Description

Providing the most comprehensive and up-to-date information and analysis of the US Home Entertainment Technology: Hardware & Services market, including the behaviors, preferences, and habits of the consumer.

Consumer spending on home entertainment technology is estimated at about one quarter of a trillion dollars in 2021. Spending for both hardware and services has grown consistently, though is expected to increase even more rapidly vs historical estimates, with an overall annual increase of 11.2% for 2021 for the category, overall. The COVID-19 pandemic has changed consumer priorities and altered consumer behavior that is driving overall spending on the category.

Growth in home entertainment hardware spending for 2021 will be driven largely through spending on new televisions. More than half of consumers say their households purchased a new TV within the past two years, and there has been an increase in high-end TV purchases. Young adults are a key segment as these more tech savvy consumers are embracing the suite of tech products available to elevate the home entertainment experience, whether it is high-end TV models, next-generation video game consoles, or wireless speakers.

Services spending has also grown significantly as consumers shift toward more digital-based entertainment like on-demand video and audio streaming, as well as vMVPD services like YouTubeTV and Sling. Even as the economy recovers, businesses reopen and outside the home leisure activities return, the growing consumer focus on the home will continue to drive overall growth in home entertainment spending.

Read on to discover more about the US Home Entertainment Technology: Hardware & Services consumer market and home entertainment technology trends, read our US Home Office and Classroom Technology: Hardware & Services Market Report 2021, or take a look at our other Technology And Telecoms Industry research reports.

Quickly understand

  • Household TVs are getting larger, sharper and smarter.
  • Nearly half of consumers plan to host a party/gathering in the next six months.
  • TV, furniture and sound systems are the most important features of an entertainment room.
  • Strong demand for connected home entertainment technology.

Covered in this report

Brands include: WarnerMedia, Disney, Oculus Quest, PlayStation 5, Xbox, HBO, YouTube TV, Sling, Sony, Samsung, LG, Steam, Netflix, Disney+, ESPN+, Hulu, Fox Entertainment, Microsoft, AT&T, WarnerMedia, Discovery, Blaston, Bulgari, Chromecast, Amazon Fire Stick, Apple TV, Amazon Echo, Google Home.

Expert analysis from a specialist in the field

This report, written by Buddy Lo, a leading analyst in the Technology and Consumer Electronics sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The COVID-19 pandemic forced consumers to re-evaluate their relationships with their homes and has spurred wider investment into their home entertainment devices and services. From ultra-high-definition TVs, next-gen video game consoles to wireless speaker systems, consumers are embracing new digital innovations that elevate the home experience and will continue to seek new solutions that will improve the time spent at home for both themselves and future guests.

Buddy Lo, Senior Technology Analyst
Buddy Lo
Sr. Technology and Consumer Electronics Analyst

Table of Contents

  1. Overview

    • What you need to know
    • Definition
    • Market context
    • Economic and other assumptions
    • COVID-19: US context
  2. Executive Summary

    • Top takeaways
    • Market overview
    • Impact of COVID-19 on home-entertainment hardware and services
      • Figure 1: Short-, medium- and long-term impact of COVID-19 on home-entertainment technology, 2021
    • Opportunities and challenges
    • High-end TVs replace older models, helps keep families content with their entertainment
      • Figure 2: Most recent TV purchase – connectivity, resolution, and size, 2020 and 2021
    • In response to pandemic, studios pivot to bring more content direct to consumers
      • Figure 3: Attitudes toward home-entertainment tech – digital rentals vs movie theaters, by party hosting plans and parental status, 2021
    • Virtual reality headsets finally find a foothold
      • Figure 4: Entertainment device ownership and interest – VR headset, by generation, 2021
    • Global computer chip shortage puts pressure on manufacturers
    • Red-hot housing market and increase in first-time buyers spurs spending on the home
  3. The Market – Key Takeaways

    • Significant growth for home entertainment technology underway for 2021
    • Spending on TVs drives rising hardware sales
    • Streaming spending grows while live TV stems yearly declines
    • Lowering concern over COVID-19 could be upended by the Delta variant
    • Government stimulus and relief spending bolsters consumer spending
    • Global computer chip shortage limits inventory and raises prices
  4. Market Size and Forecast

    • 2021 will be a banner year for home entertainment spending
      • Figure 5: Total US consumer expenditures and fan chart forecast for home entertainment hardware and services, at current prices, 2016-26
      • Figure 6: Total US consumer expenditures and forecast for home entertainment hardware and services, at current prices, 2016-26
    • Impact of COVID-19 on home entertainment
      • Figure 7: Worry about COVID-19 exposure and lifestyle disruption, March 2020 – July 2021
      • Figure 8: Comfort going to the movies, May 2021 – July 2021
      • Figure 9: Comfort going to a live event, May 2021 – July 2021
  5. Segment Performance

    • Home entertainment hardware spending expected to surge for 2021
      • Figure 10: Total US consumer expenditures and fan chart forecast for home entertainment hardware, at current prices, 2016-26
      • Figure 11: Total US consumer expenditures and forecast for home entertainment hardware, at current prices, 2016-26
    • Streaming services drives spending
      • Figure 12: Total US consumer expenditures and forecast for home entertainment services, at current prices, 2016-26
      • Figure 13: Total US consumer expenditures and forecast for home entertainment services, at current prices, 2016-26
  6. Market Factors

    • Preventative measures return as COVID-19 variants rapidly spread
    • Government stimulus and relief packages sustained household spending
      • Figure 14: CBO estimates of US GDP and effects of pandemic stimulus legislation, Q1 2020 – Q4 2021
      • Figure 15: Personal consumption expenditures, Q1 2020 – Q2 2021
    • Home sales surge 20% in 2020
      • Figure 16: US home annual home sales, 2010-20
      • Figure 17: US home monthly home sales, January 2010 – June 2021
      • Figure 18: Share of first-time home buyers, by age, 2020
    • Computer chip shortage impacting key categories in home entertainment
    • TV prices increase as much as 30% for high-end models
    • Retailers unable to meet demand for the latest video game consoles
  7. Companies and Brands – Key Takeaways

    • Samsung leads global TV market for 15th consecutive year
    • LG targets high-end consumers with Signature line and first rollable TV
    • Netflix’s North American memberships stall while revenues grow
    • Disney continues to innovate and focus on streaming platforms
    • Facebook’s Oculus leads VR market despite recalls on the Oculus Quest 2
    • Sony and Microsoft battle it out in console sales and game subscriptions
  8. Market Share

    • Samsung’s TVs lead the global market
    • Xbox Live passes 100 million monthly active users
      • Figure 19: Daniel Ahmad Xbox Series X|S estimates, July 2021
    • PlayStation Plus reaches 47 million active subscribers
    • Sony announces it has secured computer chips for PS5 production targets
    • Netflix North American paid memberships plateau in first half of 2021
      • Figure 20: Netflix North American revenues and paid memberships, 2017 – Q2 2021
    • Disney suite of streaming services sees major success
    • Facebook’s Oculus leads VR market
    • Alternative VR brands can erode Facebook’s leading position
  9. Competitive Strategies and Opportunities

      • Figure 21: Mintel Trend Drivers and supporting Pillars – Technology
    • Disney makes ESPN+ available on its Hulu platform
    • AT&T spins off WarnerMedia to Discovery
    • Facebook trials ads in Oculus VR environment
      • Figure 22: Blaston Twitter post, June 2021
    • LG targets the ultra-high-net-worth with its Signature line and luxury brand collaboration
  10. The Consumer – Key Takeaways

    • TVs are getting bigger, sharper and smarter
    • Gen Z and Millennial gamers drive VR headset ownership
    • Half of consumers plan to host a party/gathering this year
    • Six in 10 consumers spent more time at home due to COVID-19
    • Robust demand for connected home entertainment devices
    • Nearly half fall under the Digital Entertainers consumer segment
  11. Most Recent TV Purchase

    • One in five households purchased a TV in the past six months
      • Figure 23: Most recent TV purchase – timing, 2020 and 2021
    • Younger men drive TV purchasing
      • Figure 24: Most recent TV purchase – timing, by gender and age, 2021
    • Household income has minimal impact on purchase rates
      • Figure 25: Most recent TV purchase – timing, by household income, 2021
    • TVs are getting larger, sharper and more connected
      • Figure 26: Most recent TV purchase – connectivity, resolution, and size, 2020 and 2021
    • Middle class splurges on high-end TVs despite price increases
      • Figure 27: Most recent TV purchase – connectivity, size and resolution, by household income, 2021
      • Figure 28: TVs purchased within the past six months – connectivity, size and resolution, by household income, 2021
    • Hispanic households on par with White households in high-end TV purchasing
      • Figure 29: Most recent TV purchase – connectivity, size and resolution, by race/Hispanic origin, 2021
  12. Entertainment Device Ownership and Interest

    • Streaming devices lead overall household device ownership
      • Figure 30: Entertainment device ownership and interest, 2021
    • Gen Z and Millennial gamers will drive household VR adoption
      • Figure 31: Entertainment device ownership and interest – VR headset, by generation, 2021
  13. Party Hosting Plans

    • Nearly half plan to host people at home within the next six months
      • Figure 32: Party hosting plans within the next six months, 2021
    • Fathers most likely to host a gathering in the next six months
      • Figure 33: Party hosting plans within the next six months, by gender, age, marriage and parental status, 2021
    • Party hosting correlates with household income and device ownership
      • Figure 34: Party hosting plans within the next six months, by household income, 2021
      • Figure 35: Entertainment device ownership and interest, by generation, 2021
      • Figure 36: Most recent TV purchase – connectivity, size and resolution, by plans to host a party/gathering in the next six months, 2021
  14. Devices for Party Hosting

    • Big screen TVs top devices for party hosting
      • Figure 37: Devices for party hosting, 2021
    • Gen Z most interested in gaming, karaoke and social media integration
      • Figure 38: Devices for party hosting, by generation, 2021
    • Younger women interested in audio-based devices and services
      • Figure 39: Devices for party hosting, by gender and age, 2021
    • Ideal home entertainment system for hosting
      • Figure 40: TURF Analysis – party devices, 2021
  15. Important Features of an Entertainment Room

    • TV, furniture and sound systems are the most important features
      • Figure 41: Important features of an entertainment room, 2021
    • Older consumers focus on TV and sound – while younger consumers consider video games as an important feature
      • Figure 42: Important features of an entertainment room, by age, 2021
    • Presence of children elevates value of video games for entertainment
      • Figure 43: Important features of an entertainment room, by parental status, 2021
  16. Home Entertainment Behaviors

    • Six in 10 consumers stayed home more due to COVID-19
      • Figure 44: Home entertainment behaviors, 2021
    • Parents far more active in the home entertainment space
      • Figure 45: Home entertainment behaviors, by parental status, 2021
    • Party hosts plan to spend less time at home in the next 12 months
      • Figure 46: Home entertainment behaviors, by party hosting plans, 2021
  17. Attitudes toward Home Entertainment Tech

    • TV is essential for a home entertainment room, but not necessary for every type of party
      • Figure 47: Attitudes toward home entertainment tech – TVs, 2021
      • Figure 48: Attitudes toward home entertainment tech – TVs, by gender and age and party hosting plans, 2021
    • Saving money is a top reason – but not the only reason – for spending leisure time at home
      • Figure 49: Attitudes toward home entertainment tech – Home vs public, 2021
      • Figure 50: Attitudes toward home entertainment tech – digital rentals vs movie theaters, by party hosting plans and parental status, 2021
    • Demand for connected devices growing
      • Figure 51: Attitudes toward home entertainment tech – speakers and devices, 2021
      • Figure 52: Attitudes toward home entertainment tech – speakers and devices, by gender and age, 2021
  18. Consumer Segmentation – Attitudes toward Home Entertainment

      • Figure 53: Home entertainment technology consumer segments, 2021
    • Disconnected Recluses (23%)
    • Characteristics
      • Figure 54: Profile of Disconnected Recluses, 2021
    • Opportunities
      • Figure 55: Attitudes toward home entertainment tech – home vs public and party hosting plans, by consumer segments, 2021
    • Digital Entertainers (48%)
    • Characteristics
      • Figure 56: Profile of Digital Entertainers, 2021
    • Opportunities
      • Figure 57: Devices for party hosting, by consumer segments, 2021
    • Outside Leisure Seekers (29%)
    • Characteristics
      • Figure 58: Profile of Outside Leisure Seekers, 2021
    • Opportunities
      • Figure 59: Home entertainment behaviors, by consumer segments, 2021
      • Figure 60: Attitudes toward home entertainment tech, by consumer segments, 2021
  19. Appendix – Data Sources and Abbreviations

    • Data sources
    • Sales data
    • Forecast
    • Consumer survey data
    • Consumer qualitative research
    • Marketing creative
    • Abbreviations and terms
    • Abbreviations
  20. Appendix – The Market

      • Figure 61: Total US consumer expenditures and forecast for home entertainment hardware and services, at inflation-adjusted prices, 2016-26
      • Figure 62: Total US consumer expenditures and forecast for home entertainment hardware, at inflation-adjusted prices, 2016-26
      • Figure 63: Total US consumer expenditures and forecast for home entertainment services, at current prices, 2016-26

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