Telcos seeking new ways to reach viewers with their IPTV service should review landmark research from audience measurement kingpin Nielsen which reveals the number of video game consoles in U.S. TV households has risen 18.5 percent since the fourth quarter of 2004.
The research comes just two months after Microsoft Corp. announced plans to merge its IPTV software into its popular Xbox 360 gaming platform by the 2007 holiday season, giving telcos a way to reach gamers by pumping video through the consoles. (LINK- http://www.xchangemag.com/articles/07marcover01.html)
AT&T Inc. and others already using Microsoft IPTV software for their video deployments told xchange magazine in a cover story this month that they are evaluating the opportunity in an effort to broaden their audience by delivering video through a device other than a TV, PC or mobile unit.
That makes sense when Nielsen research shows that the top 20 percent of gamers use the system nearly six hours a day.
Sony Corp. and its PlayStation 3, a gaming archrival to Microsoft, has hinted that it will enter this nascent market segment.
The new Nielsen Wireless and Interactive Services report said that during the fourth quarter of 2006 there were 45.7 million homes with video game consoles, representing 41.1 percent of all TV households, compared to 39.1 percent (43 million) in 2005 and 35.2 percent (38.6 million) the previous year.
To put the research in perspective, Nielsen said the increase in both the number and the percentage of U.S. TV households with video game consoles is significant given that the number of total television households has risen just 1.6 percent during the same period.
As part of its Anytime Anywhere Media Measurement initiative, Nielsen is planning to cover this area in a more focused manner, with the launch of its GamePlay Metrics offering later this year. The service will, for the first time, deliver metered video game usage and demographic data by game title, genre and platform. (LINK- http://www.xchangemag.com/articles/537/6ah1813452684752.html)
Nielsen said the service will provide advertisers, agencies, hardware manufacturers and game developers with independent, high-quality, quantitative information for negotiating the buying and selling of in-game and around-game advertising.
Microsoft and home networking vendors such as Cisco’s Scientific Atlanta, see gaming consoles as another set-top box in the home, while service providers not using STBs with IPTV software see it as a threat.
Nonetheless, the potential ad market for content delivered through gaming consoles is lucrative.
Researchandmarkets.com estimates the combined revenue from the sale of both TV shows and movies via Xbox Live could reach $92.25 million in 2007 and growing each year through 2011, when the aggregate revenue from the sale of both types of content could top $726 million.
Among the key findings of the new Nielsen report:
• The number of connected console households (those subscribing to a service that links their systems to the Internet) has grown to more than 4.4 million, even before accounting for the connectivity of the PlayStation 3 and Wii platforms.
• Two-thirds of all men in television households between ages 18-34 have access to a video game console in their homes.
• During the fourth quarter of 2006, gamers in the top quintile (the top 20% of users based on average use over the quarter) accounted for 74.4 percent of total console usage.
• Between September 18 and December 31 last year, 93.8 million people used a video game console at least once for a minute or more. Moreover, in any given minute of the day, about 1.6 million people in the United States are using a video game console.
“The video game console has become a major player in the battle for the living room,” said Jeff Herrmann, vice president of Nielsen Wireless and Interactive Services. “In households across the country, consoles are successfully competing for consumers’ time and attention; not simply as gaming platforms, but as multimedia hubs that also can deliver high quality digital movies and IPTV.”
According to Nielsen, by the close of 2006, approximately 148.4 million people had access to at least one video game console system in their home. That represented more than half (52.4 percent) of the total U.S. television population.
But the levels of penetration were particularly strong among key demographic groups. While 67.7 percent of men aged 18-34 had access to a console in their homes, the percentage was dramatically higher – 80 percent – for boys aged 12-17.
The top 20 percent of all gamers averaged 5 hours and 45 minutes of usage per usage day.
AT&T Inc. www.attt.com
Microsoft Corp. www.microsoft.com
Nielsen Media Research www.nielsen.com
Sony Corp. www.sony.com
