ABI: Set-Top Box Manufacturers Respond to Increasing Risks
December 29, 2007 // Published as a news service by IHS
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The status of the set-top box (STB) within pay-TV households faces significant risk from the development of two-way, digital cable-ready TVs, media centers and residential gateways, according to ABI Research.
As a result, STB manufacturers are responding by adding new features and functions to their product.
"In recent times, Comcast created a residential network gateway project, which ultimately will act as a convergence device for cable modems, digital cable receivers and DVRs [digital video recorders]," said ABI Research analyst Paulhwa Lee.
"The residential network gateway device may even include placeshifting."
STB manufacturers are adding new features, such as increased hard disk space, DVD players, DVD burners and home audio solutions, which will better align STB functionality with consumer demands.
Analysts said manufacturers also are attempting to improve electronic program guides and to incorporate more video gaming and web-based services.
"STB vendors are moving aggressively into the hybrid STB market," said Lee. "Hybrid STBs offer a single solution to numerous possible problems caused by the multiplicity of video sources, video formats and distribution platforms."
According to ABI Research, revenue from standard STB sales will decline in the period from 2008 to 2012. STB vendors initially will rely on growing markets for digital broadcast satellite (DBS), Internet protocol television (IPTV) and digital terrestrial television (DTT) STBs.
By 2010, however, analysts said even those sectors will be under pressure from alternative technologies introduced to facilitate "the connected home." Vendors must include new features and functions to revive flagging shipment numbers.
"No one video or television technology will be a 'killer' in the next few years, so as this market flattens in 2012, STB vendors should incorporate as many of those technologies as possible," Lee said.
Source: ABI Research.