There’s a message for cable operators in the ways that young adults watch TV and communicate:
- They are comfortable finding what they want to watch on Internet TV, whether user-generated video clips, full episodes of TV shows or recent movies.
- They see little value in using fixed phone lines when they have cell phones for talking and texting.
A survey by the Pew Research Center found that among 18-29 year-olds, only 24% and 53% rated cable/satellite TV service and TV sets as necessities, respectively, versus 50% and 73% of the 65+ age group. Reverse age-related trends were found for cellphones and highspeed Internet access, which were rated as necessities by 57% and 34% of the youngest group versus 38% and 14% of the 65+ set (Source: Social and Demographic Trends, Pew Research Center, survey Oct-Nov08, http://pewsocialtrends.org).
Not surprisingly, another Pew study showed much greater online video watching and social networking by the younger age groups. For example, in the 18-32 years-old group, 72% watch videos online and 67% use social networking sites, versus 14% and 4% of the 73+ years-old group, respectively. (Source: Sydney Jones, Generations Online in 2009, Pew Internet Project Data Memo, 28 January 2009).
A study by the National Center for Health Statistics reported that younger households are much more likely to have only wireless telephone service. This study also revealed substantially increased percentages of wireless-only households across all age groups since 2005. In the 18-24 age group, 31% lived in wireless-only households in 1H2008 as compared to 3% of the 65+ age group, up from 17% and 1% in 1H2005. (Source: Blumberg SL, Luke JV. Wireless Substitution: Early release of estimates from the National Health Interview Survey, January-June 2008. National Center for Health Statistics. http://www/cdc.gov/nchc/nhis.htm . 17Dec08)
Are young adults different just because they are young and, if so, will they set aside childish things as they get older? For example, if a young adult has relied solely on mobile wireless, will she want a landline phone when she’s 30? If someone has grown accustomed to the selectivity of online video, will he pay for a package of 500 basic and premium TV channels when he gets older, especially if online TV can by then be streamed conveniently to big screen TVs?
The most likely outcome is that today’s young adults will carry their online and mobile wireless preferences with them as they get older both because of habit and because online TV and mobile wireless are continuously adding more compelling features, functionality and convenience.
As a result, how landline phones and linear TV programming are offered may need to change. For example, a residential fixed phone line may morph into a “free” feature bundled with broadband access or (in the case of telcos) with mobile wireless. Concerning linear TV, cable operators and other stakeholders may find it worthwhile to reconsider the merits of a la carte, this time purely for business reasons, regardless of regulatory or congressional pressures. Next-generation interactive EPGs may allow subscribers to share reviews of TV shows and movies, one of multiple forms of operator-supported social networking.
Demographic trends play out gradually so MSO business models don’t need to be revised right away in order to respond. On the other hand, long-term changes in the Internet age can creep up quickly. Both the public World Wide Web and digital mobile wireless were introduced as recently as the early-mid-1990s, approximately 15 years ago, when very few of today’s young adults (or their parents) had any plans to go online or to use cell phones.
The ways of younger consumers provide valuable clues for cable strategists and marketers. Those who attend to such clues are better equipped to stay clear of a post-online twilight zone of newspaper classifieds, audio CDs, local travel agents and 30-volume encyclopedias.
