The global market for connectable STBs is expected to surge by 91% from 2012 through 2017, driven by a number of factors including the adoption of multimedia home gateways (MHGs).
Worldwide shipments of connectable STBs are forecast to rise to 125.6 million units in 2017, up from 65.8 million in 2012, according to the latest Set-Top Box Market Monitor report from IHS. A total of 45% of all STBs shipped in 2017 will be connectable, up from 26% in 2012. The figure below presents the IHS global forecast of connectable STBs.
A connectable STB is a set-top box that can be 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. All types of pay-TV operators—i.e., cable, satellite and IPTV providers—are distributing connectable STBs.
“Consumers increasingly are demanding connectivity from their electronics devices, and STBs are playing a central role in the networking of products,” said Daniel Simmons, senior principal STB analyst at IHS. “Connected STBs perform all kinds of useful functions, including distributing digital video recorder (DVR) streams to televisions in multiple rooms, as well as delivering video on demand (VoD) and web content to various platforms. Furthermore, MHGs and their associated thin clients, which also employ connectivity, are being used by pay-TV operators to provide advanced services and content to all kinds of IP-connectable devices, including mobile products like smartphones and media tablets.”
MHGs and thin clients for cable systems will represent a major growth driver for connectable STBs. These devices will account for 25% of connectable box shipments between 2013 and 2017.
An MHG is a converged STB/residential gateway device that directly processes video signals for all IP distribution and routing to multiple client devices within a home. A thin client is a partner device to an MHG that is used to interface between the IP-based, in-home video signals and a television. Thin clients do not contain broadcast tuners or hard disk drives.
In 2013, IPTV pay-TV operators will account for the largest share of the connectable STB market, with 39% of shipments. However, the coming years will see a rapid increase in shipments of cable HD STBs by Chinese operators and MHG migration throughout the rest of the world. Because of this, cable will be the major driver of growth in connectable STB, with shipments rising at a rate of about 25.4%t a year to reach 45.8 million shipments in 2017.
North America is at present the largest market for connectable pay-TV STBs, accounting for an estimated 41% share of global shipments in 2013. The region is expected to retain its global lead through 2017.
“In mature pay-TV 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.
However, Asia-Pacific is expected to experience the fastest growth during the period from 2012 to 2017, with shipments expanding at a compound annual growth rate (CAGR) of 17.2%.