The box, seen through a box
Although digital TV penetration has not risen much in the past year, it seems likely that the launch of Freeview will restore some much-needed momentum
The uptake of digital television has been slow in Britain. By the end of November, only 41 per cent of adults had some form of digital TV at home. A year earlier, the comparable figure was 39 per cent.
Though the raw figures raise fears that the level of ownership of digital TV has reached a plateau, BMRB research indicates that the BBC-backed Freeview service is likely to kick-start the digital TV market in 2003.
Freeview has been positioned to attract those who have stubbornly refused to join the digital TV revolution. The absence of subscription charges may well tempt those who object to paying extra for the programmes that they watch at home. The Government is certainly hoping the service proves successful, if it is to meet its target of switching off analogue TV transmissions by 2010.
The majority (67 per cent) of those with digital TV at home have Sky Digital, while a quarter have a cable digital TV service provided by NTL or Telewest Broadband. The rest (eight per cent of all digital viewers) have the recently launched Freeview service. A year ago, 13 per cent of digital viewers subscribed to Freeview’s predecessor, ITV Digital.
Despite being the least popular digital platform available, early signs are encouraging for Freeview. At the time of launch, according to BMRB, about 750,000 households were able to receive Freeview at home, either through a set-top box or through an integrated digital TV set. Almost all of these households would previously have subscribed to ITV Digital. A month after Freeview’s launch, the number of households with Freeview had grown by about 100,000 despite a fairly low level of marketing activity; certainly when compared to the fanfare that greeted the launch of ONdigital and its rebranding as ITV Digital.
Just prior to Freeview’s launch, BMRB asked people not receiving digital TV at home how likely they would be to sign up to a new digital television service about to be launched by the BBC. The consumers were told that the service would be free and would give access to over 20 channels, but that it would be necessary to buy a set-top box costing about £99. Nine per cent said they would be very likely to get a Freeview box in the next 12 months, while a further 19 per cent said they would be quite likely to do so.
If those who said they were very likely to get a Freeview box in the next 12 months actually did so, the number of households with access to Freeview would rise to about 2 million, meaning that the proportion of adults with digital TV at home would rise to 46 per cent due to the growth of Freeview alone.
Of course marketers, as well as the Government, will be keeping a close eye on digital TV penetration. Of particular interest will be interactivity, and how it can be used effectively as part of a television advertising campaign. Marketers hope that digital TV will open up new avenues through which consumers can be reached.
Interactive advertising has certainly grown in the past 12 months, with many more advertisers exploring the medium. Sky Digital and the cable companies have taken steps to make it easier for advertisers to set up interactive campaigns.
Despite this increase in activity, only 13 per cent of digital viewers claim ever to have interacted with
an advertisement via digital TV. Between platforms, however, there are considerable differences in the proportions of viewers interacting. Almost a fifth (17 per cent) of Sky Digital viewers have interacted with an ad, compared with just five per cent of Freeview viewers and three per cent of cable viewers.
The main driver for interacting with an ad is curiosity, with nearly two-fifths of interactors (38 per cent) citing this as a reason for interaction. The second most given reason was a specific interest in the product being advertised (28 per cent), followed by a desire for more information (18 per cent) and the chance to receive a free sample (14 per cent). It is expected that the proportion of consumers giving curiosity as a reason will decline over time, as interactive advertising loses its novelty value.
The digital TV market has changed considerably since the medium’s launch a little more than four years ago and the rate of change looks like continuing for the foreseeable future. The success, or otherwise, of Freeview, and the continuing development of interactive advertising are just two areas upon which it will be worth keeping more than a passing eye.
