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Report Forecasts HDTV Purchases

11/28/2004 7:00 PM Eastern

A new study by Frank N. Magid Associates finds that 29% of all consumers in the market for a TV in the next year will or are very likely to buy an HDTV set. Another 17% said they are somewhat likely to buy an HD set.

“That’s very encouraging,” says Maryann Baldwin, executive director of Magid Media Futures, which has been surveying consumers about HD over the past four years.

Magid sent out an online survey to 1,251 people across the country in October. Some 8% of those who returned the survey were HD set owners. But like the general HD population, only half of those set owners had signed up for HD programming from a cable or satellite provider. Some used the sets to watch DVDs with greater clarity, but some were watching TV, thinking they were receiving an HD signal when, in fact, they were not.

“There is still a lot of confusion in the marketplace,” says Jill Rosengard, managing director at Magid. Baldwin says that many people believe that since their HD set cost so much money, the programming will also be expensive, curtailing the number of people getting HD programming packages.

But that gap is closing. The most recent HD set buyers are shortening the time gap between when they get an HD set and when they subscribe to HD programming, Baldwin says.

For those that have both an HD set and an HD package, the primary complaint is lack of programming. “They are just more desperate for more channels,” Baldwin says. Many new set owners believe all channels are available in HD. “They don’t understand [the] acquisition and production process,” she says.

Some 32% of HD set owners who responded to the Magid survey said they look to see what’s available on HD every time or most times when they sit down to watch TV. Nearly 8% of HD set owners said they watch HD programming 75% to 100% of the time, while 14% said that they watch HD fare 50% to 75% of the time, and 50% said they watch it 25% or less of the time.

Magid found that 23% of non-HD set owners will be in the market for a new TV next year, about the national average. With nearly half of those very likely or somewhat likely to buy an HD set, Magid is projecting HD set penetration will double next year, closing in on 20% of the population. And a greater proportion of the potential buyers are falling into the middle income group. Still, the chief reason most consumers weren’t looking at HD sets was price, even though some sets are available for $700 or less.

And there is still a need for education on what programming is available in HD. Some 40% of shoppers could name only one HD network. Only 28% could name four or more networks in HD. “There is still a lot of education that needs to go on,” Baldwin says.

But the growing base, Baldwin says, should make HD appealing to programmers that have been on the sidelines until now. “There is going to be a large enough market that it’s going to be worthwhile,” Baldwin says. “From the programmer’s perspective, the shelf space is filling up. There won’t be unlimited shelf space.”

 

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