The transition to digital television and increasing
competition between operators will help push worldwide set-top box shipments to
200 million by 2013, according to a new report from Parks Associates.
As operators rapidly more boxes for high-definition TV, DVR
and interactive services, set-top box shipments will see a 36% cumulative
average annual growth rate, according to Parks.
The Set-Top Boxes:
does not provides a breakdown between standard-definition and HD set-tops, but
Parks Associates research analyst Jayant S. Dasari notes that most of the newer
boxes being shipped in North America are MPEG-4 or HVC.264 boxes that allow
operators to more efficiently handle the higher-bandwidth requirements of HD
A major driver for new set-top box shipments is the move to
expand digital offerings. "Comcast, Time Warner Cable and all the leading MSOs
have set aside considerable amount of their cap ex [capital expenditures] for
2008 and 2009 to provide digital to analog converts," Dasari said.
That push to reclaim analog bandwidth will also help the
operators add more high def content.
"The second big trend we see is the growth in HD and the support
for HD content," he noted. "The satellite providers have been leading in that aspect
in the sheer number of channels ... but we are seeing similar trends in telcos
and cable as well. The operators obviously see an opportunity to get higher
ARPUs when subscribers start to move to higher tier services, which include
In North America, Dasari estimates
that "the bulk of the set-top boxes [being deployed by operators] today would
be HD capable" and that operators are rapidly deploying MPEG-4 capable boxes to
handle more HD content.
"The chips and MPEG-4 codecs now seem to be at a price point
where they are quite affordable," he explained. "In North America, my
understanding is that over 80% if not close to 90% of the boxes that were
shipped in late 2008 and [so far this year] have been MPEG-4 capable."
Global set-top box shipments also show a growing demand for
DVR-enabled devices, boxes capable of handing Tru2way or interactive services
and set-top boxes that could be connected to the Internet, Dasari said.
Dasari believes that most U.S.
major operators will have upgraded their head-ends to be Tru2way capable by
2012 and 2013 but the major shipments of Tru2way boxes to their customers
"won't really gain steam until towards the end of this year and 2010."
Another major trend will be set-top boxes that can be
connected to consumer-electronic devices or a broadband connection, which would
allow subscribers to access the growing amount of HD content on the internet.
A separate Parks survey found that about one-third of U.S.
broadband households are currently "very interested" in a set-top box that is
connected to the internet, though less than 10% were willing to pay a monthly
fee for the service.
Dasari expects that in North America
"virtually 100% of set-top boxes" shipping in 2013 will be connected
Parks' estimate of annual set-top box shipments
includes only boxes that are sent from operators to their customers. These
estimates exclude digital-to-analog converters, as well as standalone digital
video recorders, such as TiVo boxes sold at retail. As a result, its estimate is
lower than some other set-top box shipment forecasts.