The research firm said that the pay TV market would continue to grow to 2016, even though the overall set-top box market is tipped to peak this year due to the state of the free-to-air market.
“Despite the overall STB market topping out this year, this is entirely due to erosion of the free-to-air segment. We’re going to see the trinity of cable, pay satellite and IPTV continue to perform, growing by 2% CAGR between 2012 and 2016,” says Carl Hibbert, head of entertainment content and delivery at Futuresource.
“The majority of this growth is coming from Asia Pacific and Latin America, as the regions expand their cable digitalisation programmes and new services continue to appear. Conversely, demand for Pay TV STBs in developed markets is now predominantly saturated, though the transition to higher priced advanced media gateways in these regions will have a sustained and positive impact on revenues,” he added.
Futuresource said that STB vendors are trying to ward off price erosion by differentiating their products with features like increased storage capacity, multiple tuners and integrated IP services and content.
Advanced multimedia home gateways that allow viewers to share content between multiple screens in the home will reach shipments of nearly 3.5 million units this year, with the majority of demand coming from markets such as North America and Western Europe, said Futuresource.
“Multimedia home gateways are increasingly a new weapon of choice for operators to stem subscriber churn, offering subscribers new services and more efficient delivery of video to secondary screens in the home and on the move. Although they are costly for operators – at roughly double the price of preceding premium set-tops – they can be extremely cost effective for operators in the long run, particularly in homes with high levels of multiple TV ownership,” said Hibbert.