IPTV and DTT - The rise of Free-to-air and Customized TV Experiences

Tuesday, October 13th, 2009 
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The IMS Research study ‘IPTV: A Global Market Analysis’ reveals that nearly 13% of total worldwide IP set-top box (STB) shipments in 2008 were operator deployed IP+DTT STBs. Of the 1.6 million IP+DTT STBs deployed, 87% of shipments went to Western European TV households.

Rebecca Kurlak, research analyst and author of the study, states, “Uptake of operator deployed IP+DTT STBs has been popular in both the UK and France, but it is anticipated that Italy, Germany, Spain and the Netherlands will also see an increase through 2014. As a global projection, IMS Research expects 25% of IP shipments to be IP+DTT STBs. In Eastern Europe, Poland and the Czech Republic will comprise 54% of Eastern Europe’s IP+DTT shipments in 2014.”

Kurlak continues, “Not only will IP+DTT STBs experience a surge from operators, but in the retail market as well. Fetch TV and Video Futur are just two examples of operator-free TV service business models available to Western Europe households. The boxes supply a la carte VOD offerings in tandem with free-to-air (FTA) DTT channels. The STBs are as compelling as traditional pay-TV operator STBs by offering DVR functionality, VOD and digital multichannel TV capabilities. The only drawback is the fact that sports programming and popular specialty channels remain absent from the content offerings.”

Additionally she notes, “For those that are not avid sports fans and prefer to pay for only a select amount of content, the retail STB does prove to be an attractive offering.”

Tier 1 Telcos Stealing the IPTV Honey from the Telco 3 Bee Hive

The IMS Research study ‘IPTV: A Global Market Analysis’ also reveals that IPTV deployments globally are largely attributed to tier 1 telcos. By the end of 2014, IMS Research forecasts 40.1 million TV households will be subscribers of tier 1 telco IPTV services.

Rebecca Kurlak, research analyst and author of the study, states, “Tier 1 telcos have the advantages of both scalability and the imminent opportunity for solid ROI that has placed forerunners like AT&T and France Telecom in a very compelling position in the pay-TV environment.”

Kurlak continues, “Not only will AT&T and France Telecom continue to see uptake in their acquisition of subscribers, but China Telecom, BBTV, NTT, FREE, Neuf Cegetel, Telefonica’s Imagenio and BT will also see extraordinary uptake of their IPTV services.”

In regards to smaller telcos she notes, “Tier 2 and 3 telcos will continue to experience subscriber growth as well. In 2008, tier 2 and tier 3 telcos comprised almost 46% of subscribers. Throughout the forecast, the larger telcos will essentially be stealing honey from the smaller telcos’ bee hives by providing more services, deeper discounts and more compelling content from major studios. Hence the reason why the small telcos will only garner close to 23 million TV households by the end of 2014, half the potential of what Tier 1 telcos are anticipated to achieve.”

In addition to television household forecasts (split by picture quality and DVR functionality), the study provides detailed analysis of IP and IP+DTT STB shipments and revenues for three major global regions and three sub-regions, with further analysis on 64 individual countries. Two new features of the report include forecasts for IPTV Households by Telco Tier and segmentation of IP STB Shipments by MPEG-2 vs. MPEG-4 AVC compressions. IMS Research is the first to incorporate these segmentations in their reporting.