

13. Strictly private and confidential – no reproduction or transmission without permission Some highlights Big channels are here to stay! 9ft screen : PVR users want bigger hard-drives not more VoD The 3ft screen is best for private VoD

14. Strictly private and confidential – no reproduction or transmission without permission Thank you