 |
Consumers set to switch on to IPTV by end of the decade
- 40 million IPTV households expected worldwide by 2010
Reading, UK - Wednesday, 31 October 2007
For immediate release
- Canalys forecasts there will be 39.6 million IPTV
subscribers worldwide by the end of 2010
- EMEA will remain the largest region for IPTV, although its
dominance will be reduced
- Rapid growth in North America is expected – 12.1 million
subscribers by the end of 2010
- The huge potential in the Asia Pacific region will be
restricted by regulatory issues
- Infrastructure investment is needed to boost developing
markets
New forecasts from leading analyst firm Canalys indicate the IPTV
market will see rapid growth over the next three years, driven by
telecom operators’ desire to boost ARPU (average revenue per user)
and counter the growing threat from competing triple-play providers.
Worldwide IPTV subscriber levels will increase more than tenfold by
the end of the decade, growing from fewer than 4 million in 2006 to
almost 40 million in 2010.
EMEA accounted for two-thirds of global IPTV subscribers at the
end of 2006, and will remain the largest market through to 2010,
when the region will account for 38% of the worldwide total. “France
is the European IPTV trailblazer, boasting 1.3 million subscribers
at the end of 2006,” said Canalys vice president Alessandra
Fitzpatrick. “Good, early uptake has been driven by a number of
factors, notably low broadband prices, the prevalence of bundling
low-cost IPTV service with broadband/telephony packages and limited
competition from cable operators.”
But the favourable market conditions that have helped IPTV thrive
in France are not evident in all markets. In most, high levels of
competition from existing services will make it difficult for IPTV
providers to compete unless they can differentiate their services,
either by providing better quality of service or by maintaining
lower subscription fees. “IPTV providers will have to compete on
price in the short term. As a result, deploying TV services may not
prove to be a significant revenue generation opportunity, although
establishing a position in this emerging sector will be crucial for
service providers seeking to protect their positions as prime
providers of communication services,” Fitzpatrick added.
With Verizon growing rapidly and AT&T moving beyond the
infrastructure development phase, Canalys expects to see strong IPTV
subscriber growth in North America. Being home to just 9% of the
worldwide subscriber base at the end of 2006, the region will rise
to represent 31% of all subscribers by 2010. “The Asia Pacific
region also offers huge potential, but the regulatory environment is
restricting development,” Fitzpatrick commented. “The IPTV markets
in China, Japan and South Korea are heavily constrained at present,
although the 2008 Beijing Olympics may prompt Chinese authorities to
accelerate plans.”
Canalys forecasts more than 11 million subscribers across the
Asia Pacific region by the end of the decade, although this figure
could easily be surpassed should regulatory obstacles be overcome.
In less developed regions, IPTV services will be restricted to a
large degree by shortcomings in deployed infrastructure and low
levels of disposable income. While network investment is high,
especially in Latin America and Central and Eastern Europe, much of
this investment will not bear fruit within the forecast period.
There is potential for strong uptake beyond 2010, but this will be
dependent on factors such as pricing, regulation and content
availability.
“IPTV can be viewed primarily as a defensive strategic move by
service providers at present. While telcos have aspirations of
creating new, profitable revenue streams, the key short-term driver
of market development is improving customer loyalty and reducing
churn levels,” Fitzpatrick continued. “IPTV will be a financial loss
leader for many providers over the next five years when the costs
involved with rolling out and evolving services are factored in, but
if telecom operators are to retain their position as primary
providers of consumer communication services, this may be a price
they need to pay. It is difficult to see how the majority of IPTV
providers will be able to generate significant profit from services
in the near term, especially when the need to be price competitive
is considered.”
IPTV has already become a significant fourth platform for digital
TV in many markets, and its importance across the broadcast sector
will increase over the next three years. In Western Europe, for
example, Canalys expects IPTV to account for 11% of digital TV
households by the end of the decade, up from just 3% at the end of
2006. In EMEA and North America, established cable and satellite
operators will offer stern competition. Convincing existing pay-TV
subscribers to switch provider will not be easy, with most existing
IPTV services offering little beyond what is already provided by
cable and satellite. Greater differentiation will be needed if IPTV
is to take a greater share of the digital TV market. Having
compelling content will be crucial, and this means building
exclusive partnerships with content providers and aggregators. To
fully exploit the potential of IPTV, service providers will quickly
have to develop and introduce advanced services that set their
offerings apart from those already available. This means significant
investment in intelligent network infrastructure is needed. A window
of opportunity exists for IPTV service providers, but in the
fast-moving broadcast market, the window will not be open for long.
Note: Canalys defines IPTV as a digital TV service delivering
broadcast-quality digital TV and interactive services over xDSL,
FTTH or cable networks using IP via a set-top box to the main TV in
the home; this includes hybrid IPTV solutions, such as those offered
by BT in the UK, but excludes web TV services delivered to a PC.
About the IPTV Analysis Worldwide service
The market estimates and forecasts in this release come from the
Canalys IPTV Analysis Worldwide continuous advisory service. Through
regular reports, database releases and direct analyst contact,
Canalys sizes the IPTV market and examines and advises on the issues
facing service providers, hardware vendors, software, content and
services companies active in the IPTV sector. It looks at the key
market trends globally, service provider business models,
opportunities for hardware and software vendors, and end-user
behaviour. More
information...
Analyst photos
Photographs of the analyst(s) quoted in this
release are available in the biography
section and may be re-used by the press to accompany a relevant
article.
About Canalys
Canalys specialises in delivering high quality market data,
analysis and advice to the world’s leading technology vendors. It is
recognised as a key provider of continuous advisory services and
confidential custom projects for marketing managers and strategists
within blue-chip IT, telecoms, navigation and consumer electronics
companies. It has unrivalled expertise in European routes to market
for all kinds of high technology products and services in the
consumer, SMB and large enterprise segments, and provides worldwide
market data and trends analysis.
Receiving updates
To receive future Canalys research releases
directly, please e-mail a request with your details to press@canalys.com
or complete this form
specifying the technology market topics in which you are most
interested.
|
|
