"For communications companies that already have a firm stake in the home through traditional offerings such as video, broadband and voice, an unprecedented opportunity is up for grabs. As the connected home market quickly expands, blazing the trail in the emerging landscape will become increasingly non-negotiable to incumbents’ future growth and survival." —Shuvankar Roy, Comcast; and Sumit Banerjee and Abhinav Saksena, Accenture Strategy

Over the past decade, connected technologies have evolved from an abstract idea into something woven into the fabric of our everyday lives. Whether it’s switching off a forgotten light with your smartphone or jumpstarting your home’s smart entertainment systems via a simple request to Alexa, connected devices enabled via technologies such as artificial intelligence are reshaping consumer experiences as we know them. 

They’re also redefining the word ‘convenience.’ A recent Accenture Strategy study found that 56% of executives predict AI deployment will drive new growth and revenue opportunities. And nearly 6% say this revenue growth will come from increased consumer satisfaction and engagement.

Nowhere are these opportunities more apparent than in the connected home where, according to the U.S. Department of Labor, Americans spend more than half of their daily time. Today, products that once seemed futuristic are now common household items. There has been a 60% growth in smart speakers, while smart home products have increased by 41%. The future will see a collection of deeply integrated micro-ecosystems that will make the home intelligent, personalized and seamless.

For communications companies that already have a firm stake in the home through traditional offerings such as video, broadband and voice, an unprecedented opportunity is up for grabs. As the connected home market quickly expands, blazing the trail in the emerging landscape will become increasingly non-negotiable to incumbents’ future growth and survival.

Preparing for the Fight

In the fight to own the home, communications companies face an increasingly crowded and complex path ahead. Competition is fast expanding past traditional players to include Silicon Valley giants and other players looking for the next platform to reach consumers. 

A wave of recent M&A activity — such as Amazon’s acquisition of Ring — underscores that both traditional and new entrants are recognizing the major value of the connected home market, and acting accordingly. In fact, Accenture Strategy research finds that 43% of companies cited the need for next-gen technology as a trigger for their M&A as they race to win over consumers with top-of-market digital offerings.

As communications companies face multiple headwinds, including shifting customer presences and cost pressures, they must rise to the challenge and best position themselves in the fight to win. By facing barriers head-on, embracing new business models, and looking outside the four walls of their organization, communications players have a major opportunity to become the dominant and holistic service providers in consumer homes.

Confronting Challenges

To start, communications companies should recognize where they have advantages to seize — for instance, familiarity among consumers in the home space, and an existing suite of home services — and where vulnerabilities remain. For one, the connected home market differs significantly from communication providers’ core products. 

Many successful connected home products, such as Alexa and Nest Thermostat, are purchased through one-time sale — contrasting with the recurring subscription model typical of communications companies. This means communications companies will need to rethink their pricing models to reap the most benefit, while also finding ways to reduce cost-of-entry for consumers.

Another challenge facing incumbents is navigating a market built around product design and experience — features that haven’t been historically paramount to traditional communications providers’ offerings. To compete with companies such as Google and Amazon, who put product design at the core of their DNA, traditional companies need to accelerate investment in best-class product design and manufacturing, as well as transition culture and ways of working. Some companies are already making this shift in their business models — among them, Comcast, which is helping transform the video product experience with the release of X1.

In today’s day and age, companies also need to remember that they don’t always need to go it alone. In fact, doing so may prove to be a disadvantage. Instead, communications providers need to decipher how and where they want to participate in the connected home ecosystem, so they are best able to bolster traditional portfolios, bring differentiated offerings to market and reach new segments of consumers. 

Accenture Strategy research has found that nearly half (44%) of executives across industries agree the value of ecosystems lays in access to new customers. As lines blur between industries, there are also new opportunities to partner with “frenemy” companies to create new integrated experiences and put down a lasting stake in the connected home experience.

The Path to the Finish Line

In an increasingly complex and crowded industry, there are several steps communications companies can take to stay ahead of the curve and own a connected home market share:

• Form an Integrated Strategy: Evaluate new opportunities in the context of traditional products and services, with an eye toward creating integrated service offerings that allow you to both dominate the old and win in the new. Create a refreshed home services aggregation strategy that defines a path forward for both defending core services and expanding to new revenue streams through digital offerings. Create new, holistic business and pricing models that give consumers a more seamless exchange on everything from user experience, service, billing and beyond.
• Shift Focus to Design and Experience: Refocus priorities to place design and experience at the forefront of service offerings, which is necessary for keeping up with Silicon Valley rivals and emerging players.
• Redefine your Role in the Broader Home Ecosystem: Ask yourself: what role should your company play in the broader — and rapidly expanding — connected home ecosystem? What gaps remain in your company’s capabilities, and where can a digitally savvy partner create a distinct advantage? Think outside your four walls to embrace non-traditional partners, including longtime rivals, to create differentiated product offerings, expand market share and provide best-in-class experiences to consumers.
• Embrace Data: Create an analytics strategy to power the home business. Ecosystems will soon evolve from value chain partnerships, in which each entity has a specific function, to information exchanges that drive new opportunities to leverage and monetize data. Through investments in analytics combined with strategic partnerships, companies can access rich data insights that enable them to better service customers and ultimately drive growth.

As connected devices become more ingrained into consumers’ everyday lives, the connected home space has grown to be a major market opportunity, creating a fierce battleground between traditional and emerging companies alike. If incumbent communications players develop bold visions, rethink long-held business models and make strategic bets today, they can find themselves victors in the connected home race of the future.

Shuvankar Roy is vice president of business operations at Comcast; Sumit Banerjee is managing director at Accenture Strategy; and Abhinav Saksena is a former managing director at Accenture Strategy.

Home tech enthusiasts cite "peace of mind" as the main reason to invest in smart home technology.

That is according to a new Scripps Networks Interactive survey of 612 homeowners; the study also found that homeowners are often wooed to smart home tech via a gift.

Scripps said personal recommendations are the top driver of home tech buy, and that getting a tech gift "feels" like a recommendation from a friend.

The survey, drawn from Scripps's panel of self-described "home enthusiasts," was conducted in October 2017.

Almost three quarters of respondents said they "love" having the latest and greatest in home tech, like the Amazon Echo or devices from Nest. An equal percentage said they thought that home tech made them better parents.

A Nest for the New Nest
The survey found that three "life events" help prompt connected home purchases: home renovations, moving into a new home and a boost in household income.

But while homeowners want all that new gear, they don't want it advertising itself. One of the draws of the devices is that they are seamless and thus somewhat "forgettable ... in that physically and psychologically unobtrusive devices allow the household to operate in a focused and balanced manner, free of technological complication," a Scripps spokesperson said.

Demand for smart home tech is lower in the kitchen, however; there it is considered a "nice-to-have" rather than a must-have. More than a third of respondents said they were not interested in connected kitchen appliances and did not see much utility beyond the "gee whiz" factor.

The global smart home device market will increase to $31.4 billion in 2018 from $27.5 billion in 2017, and will almost double by 2022 to more than $53 billion, according to data aggregator Statistica.

Global viewing of over-the-top video content more than doubled last year to 12.6 billion hours, according to a new report by Conviva.

Viewing was done on more than 2.4 billion devices, up 9%, Conviva said. The U.S. accounted for 58% of OTT viewing, followed by Europe with 21%, Asia with 19% and the rest of the world with 2%.

“Conviva has seen the viewing hour growth rate accelerate over the past several years as more consumers move their TV-watching from traditional linear pay TV services to a very wide variety of OTT services offered by both pure play OTT publishers and MVPDs, as well as pay TV providers diversifying their service offerings,” the company said in its Streaming Market Year in Review report. “Conviva expects to see continued accelerated growth over the course of 2018 across both existing and new customers.”

The data in the report is based on Conviva customers, which the company said cover close to 60% of the internet population. The company measures seven out of the top 10 SVOD providers in the U.S., as well as other OTT providers globally.

The number of views initiated in 2017 rose 74% to 38.8 billion, with 54% of those in the U.S.

By December, 64% of traffic on Conviva’s platform came through video apps, compared with 36% from watching video through browsers. That’s the opposite of the year prior. Video app activity grew 160%, while browser video rose 23%.

As many as 1.04 billion unique streaming apps reside on devices in the U.S., with 2.2 apps per device and 2.9 devices per person.

Conviva said the peak in concurrent video connections was 9.75 million, with spikes for both live sports and original content.

In-home devices, such as the Xbox and Roku platforms, showed the highest completion rate for video programming at 46%, with 71% growth in viewing time per device, Conviva said. Streaming video programming was more likely to be interrupted when viewed on a mobile device.

In terms of quality of OTT video, Conviva said that of the 47.1 billion attempts to start watching a video, 38.8 billion were successful. It took an average of 4.84 seconds for a video to start, a 23% improvement from the previous year.

Related: DirecTV Now Customers Suffer Outages, Buffering

Buffering issues improved slightly. While watching a half-hour show, the average viewer spent 0.95% of the time, or less than 18 seconds, waiting for video to rebuffer.

“The OTT market continues to see explosive growth not only in the number of viewers, but the amount of time spent viewing as well,” Conviva said.

As streaming becomes more popular as a way to consume TV programming, Roku is increasing the number of homes in which its devices are used, according to a new report from Parks Associates.

In the first quarter, Roku's leading share of the streaming media player market in the U.S. grew to 37% from 30% a year ago.

The gain puts Roku further ahead of competitors including Amazon, Google and Apple.

"Roku emerged early as a U.S. market leader for streaming media players, and the company has held firmly to that position," said Glenn Hower, senior analyst at Parks Associates. "Higher-priced devices, such as the Apple TV, have not been able to keep up with low-priced and readily available Roku devices, which can be found at Walmart for as low as $29.99."

Amazon’s Fire TV increased it share to 24% from 16% in the quarter. Google’s Chromecast dropped to 18% and Apple TV fell to 15%, according to Parks.

“One-third of U.S. broadband households own a streaming media player," Hower said. "The growth of the U.S. OTT market provided consumers with unprecedented ease of access to video content. These streaming media devices make for quick and easy access to the top OTT libraries."

The Parks report, Reinventing CE: Transforming Devices to Service Platforms, looks at how the CE industry has migrated from producing and distributing hardware to distributing OTT content and leveraging advertising models.

We live in a time when there is an insatiable appetite for video. Ultra short-form content is taking over with Snap, Facebook, and Instagram stories. If your children were born in the last decade, then chances are they were introduced to digital video before they could talk.

The takeaway for service providers is that the competition for eyeballs is fierce and it's only going to get more intense over the next five to 10 years. Staying on top of these trends requires a micro-level understanding of how your audience is engaging with your content. It's all possible with TV Apps.

TV Evolved
TV is evolving in a big way. It's everywhere. Yes, in our living rooms, but also in our pockets. TV means something different for the current generation than it did for us Gen Xers. It means watching what you want when you want to watch it. There are now hundreds of OTT services launching TV apps that are personalized to best suit their audiences' viewing patterns. TV at your fingertips, whenever you want it, and personalized for you? Sorry, there's no going back.

There should be no more disputing the effect that OTT is having on the cable industry, an industry that was once impenetrable from outside competition and disruption. And the cord-cutting movement shows no signs of slowing down anytime soon.

So What Defines a TV App?
A TV app delivers content to a viewer over the internet and on one of a plethora of internet-connected devices, such as Roku, Apple TV, Amazon Fire TV, and Smart TVs. An app developed and deployed on any of these devices for the purpose of delivering video to a viewer is referred to as a TV app. Netflix, Amazon, and Hulu have deployed TV apps across a variety of internet-connected devices freeing us from pre-programmed content and enticing us to "cut the cord." Whether or not you are a cord-cutter, TV apps are becoming the primary vehicle for viewing today's most popular movies and TV shows. It's important to note that "TV" is being de-coupled from the "Television" in our living rooms. TV is everywhere now.

OTT Services Are Data Driven
OTT, or over-the-top, services allow consumers to watch live and on-demand TV outside of traditional cable services. OTT services are delivered to consumers primarily through TV apps. These apps enable media companies to deliver a much more personalized viewing experience. Also, providers can create detailed metrics for tracking user behavior over the aggregate. Are viewers browsing more than their watching? If so, maybe it's time to reorganize the content. Is the user-interface intuitive enough for my target demographic? Without the proper analytics in place, providers will never know. Basic video analytics isn't sufficient, and often, the platforms that are delivering the video aren't able to capture the app-level analytical information that's required to paint the complete picture.

A Brand-Specific Experience
One of the distinct advantages of TV apps is they can deliver a brand specific experience. And for the media companies moving over to OTT, while trying to enhance engagement and viewership, this is critical. Not only do today's consumers have more control over their viewing patterns, but providers can understand more about their audiences than ever before. Also, having an app that is specific to a particular brand allows that brand to immerse the user and present information whenever and wherever possible. TV apps are a powerful platform for increasing a brand's position in the market.

Engagement and Personalization = Retention and Acquisition
What specific content drives engagement? How long are they watching? How many ads can they tolerate? If I want to have a subscription or transactional viewer, what's the proper price point? Without a firm understanding of these data points, providers will struggle to stay ahead of their audience and keeping them engaged will be next to impossible. Engagement, personalization, and a solid user-experience are required for subscriber acquisition and retention when it comes to OTT.

TV Apps Are the Last Mile
The TV App experience represents the last mile - the culmination of a tremendous amount of work that has gone into the creation or aggregation of a library of high-quality content. Business plans, product plans, roadmaps, production schedules, blood, sweat, and tears... After all that, is there any point in packaging this into a "so-so" viewing experience? Of course not.

When a media company delivers a brand-specific experience to their audience, they create a more personal connection with them which allows them to understand their needs better. 

Doing It Vs. Doing It Right
The biggest barrier to the OTT market is deploying TV apps across a variety of diverse platforms. It also requires an intimate understanding of the OTT ecosystem, platform SDKs, online Video platforms (OVPs), analytics, entitlement, monetization, etc... TV Apps often require dozens of third-party services properly integrated and configured to deliver the expected experience as well as report the correct information back to the service provider.

It's like the cross-country road trip you've been planning for months - the vehicle is essential to maximize the experience.

Vendors that offer TV Apps to service providers should have a proven track record of deploying OTT-specific services. Developing the apps isn't enough—it requires a deeper understanding of the ecosystem and how the various components are needed to work together. Considering how much effort it takes to develop and or acquire engaging content, the TV App should not be an afterthought; in fact, it's the most important part of the equation.

Thomas Schaeffer is CEO of Float Left, a Jupiter, Fla.-based developer of custom TV apps. Photo by KidStock/Getty Images

comScore said it has launched a new product called Connected Home that measures consumer usage of devices linked to the internet and home networks, including computers, mobile phones, tablets, streaming sticks, smart TVs, thermostats and other appliances.

It's comScore’s first syndicated product based on its Total Home Panel, which measures device usage within the home. The Total Home Panel will also be a part of comScore cross-platform TV measurement products.

Subscribers to comScore Connected Home will get data on device penetration, usage frequency, engagement time, household demographics, manufacturer and brand market share and cross device activity patterns.

comScore has been in a bit of a funk since last year when it announced an investigation into the way it had accounted for certain non-monetary transactions. Since then senior executives have left, the company has been delisted from NASDAQ and has spent more than $39 million on consultants to try to get its financial records in shape.

Read more at broadcastingcable.com.

Digital Media Rights has more than 8,000 TV shows and movies under license, and it’s moving ahead with an ambitious plan to put them all to good use amid the rise of over-the-top video consumption.

DMR, which already distributes some of its fare through digital deals with Amazon Prime, Hulu and Netflix, has plans to launch six subscription-based over-the-top services before year-end.

Following the earlier debuts of two of those services — Midnight Pulp (horror and thriller titles, relaunched in February) and Asian Crush (pan-Asian content, relaunched in April) — DMR has hit go on Yuyu, a general-entertainment service offering content in more than a dozen categories and genres, including “Binge Worthy” television, “Stranger Than Fiction” documentaries and “Tour de Force Performance.”

DMR hasn’t announced the other three SVOD services that are in the works, but its current offerings each cost $4.99 per month. Its latest, Yuyu, is launching with more than 350 titles, including Johnny Suede with Brad Pitt, 95 Miles to Go with Ray Romano, crime documentary Where Is Robert Fisher? and Misfits, a story about LGBT teens in the heart of the Bible Belt.

Yuyu was available at launch via Roku players and Roku TVs, mobile devices and Web browsers, with development underway for Apple TV, Amazon Fire TV, Sony smart TVs and Google Chromecast.

As suggested in its tagline, “TV That Isn’t Basic,” Yuyu wants to offer content that fills the niche between traditional cable-network protgramming and the premium content available on YouTube.

“It’s a very exciting time for independent publishers,” DMR CEO Michael Hong said. “We kind of want to bridge the gap.”

Offering curated independent content puts Yuyu on a level playing field on platforms like Roku while also “competing quite nicely and, in some cases, beating some of the cable channels that are out there,” he added. “That’s what we love about this new kind of paradigm.”

Because Yuyu is digital, it can put forth a multitude of formats, including feature-length films, sitcoms, dramas and documentaries. “We’re not about [filling] programming gaps that are obscure or marginal,” he said. “We’re talking about huge, impactful genres that the traditional networks are totally missing the boat on.”

Hong called digital and TV content producer Vice Media an “inspiration” for Yuyu, because it has been successful at identifying key genres that have tremendous value for consumers. “We’re trying to tap into that.”

Though DMR distributes content on Amazon and Hulu, which are like video “department stores,” the plan is to create “unique boutique” OTT services, Hong said, noting the company will also augment its SVOD offerings with exclusive titles and early windows.

DMR has international rights for most of its content, Hong said. While the initial focus is on the U.S. and Canada, the company intends to later expand to other English-speaking territories.

Hong is also aware that the OTT SVOD market is getting crowded. Rather than just focusing on videos, he said DMR’s services will also look to capture the “culture” behind them.

“Over time, the goal is about engagement and building the community,” he said, noting forays into social media, for example. At last check, Asian Crush had 76,298 “likes” on Facebook, while Midnight Pulp has about 26,206.

“That’s really fulfilling the potential of digital,” Hong said of those community-building aspects. “We don’t want to just be a total lean-back experience that you find with cable.”

For now DMR, a private company established in 2010, will market its SVOD services on its own rather than strike deals with streaming aggregation services such as Amazon’s new Streaming Partners Program or VRV, a service launching later this year from Ellation.

DMR is already making good money by distributing content on Amazon Prime, Hong said.

“Those [SVOD aggregation] services, I think, work best for companies that have been around for a while. You can kind of get lost in the shuffle, if you’re a new company,” Hong said, allowing that “eventually it might make sense to be on those platforms.”

As coverage of the cantankerous and unpredictable 2016 political election season draws big TV ratings for traditional cable-news networks, upstart channels targeting young millennials with political-themed content are campaigning online to reach one of the largest voting blocks in U.S. history.

Networks like Fusion, Revolt TV, Pivot and Fuse are looking to secure the votes of a politically engaged group of 18-to-34-year-olds looking for content that speaks to issues important to them — topics that aren’t always addressed by the cable news channels.

From online voter registration campaigns to millennial-focused reports from the major political party conventions to social-media initiatives on key issues such as immigration, police brutality and LGBT rights, network executives said it’s critical to provide content to millennials when and where they want it.

“We have seen from our audience that they are an active, socially relevant group, and they care about issues that can affect not only them but society at large, from Black Lives Matter to [the drinking-water crisis in] Flint to immigration issues and LGBT issues — this audience is vocal and they care about these issues,” Revolt TV CEO Keith Clinkscales said. “We wanted to make sure that we were uniquely positioned to impact the political conversation, and give the young people who consume our media an opportunity to amplify their voices.”

CROSSING PLATFORMS

To accomplish that, networks are taking a multiplatform approach to disseminating political news to an audience that watches less TV and spends more time online, executives said.

Millennials aged 18-34 may watch less live TV than any other demographic group, but they’re the most likely to use a connected-TV device such as Apple TV or Roku, according to a new Nielsen Total Audience Report for fourth-quarter 2015.

That age group also spent more than 11 hours per week using smartphones to access the Web and apps during fourth-quarter 2015, up from eight hours during the same period in 2014, according to Nielsen.

Millennials have followed the 2016 presidential campaign closely because the candidates have been so active on social media, David Quinn, senior brand lead for digital marketing firm Beamly, said.

“All the candidates are active on Twitter and using video on YouTube and have remained active in the political conversation with millennials,” Quinn said.

That leaves an opening for millennial-targeted networks to provide political content to an already engaged audience.

For Fuse, that means teaming with Hispanic-targeted, non-profit political organization Voto Latino to create a multiplatform initiative dubbed “Crash the Parties,” Fuse Media CEO Michael Schwimmer said. Millennial Latinos can vie for a chance to become Fuse reporters at the Republican National Convention in Cleveland and the Democratic convention in Philadelphia.

Would-be reporters can submit a video to Fuse.tv for network viewers to vote on. Two winners will be chosen to represent the network at the conventions, providing frequent video updates both online and on he linear channel.

The network (then called Sí TV) ran a similar campaign with Voto Latino in 2008. “With the social media tools that are available in 2016 that were not available in 2008, it’s going to be even easier and more effective in getting out the word and getting people engaged in the process,” Schwimmer said.

Revolt’s “Revolt 2 Vote” initiative will include a weekly digital series on the revolt.tv website, featuring interviews with political leaders and insights from millennial thought leaders and influencers, Clinkscales said.

The music channel’s primarily digital political content will be headed by millennial journalist Amrit Singh as well as a “kitchen cabinet” of young political voices who will discuss the campaign on Revolt.tv and social-media outlets such as Twitter, Facebook and Instagram.

“The main thing is we have digital coverage because that’s where millennials are aggregating political content, and then we’ll do some linear programming as well,” he said.

As some 93 million millennials will be of voting age going into this year’s election, Clinkscales said it’s imperative to provide them information to make informed decisions.

“More than 30 million young people stayed home in 2012,” he said. “[Turnout] was very low — one of the lowest numbers on record. The frustration that young people have with the American political system is an opportunity to make sure we provide them with the engagement they need.”

The emerging networks are also hoping to reach millennial viewers in a way the bigger, more mainstream news networks haven’t so far. While both Fox News Channel and CNN ranked among the top 10 most-watched cable networks among total viewers during the first quarter 2016 among total viewers, neither is among the top 15 networks within the 18-49 demo, according to Nielsen.

“Millennials are not turning on the TV and watching the cable news networks,” Quinn said. “The shows that are speaking to the group are from external video Web shows.”

“They have their hands full,” Clinkscales said. “We have the luxury of going after one of America’s largest generations ever — 93 million strong and 40% from communities of color. This is the time to understand what’s going on with this 18-to-34-year-old audience.”

GOING TO THE MOVIES

Pivot will take a different tack to inform millennials about the political process, relying on politically-themed movies throughout the summer to keep politics on the minds of its younger viewers, Pivot general manager Kent Rees said.

The network will feature such films as All the President’s Men, Wag the Dog and The Fog of War.

“We’re more contextualizing the political process through these films that we’ve identified,” Rees said. “Millennials crave context and they crave it in all different directions, and having them sit down and watch a fi lm that comments on the process in general as well as documentaries like Caucus that touch on how the process works.”

The network will feature around the #justvote public-awareness campaign, which encourages young people to register and vote. Rees said there often isn’t a lot of information in the marketplace as to how to vote, so the eff ort will explain the process to help get millennials to the voting booth.

“Their involvement is clear, and it’s a great way to galvanize them,” Rees said. “It’s the largest generation in American history, and they’ve only just begun to understand their power and the opportunities to affect change in the country at large.”

For the first time, a majority of U.S. viewers have TV sets connected to the Internet, according to data released today by Frank N. Magid Associates and advertising software maker TubeMogul.

Connected TV penetration -- through gaming consoles, set-top boxes and smart TVs -- has more than doubled from 26% of U.S. households in 2013 to 53% this year. The study, based on Magid's online polling of 2,400 Americans last June, found the number rises to 64% among Americans ages 19 to 37.

The trends outlined in the study have broad implications for programming, distribution, advertising and every other corner of the TV and video marketplace. They've been hotly debated throughout this year's edition of the International Consumer Electronics Show in Las Vegas.

The means of connection have also shifted along with the rise in households. In 2013, 64% of connected homes went through a gaming device. This year, that number decreased to 45%. Smart TV connection grew from 29% to 38%, while Roku’s penetration increased 91% to 21% of households. Similarly, Google Chromecast netted a 14% share in less than two years on the market.

This influx of hardware follows directly behind the expansion of content options. In 2015, subscriptions to Netflix, Hulu, or Amazon Instant Video increased by almost 10 percentage points over 2014 levels, to 62% among the general population and 76% among consumers ages 19-37.

Read more at broadcastingcable.com.

About half of U.S. homes now own a connected TV device, a category that spans connected TVs, game consoles, streaming players and Blue-ray Disc players, NPD Group found in a new study.

The number of homes with a connected device stands at about 46 million, up 4 million since Q2 2014, NPD Group found its new report.

The research firm’s retailing tracking service discovered that that 45% of TVs sold in the U.S. in the second quarter of 2015 supported apps, up from 34% last year, and up from 24% two years ago. Consumers are also connecting those TVs to the Internet at increased rates, as 69% of all installed Internet-capable TVs were connected, versus 61% last year, and 45% in 2013.

Among individual apps, Netflix retained its crown as the most commonly used OTT video services in Q2 2015, followed by YouTube, Amazon Prime/Instant Video, Hulu and HBO Go and HBO Now, the programmer’s new standalone OTT subscription offering.

 “The increase in the number of homes that use a TV with apps is the result of three very important factors,” said John Buffone, NPD Group’s executive director, Connected Intelligence, said in a statement. “Sales of TVs with apps have skyrocketed, their user interfaces have improved and there has been a surge in available premium services and programming.”

NPD Group based its findings on a survey of more than 5,000 U.S. consumers age 18 and older throughout the second quarter of 2015.