IPTV and cable video equipment up 15% in 2Q09

M&A activity expected

CAMPBELL, CA — Market research firm Infonetics Research released its second quarter (2Q09) IPTV, Cable, and Satellite Video Equipment, Services, and Subscribers report.

Analyst Note

“Slow but steady IPTV and cable video subscriber growth in North America, Europe, and Asia, led by AT&T, Verizon, Belgacom, Swisscom, Telus, and KPN, helped boost the equipment market in the second quarter, particularly IP set-top boxes, middleware, and video content security software. Another significant development this quarter was the US Court of Appeals strike-down of the FCC rule limiting cable video providers from owning more than 30% of the video subscription market. This could pave the way for Comcast to pass the 30% threshold via a merger or acquisition. In a year where growth is hard to come by and corporate valuations are low, we think there could be significant M&A activity in North America in the second half of 2009,” predicts Jeff Heynen, Infonetics Research’s directing analyst for broadband and video.

IPTV, Cable Video, And Satellite Video Market Highlights

• Worldwide telco Internet protocol television (IPTV) and cable video equipment revenue hit $1.2 billion in 2Q09, up 15% from 1Q09
• Cable operators are investing heavily in video on demand (VOD) infrastructure and hybrid IP/QAM set-top boxes to transition to a hybrid broadcast/unicast approach
  • The UK’s Virgin Media will be a trailblazer along these lines, opting to begin its transition to IPTV now, and aiming to serve roughly 13 million subscribers by 2012
• Chinese cable companies, with roughly 170 million video customers at the end of 2008, are furiously upgrading their aging broadcast video networks to support digital video and other bidirectional capabilities
• Revenue derived by service providers and cable companies for IPTV, cable video, and satellite video services is forecast to grow to $142 million in 2013 in North America
• Motorola leads in the fast growing IP set-top box market for worldwide revenue share

Report Synopsis

Infonetics’ quarterly IPTV, cable video, and satellite video report provides worldwide and regional market share, market size, analysis, and forecasts through 2013 for telco IPTV and cable video equipment. The report also tracks telco IPTV, cable video, and satellite video service provider revenue and subscribers. Equipment tracked includes IP set-top boxes, VOD and streaming content servers, video encoders, IPTV middleware and content delivery platforms, video content protection software, and edge QAMs.

Equipment manufacturers tracked: Advanced Digital Broadcast (ADB), Alcatel-Lucent, ARRIS, BitBand, Celrun, Cisco Systems, Concurrent, Dasan Networks, Edgeware, Envivio, Ericsson, Espial, Harmonic Inc., Huawei, Microsoft, Motorola, Netgem, Nokia Siemens, OptiBase, Pace plc, Sagem, SeaChange, Sumitomo, Tandberg TV, Thomson, Tilgin, UTStarcom, Yu-Xing, ZTE, and others.

Residential video and IPTV service revenue market share is provided for AT&T, Bell Canada, Cablevision, Charter, Comcast, Cox, DirecTV, Dish Network, Shaw, Time Warner Cable, and Verizon.