Futuresource Entertainment Summit Finds 70% of Adults Are Interested in 3D Home Entertainment
More 3D content next year will increase 3D hardware sales
On the heels of E3 2010, where Sony showcased a line of 3D games like Killzone 3 and Gran Turismo 5 and Nintendo 3DS was a hit, videogames will lead the upgrade of living rooms into 3D home entertainment centers. A recent conference in the UK, the Futuresource Entertainment Summit, focused on the transition from HD to 3D HD TV living rooms. As the pace of innovation shifts up several gears, the focus on the integration of entertainment content and home and personal electronics equipment has never been more intense.
In his presentation, Jim Bottoms, director and co-founder of Futuresource Consulting, examined the impact of 3D on the overall home entertainment business and reviewed the prospects for the entertainment markets, including hardware, content and delivery platforms. He revealed that recent Futuresource consumer research shows people have a strong interest in 3D capability within the home, with 70% of adult respondents expressing an interest - even with the need for glasses - and just less than half of all consumers surveyed would be willing to buy a new TV.
Although TV sets have an active life of well over 10 to 12 years, in reality the life is less than that, as consumers like to upgrade for new features and new designs rather than to guard against obsolescence. As a result, many early adopters of HD-ready TVs are now in a position to upgrade, given the massive developments in screen size, power consumption, set thickness, connectivity and other features, said Bottoms.
Looking to the content, Bottoms stated that there is little 3D Blu-ray content available at present and while Futuresource expects to see some releases this year it is going to be next year before the retail market really starts to expand. However, the arrival of 3D will help to boost consumer interest in Blu-ray for those who have not yet invested for the high definition picture quality alone, and will help to boost overall discs sales moving forward.
Sarah Carroll, director and co-founder, Futuresource Consulting, presented on the emergence of handheld connectivity and convergent devices, stating that handheld devices contributed over $44 billion dollars to Western European Consumer Electronics revenues last year, with the largest contribution coming from mobiles, laptops and netbooks. Despite the functionality overlap, Carroll said, consumers have still been buying dedicated devices which fulfil one particular purpose extremely well - whether that is a camera, a sat nav or a handheld gaming device. The digital camera category has held up reasonably well, though there was a slight slowdown in growth last year, but Futuresource forecasts showed the category will pick up again this year.
The personal video player is still an expanding category, with Apple dominating and taking almost a 75% share of the value. Overall, this category will continue to be impacted over time, particularly as smartphones accrue greater functionality and prices drop, due in part to subsidisation by the mobile phone operators.
Laptops continue to be popular, not only for productivity and work-related purposes, but also as entertainment tools, increasingly used for catch-up TV, image sharing and for watching video content. Additionally, netbooks are opening up a new market, and with an average price of 260 Euros they continue to gain traction.
This year saw the launch of the apple iPad, which almost created a new CE category: the smart infotainment device. It will challenge other products within the marketplace - though not the smartphone - and will take market share from dedicated devices like PMPs, eReaders and netbooks. The good news for the content industry, said Carroll, is that we are now seeing a widening array of devices across all categories with improved quality, extended battery life, enhanced user interfaces and 3G and wi-fi connectivity, which will translate into greater revenue opportunities for the publishing industry as a whole.
Alison Casey, Head of Global Content, Futuresource Consulting, presented key findings from the Futuresource 'Living With Digital' consumer study, based on consumer research carried out in the US, UK, France and Germany. Placing the responses in context, consumer spending on packaged, online, TV and mobile entertainment continues to grow as a whole. Packaged media is still going strong, with close to 10 billion Euros spent on packaged entertainment content across Europe last year, compared with only around 70 million Euros on digital entertainment. Significant growth in digital will start to develop, but packaged media will continue to dominate for many years to come, said Casey.
Futuresource research is showing that although the technologies and services are in place for the online delivery of entertainment content, mass market consumers will take some time to change their behaviour. Indeed, for the next five years the market will experience fragmentation, with a number of different business models and purchase triggers being tried to lure people into making digital purchases. These will include digital copy, BD-Live, managed copy, content pre-loads, digital covermounts and digital kiosks. The future landscape won't be concerned with transitioning people into digital, said Casey, as Futuresource research shows that people will continue to buy and rent DVDs and Blu-ray Discs, but they will supplement this with digital downloads, indicating that a large portion of digital revenues will be additive rather than cannibalistic.
The survey showed that watching online content is now becoming a mass market pastime, with more than half of all Desktop PC, Apple Mac, laptop and MacBook users occasionally or frequently watching video or movies online from the internet, with catch up TV dominating in the UK and USA, though new movies are also playing a key part. However, the propensity to pay for content online is still low.
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About the Author
John Gaudiosi
Editor-in-Chief
John Gaudiosi has been covering videogames for the past 17 years for outlets like The Washington Post, CNET, Wired Magazine and CBS.com. He has focused on the convergence of entertainment and videogames for outlets like Video Business, Home Media Magazine, Entertainment Weekly, The Hollywood Reporter and Variety. He currently serves as Editor-in-Chief of Gamerlive.TV and is also a freelance game columnist for Reuters and writes for outlets like Playboy Magazine, NVISION Magazine, GamePro Magazine, Official PlayStation Magazine, EGM Now, Maxim.com, AOL GameDaily.com, GeForce.com, and Yahoo! Games. John also serves as the video game expert for NBC in Washington D.C. John was named one of the Top 50 Game Journalists in the world by Next-Gen.biz in 2007. He is the co-author of Scholastic Books' How to Get into Videogames, Prima Publishing's Madden: Twenty Years of Videogame Football and Electronic Arts: The Official History.
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