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NZers Embrace Internet Video Revolution

Australians and New Zealanders Embrace Internet Video Revolution, Cisco 'Connected Consumer' Study Finds

Broadband Users Watch Video Online Regularly and Show Interest in Storing Downloads; Implications Significant for Service Providers and Media

AUCKLAND - May 20, 2008 - Australian and New Zealand broadband users are spending considerably more time using the Internet than watching television or movies and are downloading video in significant numbers, a leading study by Cisco has found. The survey, one of the first of its kind in Australia and New Zealand, also concluded that Australasians are interested in the concept of a single platform for storing and managing their digital content.

The Cisco(r) "Connected Consumer" survey was carried by out last year by Illuminas amongst more than 1,000 Australian and New Zealand broadband users. It follows similar studies by Illuminas in the United States and Europe since mid-2006. The study sheds light on a wide range of broadband consumer behaviours and interests, from types of Internet access, to the extent of home storage of digital information, levels of wireless access, and use of mobile devices to access digital information.

Les Williamson, vice president of Cisco Australia and New Zealand, said: "The simple fact is the network is rapidly becoming the platform not only for businesses that want to increase efficiency and productivity, but also for consumers who are changing the way they interact with each other and a whole range of their favourite content. The Connected Consumer survey is another point of confirmation to show that broadband consumers are using the Internet to access video information in ever-increasing numbers, and it is up to Australian and New Zealand media and service providers to adapt to that change."

A key finding of the survey, carried out amongst 864 Australians and 219 New Zealanders in November 2007, was that in a typical week, each person spends an average of 47 hours engaging in media-related activities. Most of the time is spent on the Internet (22 hours) and watching TV (14 hours). This puts Australians and New Zealanders at the same level of media consumption as respondents in the United States (47 hours) and the United Kingdom and ahead of the four continental European markets surveyed (France, Germany, Italy and Spain)*. Australians and New Zealanders also spend more time on the Internet than individuals in most of the markets surveyed, except for Spain and the United Kingdom.**

The survey also discovered that those who do access the Internet on a regular basis via broadband networks are downloading video. The study found that 59 per cent of Australia and New Zealand Internet users watched or downloaded media content from the Internet in the previous 30 days. Short video clips or music videos are the most often watched or downloaded (38 per cent), followed by news programming (25 per cent). Consumers in New Zealand are significantly more likely to have downloaded or watched short video clips than those in Australia (47 per cent vs. 36 per cent, respectively). The most compelling factor behind watching content online that it is free (51 per cent). Convenience is also important for more than one-third of Australia and New Zealand consumers (37 per cent), as is the ability to view content missed when it originally aired (31 per cent).

The survey also found that when it comes to consumer choice in Australia, Telstra/Telstra BigPond is the clear leader (55 per cent) as the provider of multiple services such as cable, Internet, mobile phone, and video. Google and Optus Zoo each has 20 per cent of consumers considering it.

The survey also discovered that consumers in Australia and New Zealand own an average of seven devices, with almost everyone owning a mobile phone (96 per cent), desktop PC (88 per cent) and a digital camera (86 per cent). Thirty-nine percent of the consumers who have a mobile phone use it for gaming, and this is expected to increase to 42 per cent in the next year. Other content viewing on the mobile phone is done less often, but is also expected to increase in the next year.

When consumers were introduced to the concept of storing their digital media and content at a centralized service (without considering price), the majority of respondents (89 per cent) had at least some level of interest. The strongest opportunity exists among those consumers who are 'very' or 'extremely interested', representing 54 per cent of the combined Australia and New Zealand audience. Consumers in both countries are consistent in their expectations of an average monthly fee of $12 for such a service offering. Yet, when consumers were then asked their interest levels at varying monthly price points ($5, $10, $15 and $20), even price points in line with their expectations, interest levels declined.

"The key challenge for service providers is convincing the average consumer that a centralized digital media storage device will be easy to use and provide greater access to their digital content," said Jay Shutter, Illuminas' managing director. "Consumers want this type of device as both time and place shifting continues to change their digital media behaviour. Any new for-fee service would need to greatly improve on how they are currently accessing and consuming their digital content."

Illuminas is a full-service research consultancy with offices in London, Hong Kong, New York, and Austin, Texas. The Illuminas technology practice based in Austin has been researching global technology adoption trends for more than 15 years. Its research focuses on the impact of technology on consumers, businesses and global economies.

For more information about Illuminas, visit .

* Total average weekly media consumption was 47 hours a week in the UK, 40 in France, 44 in Germany, 44 in Italy, and 41 in Spain.

** Total average weekly time spent on Internet was 21 hours in the US, 22 in the UK,18 in France, 21 in Germany, 23 in Italy, and 19 in Spain.

About Cisco

Cisco, (NASDAQ: CSCO), is the worldwide leader in networking that transforms how people connect, communicate and collaborate. Information about Cisco can be found at For ongoing news, please go to .


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