Connected TV and streaming device ownership to be 2X the number of US Internet households by 2017

Any number of pundits will tell you we’re in the “New Golden Era of TV,” as SVOD and TVOD services enlarge the known universe of content. But we’re also in a “New Age of Discovery” as more ands more devices come to market with the aim of connecting users more easily to that content through the biggest screen available in the house. Connected TVs, game consoles, Apple TV, Roku, Amazon Fire and more all are competing for that prime real estate in the living room. A new report from NPD Research says the continued adoption of online video by consumers is likely to prompt ownership of connected TV devices to grow 100% by 2017, meaning there will be more than 204 million connected TVs and streaming devices linked to the Internet and able to deliver apps to viewers, more than double the projected number of U.S. Internet households. “The evolution of hardware and digital content distribution is constantly changing the TV viewing experience,” said John Buffone, executive director, NPD Connected Intelligence. “Over the coming years, the consumer’s preferred device for apps on TV will be shaped by the next generation of video game consoles, Smart TVs, and a new wave of streaming media players.” NPD contends that two market forces are driving the adoption and use of connected TV devices; streaming media players and the TV itself. Combined, the two are expected to represent the majority of the growth in installed and Internet connected units over the next three years. NPD also said the rate of connections also is going up. Just a couple of years ago, fewer than 40% of Internet-ready TVs actually ever were connected. That’s changed substantially, although there remains a long way to go. Today, some 60% of Internet-ready TVs and devices are connected, and NPD said it expects that number to grow beyond 75% by 2017. Increased connectivity, NPD said, likely will be enhanced by hardware upgrades that prompt consumers to connect, increased app programming from TV networks, and improvements to user interfaces. All of that makes this a critical time for brands that have been scrambling for market share to begin developing plans for customer loyalty and upgrade programs. “Due to the rapid growth of connected TV devices, now is the time to establish consumer loyalty,” said Buffone. “Millions of viewers are trying new devices and apps, deciding which, if any, will become an indispensable part of their TV time.” NPD also suggests that by 2018, the connected TV device market will begin to reach saturation. The average U.S. home has three TVs, and by 2018 a majority of homes that want apps on their TV will have a connected device on their primary and secondary displays. A large portion of the connected TV device market will move from being for first-time connected TV households to consumers entering a device upgrade cycle.

Stay tuned.

Jim O’Neill is Editor of Videomind and Principal Analyst at Brightcove. You can follow him on Twitter @JimONeillMedia and on LinkedIn