2 minute read 4 Aug 2022
A third of households consider downsizing their exposure to streaming services

A third of households consider downsizing their exposure to streaming services

Authors
Gabriel De Maigret

EY Luxembourg Audit Assurance Partner, Deputy PPD Leader

Over 14 years of experience in commercial and industrial companies and primarily in technology, media and Telecom sectors Gabriel is a qualified chartered accountant in Luxembourg since 2016.

Olivier Navarro

EY Luxembourg Audit - TMT Senior Manager

2 minute read 4 Aug 2022
Related topics Telecommunications

As habits created during the pandemic begin to change and living costs climb, consumers are re-evaluating their relationships with connectivity and content streaming. What is important in today’s connected households? Gabriel de Maigret and Olivier Navarro from EY Luxembourg analyze where service providers should focus their attention.

After showing significant growth during COVID-19 and posting all-time high stock prices in 2021, most online retailers and content providers, such as Amazon and Netflix, have experienced a significant decrease of profits – a readjustment coming from the market – in 2022. With the pandemic slowing down, consumers are re-assessing their need for increased reliance on technology in their homes.

The current global geopolitical situation and uncertain economic outlook have pushed consumers towards a more cost-effective approach when subscribing to digital services in their homes. According to the latest EY study on digital homes1, 45% of households believe they pay too much for content they do not watch. One out of three households is even considering reducing the time spent online and the number of streaming platforms they use as society returns to normal. This trend is expected to continue in the context of high inflation which is directly impacting consumer’s purchase price capabilities. The ecological footprint generated by extensive use of online services and the need to go back to face-to-face interactions are further drivers which are encouraging consumers to reduce their exposure2.

Gabriel de Maigret, Partner and Olivier Navarro, Senior Manager


While service providers keep upgrading their content offers by adding more channels or by increasing data speed with 5G or fiber technologies, 56% of households believe that their broadband provider does not do enough to ensure that they are on the best value deal. Consumers have become more receptive to bundle offers, including a range of options such as TV, mobile services, cloud storage and other smart home services that make online subscription more attractive than a single internet data plan. Here again, the pandemic has influenced habits by increasing the demand for new types of online services, such as home education, gaming and e-sports or health and wellness, while interest towards standard services such as online TV has declined proportionally3.

While pricing is one of the first drivers for households to reduce their digital usage, the exposure to harmful content and data protection remains a major concern, especially for younger consumers: 43% of users aged 18 to 24 years are very concerned about the inappropriate content that members of their household may encounter online. Providing greater control, better safety measures and a better communication about data privacy are key in the relation between users and service providers.  

Digital homes are and will remain an essential part of the online services industry. New technologies such as the metaverse and Internet of Things (IoT) are becoming embedded in more of our home devices and are opening new unexplored fields for connected households. In the end, it is the mix of various factors such as the global economic outlook, the development of new technologies for faster connections and the evolving spectrum of brand-new services to consumers, as well as the growing concerns about our ecological footprint, that will continue to influence the way consumers and their connected households evolve.

To remain at the top of the market, service providers must therefore make sure that their value propositions are attractive and that their interactions with clients are as convenient and smooth as possible.

Read the full study here: https://www.ey.com/en_lu/tmt/decoding-the-digital-home-study

[1] EY study – Decoding the digital home study 2022

[2] EY study – Decoding the digital home study 2022 “The survey revealed that 39% of respondents think connectivity and content providers aren’t doing enough to address climate change and sustainability”

[3] EY study – Decoding the digital home study 2022 “While TV is a mainstay of many broadband bundles, a rising proportion of consumers (29%) don’t see the advantages of buying broadband and TV from the same provider.”

This article has been published in Delano. 

Summary

As habits created during the pandemic begin to change and living costs climb, consumers are re-evaluating their relationships with connectivity and content streaming. What is important in today’s connected households? Gabriel de Maigret and Olivier Navarro from EY Luxembourg analyze where service providers should focus their attention.

About this article

Authors
Gabriel De Maigret

EY Luxembourg Audit Assurance Partner, Deputy PPD Leader

Over 14 years of experience in commercial and industrial companies and primarily in technology, media and Telecom sectors Gabriel is a qualified chartered accountant in Luxembourg since 2016.

Olivier Navarro

EY Luxembourg Audit - TMT Senior Manager

Related topics Telecommunications