Growth of Digital TV Boosts Demand for Conditional Access Technologies

SCOTTSDALE, Ariz. — The strong worldwide growth of digital TV services is driving demand for conditional access (CA) products and technologies, reports In-Stat. At the end of 2006, there were over 175 million households watching digital TV services, the high-tech market research firm says. While the growth of digital TV households is certainly good news for pay-TV service providers, it also poses an important challenge: How to protect their valuable video content from piracy or illegal usage.

“The common industry solution to this challenge is through the use of conditional access technologies,” says Mike Paxton, In-Stat analyst. “CA technologies can protect video content by specifying that certain criteria be met before a viewer is granted access to that content.”

Recent research by In-Stat found the following:

• CA product revenues have been increasing steadily and were projected to reach $937 million at year-end 2006.
• NDS Group plc, a subsidiary of News Corporation, is the world’s leading CA vendor. NDS currently has 35% of the total worldwide CA market.
• The emerging Telco TV / IPTV market segment is becoming a key proving ground for a number of recent CA technology start-ups companies.
• Worldwide pay-TV industry CA revenues are forecasted to reach $1.5 billion in 2010.

Recent In-Stat research, In-Depth Analysis: Conditional Access in Pay-TV Markets (#IN0603167MBI), covers conditional access products and technologies in the pay-TV services industry. It discusses why there is a need for conditional access in the pay-TV industry, how it works, and highlights the basic business models in use today. The research also profiles leading CA product vendors, provides current vendor market shares, and discusses key market trends that will shape the CA market in 2007. In addition, it forecasts worldwide revenues for pay-TV CA products through 2010.