EY study: consumers are focused on getting value for money on connectivity and content

• Seventy-two percent of consumers want fixed price guarantees but are still receptive to premium services
• Forty-seven percent of households are very concerned about harmful content
• Achieving differentiation in the digital home marketplace is a challenge for providers

Households are keen on having a “digital detox” with 40% of consumer respondents concerned about the amount of time their household members are spending online. This is according to the latest EY decoding the digital home study, which surveyed 20,000 consumers on their attitudes toward technology, media and telecoms experienced in the home across 10 countries: Canada, France, Germany, Italy, South Korea, Spain, Sweden, Switzerland, the UK and the US.

While performance needs continue to drive consumers’ broadband purchasing decisions, network reliability remains a pain point with over one-quarter (26%; unchanged from last year) of household respondents still experiencing unreliable home internet, despite ongoing network upgrades. Streaming platforms continue to extend their reach into new content genres, with brand trust (41%) playing an increasingly important role in platform selection. Meanwhile, smart home adoption risks stalling with consumers voicing concerns about data security, cost and convenience, challenges that threaten to limit further adoption of connectivity and content products. Across the digital home, consumer respondents feel overwhelmed because of the volume of the choice on offer.

Pricing anxiety exists – but so does premium appetite

Anxiety over price increases remains pronounced with clear demand for fixed price guarantees. On average, 35% of household respondents are willing to trade down to cheaper broadband. Over two-fifths (43%) are receptive to ad-supported streaming to save on monthly subscription rates, but others are considering premium offerings. Demand across all markets that aggregate content at a premium price has risen to 44% compared with 40% last year.

On the connectivity side, there are various elements service providers can bring together to build premium offerings, with well over one-third (38%) of household respondents saying they’re open to paying more for broadband with attributes including: additional privacy, security and wellbeing features, good customer service, and backup connectivity in the event of network outages.

Cédric Foray, EY Global Telecommunications Leader, says:

“While some consumers are prepared to trade down to save money, there are clear indications of rising receptivity to premium connectivity and content offerings. Taking advantage of these positive signals will help providers justify a higher price point during a time when monthly rates are trending upward. Service providers have a unique opportunity to respond to this dynamic by offering new packages that exceed expectations in the services provided to help shape future customer relationships.”

Streaming market highly fluid

Value-for-money perceptions for connectivity and content are largely consistent year-on-year on average across all markets. However, the proportion of households agreeing they get value for money from streaming platforms has declined by five percentage points from 55% to 50%, indicative of a pricing environment where monthly subscription rates have doubled in the last 10 years, with some platforms increasing prices by upwards of 40% in the last year.

Consumers canceling platform subscriptions has also become a feature of the streaming market in recent years. This year, 29% of household respondents on average has canceled or plan to cancel at least one streaming subscription service, compared with 33% last year. Decisions to cancel are primarily driven by the need to cut costs (44%) and watching the service less than before (17%). It is worth noting though that a third are resubscribing to one or more services they previously canceled – a finding that underlines the importance of streaming platforms’ “win-back” strategies.

The downside to digital demand

Consumer fears over the amount of time spent online emerged clearly in the study’s findings (40%). The challenges posed by harmful content are also growing, with 47% very concerned, up from 44% last year. Households are alert to the potentially negative impact artificial intelligence (AI) could have on trusted content. More than half of households (56%) are very concerned that AI will make content less reliable, with an even higher proportion (62%) fearful of the role ‘bad actors’ could play in harnessing AI to create harmful content. Households believe that governments and regulators should be doing more to mitigate the potential downsides of AI (55%).

Changing value propositions

Bundles are becoming more important to consumers: 44% of respondents say the cost-of-living crisis has made them focus on buying connectivity and content from a single supplier, up from 40% last year. However, one-third of household respondents (35%) question the advantages of buying TV and broadband from the same supplier, underlining that bundle benefits are still subject to scrutiny. Thirty-five percent of household respondents would be willing to drop fixed broadband for a mobile alternative with a compelling price point and performance promise.

Customer experiences revisited  

The study further highlights that achieving differentiation in the digital home marketplace is a challenge for connectivity providers with 44% of household respondents seeing very little difference between them. Four in 10 consumer respondents still prefer going to physical stores first on the path to purchase – and half (51%) favor the call center for customer support. What’s more, chatbots are regarded as cumbersome, with respondents wanting digital tools that blend agent advice alongside better explanations of the role AI in sales and support interactions.

Adrian Baschnonga, EY Global Technology, Media & Entertainment and Telecommunications (TMT) Lead Analyst, says:

“Customer journeys still rely heavily on call center interactions and retail store visits, reflecting consumers’ continuing attachment to human advice. Improving the appeal of digital tools for both purchasing and support will enable providers to offer better choices to customers. For this to happen, providers cannot afford to ignore the demand for clearer explanations of the role of AI in customer interactions.”

Survey highlight: the growing importance of bundles to consumers

Pressures on household spending have prompted consumers to consider buying all their connectivity and content from the same supplier, a sentiment that has become more pronounced year-on-year. Perceived bundle benefits include cost savings (61%), the convenience of a single bill (60%) and the convenience of a single point of contact for customer services (59%).

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About the study

The EY Decoding the digital home study is based on an online survey of 20,000 households in Canada, France, Germany, Italy, South Korea, Spain, Sweden, Switzerland, the UK and the US. It was conducted in July and August 2024, updating previous annual surveys of multiple markets.

The annual survey is designed to build a deeper understanding of changing consumer behavior and attitudes involving technology, media and telecommunications products and services. This year’s findings focus on topics such as: adoption drivers and barriers, value for money perceptions; harmful content; bundle appetite and customer journeys, supported by specific, data-driven insights relating to connectivity, content and smart home technology. Additional analysis and insights are provided by the EY Global TMT team.