IPTV middleware spending spree expected

Tuesday, June 24th, 2008
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CAMPBELL, California — Communications market research firm Infonetics Research reported today that the combined Internet protocol television (IPTV) and switched digital video (SDV) equipment market increased 12% sequentially to $1.3 billion worldwide in 1Q08.

Infonetics’ report, IPTV and Switched Digital Video Equipment, Services, and Subscribers, indicates revenue growth is being driven by growing numbers of service providers rolling out new IPTV networks or expanding existing networks to support more subscribers. The market is also getting a push from cable MSOs introducing switched video capabilities into their digital TV networks to free up bandwidth and offer more high definition (HD) content to their subscribers.

“While most of the segments we track in the IPTV market are seeing consistent quarterly growth, IPTV middleware is going to be an especially interesting segment to watch. We’re expecting an IPTV middleware spending spree over the next few quarters because a lot of the early IPTV service providers are running into scaling issues with their off-the-shelf middleware. Those providers are going to have to replace their IPTV middleware with a more robust solution to replace or augment their first-generation deployments. Middleware issues are one of the main root causes of IPTV rollout delays, so early hiccups have to be addressed quickly,” said Jeff Heynen, directing analyst for IPTV at Infonetics Research.

Other report highlights:

  • The number of IPTV subscribers is forecast to hit 93 million worldwide by 2011
  • Worldwide IP set-top box revenue grew 10% in 1Q08 over 4Q07
  • Motorola continues to lead the worldwide IP set-top box (STB) market in 1Q08, although its closest competitors made major inroads this quarter, reducing Motorola’s lead
  • ADB takes the lead in 1Q08 in worldwide hybrid IP/over-the-air STB market share
  • Cablevision was the first to roll out switched digital video; it will soon be followed by other MSOs in North America, then those in Europe/Middle East/Africa (EMEA) and Asia Pacific (APAC), who face an uphill battle for triple play subscribers
  • France remains the hotbed of IPTV activity, with Orange, Free, and neuf all battling for IPTV subscribers
  • Telco IPTV operators in Western Europe, particularly France, Sweden, and Italy, continue to give away their IPTV service to hold on to their broadband subscribers

Infonetics’ report provides market size, market share, and forecasts for IPTV equipment, including integrated digital headend platforms, video on demand (VOD) and streaming content servers, IP video encoders, universal edge QAMs, IPTV middleware and content delivery platforms, and IP STBs. The report also tracks IPTV, cable IPTV and cable SDV service revenue and subscribers.

Companies tracked include Advanced Digital Broadcast (ADB), Alcatel-Lucent, Amino, ARRIS, Celrun, Cisco Systems, Dasan Networks, Ericsson, Huawei, Microsoft, Motorola, Netgem, Nokia Siemens, OptiBase, Pace plc, Phillips, Sagem, Samsung, Scientific Atlanta, Sumitomo, Tatung, Telsey, Thomson, Tilgin, UTStarcom, Yuxing, and others.