Report from PR firm Edelman finds people want to spend more time on computers and mobile devices; just don't ask them to pay for internet content
Good news for Silicon Valley may equal bad news for Hollywood, if a study released Wednesday by public relations firm Edelman is to be believed.
Of all entertainment sectors, only social networking sites have retained their value in the eyes of consumers over the past year.
In contrast, customers are turning to the movie and television industries for entertainment less and less frequently.
“What we are seen historically is an increasing amount of entertainment fragmentation,” Gail Becker, president of Edelman’s U.S. Western Region, told TheWrap. “More and more people are considering social networking to be a form of entertainment and that means the definition of what constitutes entertainment has broadened. That’s going to have real implications for the industry.”
The Value, Engagement and Trust in the Era of Social Entertainment Survey is an annual online survey among 18- to 54-year-old consumers in the U.K. and U.S., conducted in February of this year. The sample comprised 1,017 respondents, 500 from the UK and 517 from the US.
Sites such as Facebook held steady as the second most readily turned-to source for entertainment among 32 percent of respondents, the same figure as the previous year. Yet television fell from 58 percent to 47 percent and movies cratered from 28 percent to just six percent as the mostly frequently turned to source of entertainment.
In a sign of more dark clouds on the horizon, the report shows that the perceived value consumers are getting from the entertainment industry has fallen by 68 percent in all areas, and only 17 percent of all respondents feel that entertainment sources today provide “very good” or “excellent” value.
Social networking sites, which the majority of respondents believe are a form of entertainment, have remained stable with 31 percent of consumers in the U.K. and 37 percent in the U.S. saying they provide “very good” or “excellent” value.
Just don’t ask users to pay for the content that they find on the Internet.
Eighty-eight percent of consumers in the United States are upset by websites' moves to erect paywalls or charge for online videos. The major source of their frustration, according to the report, is that customers do not believe that entertainment companies are providing extra value for their money.
Instead, they suspect that the new levies and fees are motivated by greed.
“The entertainment industry has not done a good enough job of communicating the benefit of a payment structure,” Becker said. “It’s talked about in terms of the preservation of a business model, but it’s not discussed as providing added value to consumers. It’s not talked about as giving them better access or more efficient service.”
Companies should brush up their pitch, because the study also found that over half of those surveyed would like to use their computers to watch more movies and television shows and 30 percent are itching to acces content via their mobile devices.
“What will happen is that traditional entertainment entities will actually take a leading role in developing content for these platforms," Becker said. "This isn’t going to be the music industry, which left it up to tech companies to do everything. You’re going to see studios develop content that relates specifically to socially networked sites."
Becker warns that whatever content they do produce has to strike users as authentic or it will be rejected.
It’s a gamble, but unless Hollywood gets it right, certain trend lines could quickly become fault lines.
Charts courtesy of Edelman.