Recession hurts consumer spending, but broadband seen as essential

March 10, 2009

American consumers hit hardest by job losses and the economic recession are cutting back their discretionary spending, but a survey suggests subscription TV, broadband and mobile services may be too essential for consumers to cut out of their budgets.

In-Stat's recent survey found that a large majority of people said they will keep spending “about the same” on broadband, subscription TV and mobile services compared to a year ago, about 85 percent. Broadband service is among the most integral parts of consumers' lives, with over 66 million consumers reportedly using the Internet while watching TV.

"Some male age groups had 40 percent to 50 percent of respondents using a PC while watching TV, and about 30 percent of females under the age of 40 are also using a PC while watching TV," said Gerry Kaufhold, In-Stat analyst.

New approaches using online web portals synchronized to a TV program will continue to develop, Kaufhold said, because they present no new costs. Several companies are identifying new opportunities to marry TV viewing to a related website.

About 15 percent of survey respondents said they intend to cut back their spending across these three segments. The biggest decrease in spending on mobile, broadband and subscription TV services will come from households with income below $35K.

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