Yankee Group: Video Game Consoles: The Next TV Network

The Renewed Battle Over the Digital Living Room

Americans spend an average of 136 minutes every day watching television, according to Yankee Group’s Anywhere Consumer: 2009 U.S. Survey Suite. It goes without saying, then, that any company that can make its mark on U.S. television sets can also make its mark on U.S. pocketbooks.

For years, service providers have controlled the TV via subsidized set-top boxes (STBs). And these products kept getting better as they added features like widgets, remote DVR controls and streaming video from online sites like YouTube. Meanwhile, despite faster innovation and time to market, consumer electronics manufacturers have generally struggled in this space, given the higher upfront cost of their most successful connected offering to date—the digital media adapter.

Recently, however, the online communities of video game consoles have begun offering innovative new features that directly challenge service provider offerings in the VoD and mobile video space. These offerings could promise to turn the tide in favor of consumer electronics manufacturers. Using findings from our Anywhere Consumer: 2009 U.S. Survey Suite, Wave 1-12, we predict that video game consoles will increasingly eat into service provider advertising and VoD revenue, while stealing consumer eyeballs. Furthermore, consoles promise to take the fight beyond the living room by introducing VoD content to multiple devices, including mobile phones, through their online communities.

Keywords

Video game, console, TV, network, household

Pages
Publish Date & Author(s)

by Dmitriy Molchanov, Analyst
4 pages
February 2010