Retail After the DTV Transition

On June 12, 2009, the nation underwent a monumental change years in the making as television broadcasts switched to an all-digital format. For households receiving over-the-air broadcasts, the transition allowed viewers to receive a higher quality picture and expanded channel line-up, among other benefits.

For all households, the switch to a smaller bandwidth digital signal will allow for improved public safety communications as well as more advanced high-speed wireless internet access. While most consumers were prepared for the transition, households with analog sets connected to an antenna were required to take action to ensure their televisions would continue to receive programming.

The transition clearly affected the way viewers receive programming going forward, but how did consumers respond? How did retailers and manufacturers benefit?

As a result of the marketing and educational efforts aimed at raising awareness, very few consumers were caught unaware or unprepared for the transition. According to CEA’s recent DTV Transition Impact study, nearly seven in ten (67 percent) of all households had some degree of familiarity with the transition and more than eight in ten (82 percent) affected households knew of the transition for a year or more. This level of familiarity translated into action with 35 percent taking some kind of purchase action (obtaining a coupon for a DTV converter box, purchasing a DTV converter box, purchasing a digital television, or purchasing an indoor or outdoor antenna) as a direct result of the switch.

While the low cost (and for some free) option of obtaining a government-issued coupon for a converter box was popular among almost a quarter of respondents needing to take action, a surprising number of consumers (23 percent) opted to subscribe to a cable, satellite, or fiber optic to the home provider as a way to receive programming and 14 percent said they purchased a digital television. In the midst of the nation’s worst economic recession, why are consumers taking on these added expenses?

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