OTT uptake trims pay-TV revs as IPTV providers boost STB market
| 20 May 2014
Research firm Infonetics has revised downwards its predictions for the pay-TV market just as it calculates that a growing IPTV sector will spur the global set-top box (STB) industry.
Overall, the analyst calculates that the global pay-TV market — encompassing cable, satellite and IPTV players— totaled $221 billion in 2013, a 5% increase year-on-year, with a similar gain in subscriber numbers in the second half of 2013 to 756 million.
Infonetics found that the ggrowth resulted from pay-TV providers in mature markets increasing average revenue per user (ARPU) among slow-growing/declining subscriber bases, and from operators in emerging markets continuing to see significant subscriber growth. Yet it warned that long-term growth was on a downward trend as pay-TV firms finally feel the heat from the over-the-top (OTT) sector.
"As a result of increasing competition from OTT players and the service providers themselves using broadband video as a lower-priced offering, we believe overall video services ARPU and revenue growth will be constrained and, accordingly, have reduced our 2017 pay-TV revenue forecast by 35% globally, from $401 billion to just under $260 billion," cautioned Jeff Heynen, principal analyst for broadband access and pay-TV at Infonetics Research.
On a brighter note, a key driver in the subscriber growth in 2013 was a resurgent IPTV market in which, added Infonetics, providers were planning significant uptake of set-top boxes with 802.11ac in 2015. 802.11n dual-mode and 2x2 MIMO are currently the most widely-used WiFi technologies on IP set-top boxes, though 802.11ac shows the biggest gains among survey participants, growing from 6% today to 67% in 2015.