Digital TV & Set-top Boxes

As AOL and Google’s YouTube join forces in their efforts to monetize short-form video via advertising, the over-the-top (OTT) video market gets another significant boost in its journey towards developing effective business models and increasing revenue potential for its players. Ad-funded short-form content makes up the overwhelming majority of OTT video market, estimated by IMS Research, recently acquired by IHS Inc. (NYSE: IHS), at 693 billion ad-funded video streams in 2011.

There is a deep irony in the market for set-top box (STB) core semiconductors: They’re cheap enough. Most operators are choosing to add features and capabilities instead of further reducing their spend on STBs. This is reflected in all of the attendant supply markets, including set-top box core semiconductors.

Due to an FCC filing from Comcast that was made public this morning, IMS Research, recently acquired by IHS Inc. (NYSE: IHS), has learned that the small, privately held firm of Boxee appears to have almost single-handedly brought Comcast, the largest cable operator in the world, to the negotiating table over basic-tier encryption, and has apparently won everything it was looking to get.

Digital video recorder (DVR) shipment forecasts are cautiously creeping up in response to reassuring first quarter 2012 hard disk drive (HDD) production data. Last week’s quarterly update to the IMS Research (recently acquired by IHS Inc. (NYSE: IHS)) Online Set-top Box & iDTV Database forecasts a slightly more optimistic 17 percent decline in global DVR shipments between the end of 2011 and the end of 2012. IMS Research’s February forecast expected a drop of more than 20 percent.

IMS Research estimates the TV set market experienced a slight decrease in shipments during 2011 when compared to 2010, and forecasts the biggest drop in TV set unit shipments will occur in 2012. Global market research firm IMS Research (recently acquired by IHS Inc. (NYSE:IHS)) has updated its TV Set Shipments and Forecast Database with new information regarding TV set shipments split by technology, screen size, and feature in addition to TV households split by reception platform in 70 countries. Furthermore, this database includes forecasts for several key TV types, including LED-LCDs, 3DTVs and connected TVs.

Google knows that frenemies are not welcome at “Play” time.

Late last night, the New York Post reported that Google is “looking to unload the set-top box business it will inherit from Motorola Mobility even before it closes on the $12.5 billion acquisition”.

Then, this morning Google announced that it is rebranding the “Android Marketplace” as “Google Play” and is giving content, including $0.99 movie rentals, a much more prominent place in its plans.

Growth Underpinned by Shipment of 2.5 Billion IP-Enabled CE Devices in 2012, rising to 3.5 Billion in 2015

Austin, TX, 2 February 2012 – This will be the year the consumer electronics (CE) industry finally realizes the promise of multi-screen content consumption. According to a new report by IMS Research, a leading independent supplier of market research and consultancy to the global electronics industry, shipments of residential data modems and gateways will reach 135 million in 2012, and shipments of IP-enable consumer electronics devices will approach 2.5 billion, rising to 3.5 billion in 2015.

New data from IMS Research report Free-to-Air Digital Terrestrial and Satellite Retail Set-top Boxes – 2011 Edition indicates that worldwide set-top box shipments for the digital terrestrial platform will peak in 2012 with 20.5 million shipments.  Nearly 25% of these set-top boxes will be shipped into Western European nations achieving analog switch-off by the European Commission’s recommended date of 2012.

The number of new television gateways and related applications unveiled at the recent IBC exhibition confirms a new direction for the set-top box (STB) industry and digital TV as a whole. Strong demand for TV gateway and thin client arrangements and a spike in the number of gateway manufacturers confirms findings from the recently-released World Market for Digital Set-top Boxes & iDTVs – 2011 Edition and upcoming Next Generation Set-top Boxes: TV Gateways & Thin Clients reports by IMS Research.

Emerging markets will experience TV set shipment growth through 2015, which will offset a weakening TV market in developed regions. Global market research firm IMS Research has updated its Television Shipment Database and Forecast with new information regarding TV set shipments split by technology, screen size, and feature in addition to TV households split by reception platform in 70 countries. The update reveals that the TV set market in developing regions is projected to grow over the next five years, while in the rest of the world TV shipments are expected to either decline or stabilize. Furthermore, IMS Research has included forecasts for several key TV types, including LED-LCDs, 3DTVs and Connected TVs. 

50 Percent Increase in Bandwidth Usage per Household Globally Through 2015 Threatens Bandwidth Shortage

Austin, TX, 18 July 2011 — New findings from IMS Research's Global Bandwidth Utilization Model reveal that the telcos who are IPTV providers face substantial challenges adapting their networks to accommodate the onslaught of over-the-top (OTT) video. IMS Research estimates that in 2010 peak bandwidth utilization was 44 percent of capacity, and that the bandwidth usage per household is forecast to increase by more than 50 percent between 2010 and 2015.

With diverse interest in the OTT market from major CE suppliers, pay-TV operators, leading Internet portal companies, DVD rental companies, and large CE retailers, there is a plethora of business models being implemented to find an ideal monetization method for OTT. IMS Research forecasts that pay OTT subscription services will generate a cumulative $32 billion in revenues over the next five years, accounting for the majority of the market each year when compared to pay-per services that enable users to rent or purchase videos on an ad-hoc basis. 

Video-on-demand (VOD) services are gaining significant traction in markets such as North America and Europe, where large pay-TV operators have formed content portfolios consisting of thousands of movies and TV shows. IMS Research estimates that in 2010, the North American VOD market generated $1.98 billion in revenues, and the European VOD market totaled $1.11 billion. The two regions combined comprise 46.1 million pay-TV subscriber homes that are using VOD services.