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IHS: Set-Top Box Shipments to Double by 2017

21 Oct, 2013 By: Erik Gruenwedel

Despite mature cable market, rise in Internet connectivity, VOD and wireless devices spurs set-top box demand

The worldwide market for Internet-connected set-top boxes (STBs) is projected to grow 91% from 2012 through 2017, driven by the growing demand of pay-TV operators rolling out wireless platforms, according to new research from IHS.

A connected set-top box is linked to an Internet protocol (IP) network. Such boxes typically integrate an Ethernet port or Wi-Fi, allowing a connection to networks located within homes. Multichannel video program distributors, such as cable, satellite and telecommunication, are distributing connected set-top boxes.

Shipments of connected boxes is forecast to reach 125.6 million units in 2017, up from 65.8 million units in 2012. Of those shipments, 45% will be connectable in 2017, up from 26% in 2012.

“STBs are playing a central role in the networking of [multimedia] products in the home,” said Daniel Simmons, senior principal STB analyst at IHS, in a statement. “Connected STBs perform all kinds of useful functions, including distributing digital video recorder streams to televisions in multiple rooms, as well as delivering video-on-demand and Web content to various platforms.”

Set-tops facilitating multimedia home networks and so-called “thin clients” for cable systems will represent a major growth driver. These devices will account for 25% of connected box shipments between 2013 and 2017.

A “thin client” is a partner device to a multimedia network that is used to interface between the IP-based video signals and a television. Thin clients do not contain broadcast tuners or hard disk drives.

This year, IPTV will account for the largest share of the connected STB market, with 39% of shipments. IHS said the coming years will see a rapid increase in shipments of cable HD boxes by Chinese operators. Because of this, cable will be the major driver of growth in connected boxes, with shipments rising at a rate of about 25.4% a year to reach 45.8 million shipments in 2017.

North America remains the largest market for connected boxes, accounting for an estimated 41% share of global shipments in 2013.

“In mature premium channel markets like North America, operators are seeing IP-based services as an opportunity to differentiate their products, and this is driving shipments,” said Wajahat Abbassi, STB analyst for IHS, in a statement.


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