Taiwan Terrestrial STB Shipment to Decline, Says MIC

Thursday, March 11th, 2010
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According to research of the Taipei-based Market Intelligence & Consulting Institute (MIC – previously known as the Market Intelligence Center) conducted as part of the ITIS project, as many regional markets around the world are due to complete the digital switchover, demand for digital terrestrial STBs is expected to gradually decrease in the future. In addition, with digital terrestrial STBs having relatively low profit margins, some Taiwanese manufacturers have begun shifting their focus to satellite STBs and some have even decided to withdraw from the digital terrestrial STB market altogether. Consequently, the Taiwanese digital terrestrial STB industry’s shipment volume is expected to decline in the future, and is anticipated to reach approximately 3.23 million units in the full-year 2010, representing a 4.1% annual decline.

Taiwanese Digital Terrestrial STB Industry Shipment Volume, 1Q 2008 – 4Q 2009 (Unit: Thousand)

                    1Q08     2Q08     3Q08     4Q08     1Q09     2Q09     3Q09     4Q09
                 -------  -------  -------  -------  -------  -------  -------  -------
Shipment Volume    769.8    535.9    969.5    987.8    635.8    997.9  1,161.1    576.8
QoQ Growth          2.1%   -30.4%    80.9%     1.9%   -35.6%    57.0%    16.4%   -50.3%
YoY Growth         80.3%    37.4%    43.1%    31.1%   -17.4%    86.2%    19.8%   -41.6%

Source: MIC, February 2010

Due to the US government’s aggressive promotion of its digital switchover policy, the Taiwanese digital terrestrial STB industry’s shipment volume saw growth in 2008. However, as many US TV stations shut down their analog broadcasting signals on June 12, 2009, the Taiwanese industry’s ATSC model shipments in the second half of 2009 were significantly reduced. Instead, the industry’s shipments for digital terrestrial STBs based on the European DVB-T standard began to rise. The Taiwanese digital terrestrial STB industry’s shipment volume reached approximately 3.37 million units in the full-year 2009, up 3.4% compared to 2008. Of the industry’s total terrestrial STB shipments in 2009, shipment volume of ATSC models stood at 650,000 units, accounting for 19.4% of the total, while shipment volume of DVB-T STB models arrived at 2.72 million units, accounting for 80.6%.

As regards product specifications, Mexico also uses the ASTC standard and has become another major shipment destination for Taiwanese makers. Among Taiwanese makers’ shipments for Latin America, the share of CA and HD STB models is increasing, leading to an ASP (Average Selling Price) increase for ATSC STB models. As for DVB-T STB shipments, as Western European digital TV operators are promoting HD pay-TV channels, the shipment share of HD and DVR STB models is therefore growing.

Aside from ATSC STBs and DVB-T STBs, Japan’s ISDB-T STB models have become a new focus area. Japan is due to complete the digital switchover in 2011, while Brazil, which also uses ISDB-T STB models, plans to complete the digital switchover process in 2016. Taiwanese digital terrestrial STB makers began small-scale shipments for ISDB-T STBs in 2009, and it is anticipated that ISDB-T STB shipments will increase in the future.

More information can be found in the following MIC report: The Taiwanese Digital Terrestrial STB Industry, 1Q 2010