HP Innovation Journal Issue 09: Spring 2018 | Page 62

Special Report
Figure 2
3. Consumers want more than just fun from augmented
and virtual reality.
The broad consumer base is more interested in practical,
daily life Augmented and Virtual Reality (AR/VR) appli-
cations than gaming (Figure 3). While non-gamers have
lower average AR/VR purchase intent, the larger popula-
tion represents a hardware sales opportunity equal to that
of gamers.
AR/VR is evolving into a range of different use cases
and device form factor will most likely play a role in their
adoption. Consumers are interested in AR/VR technology
and services, but few are comfortable wearing intrusive
devices. Integrating AR technology into wearable and
other daily life devices is one way to overcome the chal-
lenge. In fact, 55% of consumers long for the day when
they can replace their smartphone with a wearable solu-
tion that has all smartphone functionality through voice,
augmented reality, and hologram interfaces.
Now is the time to consider blending AR/VR into prac-
tical life experiences. While AR/VR is differentiating now,
it will increasingly be embedded across a wide range of
services. Defining ways to further differentiate the expe-
rience as AR/VR becomes more ubiquitous will be key to
creating service monetization opportunities.
4. Consumers are in search of simplified, flexible and
engaging subscription over-the-top video experiences.
With more than 200 over-the-top (OTT) service provid-
ers in the U.S. alone, it is not surprising that consumers
often need to manage multiple OTT services to get all the
62
content they want. However, an overwhelming majority
of respondents (86%) are tired of this juggling act. Their
search for a simplified, centralized experience points to
the potential of aggregation services and managed access
models in the industry.
Yet, this does not mean consumers are looking for
access to all content—just theirs. Half of the respondents
(51%) believe they are paying for content they don’t want,
an indication that the market is ripe for flexible bundles
that can be customized to consumer preferences and new
business models that can unlock additional consumer
demand (Figure 4).
While many OTT services are gravitating towards
subscription-based models to drive revenue, Accenture
research reveals that there is still a healthy consumer
appetite for advertising. In fact, 64% of respondents
stated that they are not willing to pay more to remove
advertising. This gives OTT services the opportunity to
pursue diversified options for monetization and to pro-
vide consumers with more flexible options to satisfy their
preferences and price point.
There is no question that consumers are engaged
in OTT services and becoming more so. According to
Accenture research, online video consumption accounts
for 42% of consumers’ viewing time, but comprises only
23% of consumers’ viewing wallet. Although OTT ser-
vices are not yet reaping their fair share of market spend,
there is definite potential to grow revenue by aligning
these values and positioning OTT as a competitor to tra-
ditional PayTV to attract new viewers.