Does growing dependence on digital worsen well-being?

The latest Digital Home survey reveals increased digital activities at home have escalated demand for reliable connectivity.

The COVID-19 pandemic has dramatically altered the landscape of products and services consumed by households over the last 12 months. But even in these troubled times, there is plenty of good news, according to Decoding the digital home, our annual study of consumer attitudes toward technology. Levels of digital inclusion have increased during periods of national lockdown, with connectivity and content providers acting as a critical platform for continued socioeconomic interaction. However, long periods spent at home have also seen households question their reliance on the online world, with signs of overload and distrust also apparent. This indicates that providers must look well beyond positive adoption and usage trends if they are to make the most of their newfound importance.

COVID-19 has prompted a surge in digital activities

Households have adopted a number of services for the first time since national lockdowns were imposed, and video calling leads the way, while grocery shopping and access to health and education services are going digital at pace. Younger groups typically lead in terms of first-time adoption, but older groups are playing catch-up in certain services, such as video calling of friends and family.

Connectivity and content needs are rising

Alongside this rapid shift to online products and services, households recognize that their connectivity and content needs have increased, yet greater demand is not apparent everywhere.

• Consumers in Germany and France are more likely to disagree that their connectivity and streaming needs respectively have increased.
• Growing reliance on the digital home has largely translated into greater engagement with the connectivity and content that they buy, although there are exceptions in France and Germany.
• Growth in both demand and engagement is best aligned in the UK and US, indicating more responsive customers compared with other markets.

Ultimately, most households across markets agree that providers have coped well with the crisis. Connectivity providers top-score – reflecting the goodwill created by COVID-19 relief packages that offered extra data or allowed payment holidays – while social media platforms lag, highlighting ongoing challenges they face around fake news.

Digital well-being and data protection concerns are growing

Despite rising service adoption and largely positive perceptions of service providers, the pandemic has heightened fears regarding personal data and the effect of the internet on well-being.

Sixty-nine percent of households across markets are very cautious about disclosing personal data online. Our research reveals that the pandemic has heightened these anxieties, with 4 in 10 households more likely to be considering their digital well-being or concerned about personal data privacy compared with before the crisis, and younger groups often outscore their older counterparts.

Distrust of content and connectivity is a concern for many

There are also specific grievances that connectivity and content providers should tackle. More than one-third of respondents are very concerned about harmful content that their households may encounter online, and are wary about using 5G mobile, despite assurances from governments and communications service providers (CSPs) of its safety. With one-half of households favoring a very tightly regulated internet, providers may yet have to adapt to a growing compliance burden.

Rising demand and anxiety are highest among families with children

While there are variations among markets in terms of the changing digital behaviors and attitudes, what is perhaps even more striking is how the responses of specific groups tend to align across markets.

Family households with children are an important example: the positive correlation we have identified between rising demand and increasing anxiety is most pronounced in this group. All considered, the most demanding users of the digital home are also those who are most sensitive to its potential shortfalls and downsides.

Spending intentions are encouraging

The outlook for monthly spending is broadly encouraging. There are more users prepared to increase, rather than cut back on spend, but for younger users, the outlook is more volatile, with greater willingness to both increase and reduce spend.

These positive spending intentions are echoed by an interest in high-end packages, with 20% of customers open to paying a premium for super high-definition content, for example. In many cases, the pandemic is acting as a catalyst: 25% agree the crisis has made 5G more appealing while 26% believe it has highlighted the importance of upgrading to gigabit broadband. Meanwhile, 30% of households now see the benefits of taking all connectivity and content from a single supplier, with younger groups showing the greatest appetite for a “one-stop shop.”

More households are focused on savings and value for money

However, fears of overpayment and the need to control costs are more pronounced than the appetite to upgrade or spend more, as more than one-half of households see bundles as a route to savings, and 4 in 10 think they already pay too much for content.

This is a critical issue for providers since customers expect more support. Forty-two percent of households across markets don’t believe their broadband provider does enough to ensure they are on the best deal, for example. While households’ spending predictions paint a positive picture, their underlying attitudes tell a different story.

Is the digital household at saturation point? Feelings of overload and confusion are pronounced

The research has identified tensions in the digital home, with demand partnered by anxiety. Meanwhile, positive spending profiles and openness to premium offerings are overshadowed by value consciousness, regardless of product or service.

The survey findings also suggest many households are at saturation point. Forty-seven percent seek downtime from smartphones and other internet-enabled devices. Consumers are doing more than voicing the need for “time away” from their devices, as many are opting for the familiar, while some are keen to downsize their online universe.

Importantly, these feelings of fatigue and overexposure extend beyond products and services to relationships with service providers themselves. More than 4 in 10 households agree there is simply too much choice of different service bundles, while a similar proportion (47% average across markets) agree that introductory offers complicate their assessment of value.

Trust and value concerns limit the appeal of the smart home

If service providers ignore these warning signs regarding data protection, value and digital fatigue, then new products and services will fail to gain traction. Nearly one-half of households see the ability to control white goods via devices or mobile apps as a gimmick or fad, while even more are concerned about potential security flaws. Just one-quarter think smart home products are reasonably priced. Unless addressed, these attitudes will hamper adoption rates of smart home services.