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Study: Set-top box shipments up, revenue largely flat

Thu, 04/19/2012 - 2:25pm
Mike Robuck

Last year, worldwide set-top box shipments spiked upwards by 13.7 percent compared with the previous year, but revenue was nearly flat, according to a recent study by Infonetics Research.

Last year’s set-top box revenue increased 1 percent to $13.3 billion, while global set-top box unit shipments grew faster (at more than 6 percent) than revenue (4 percent) between the third and fourth quarters of 2011.

Growth in HD and DVR set-top boxes helped keep average selling prices from declining too quickly, according to Infonetics Research. In terms of revenue share, Motorola is the top set-top box vendor globally, followed by EchoStar, Pace and Cisco, but all four were separated by a few percentage points in the fourth quarter of last year.

"Two of the most interesting trends in the video equipment and set-top box markets are: Across the board, pay-TV operators continue to increase their investments in MPEG-4 encoders to reduce bandwidth requirements for their broadcast channels and VOD streams; and despite healthy set-top box unit growth in 2011, revenue was nearly flat, reflecting the growth of lower-cost set-top boxes in emerging markets, particularly China, combined with the increased competition we’re seeing in the more mature markets," said Jeff Heynen, directing analyst for broadband access and video at Infonetics.

The study also said that IP set-top boxes and hybrid IP/DTT STB unit shipments were forecast to grow the most among the various types of set-top boxes over the next five years, increasing their share of the total market.

Also, the demand continued to accelerate for streaming devices – such as those made by Apple, Boxee, Roku, Popcorn Hour, D-Link, Netgear, Western Digital and TiVo – with global over-the-top (OTT) media server revenue jumping 38 percent and unit shipments up 68 percent in 2011 as more service providers offered streaming video to their subscribers.

Infonetics Research also released a study on the video-on-demand server and encoder market, which grew 6 percent last year to $803 million after decreases the previous two years. For this year, Infonetics predicted double-digit percent revenue increases in the global video infrastructure market.

Huawei was tops in the global VOD server market in both the fourth quarter and overall last year, while Motorola and ZTE were virtually tied for global VOD revenue in the fourth quarter.

A cumulative $1.9 billion will be spent on standard- and high-definition MPEG-4 video encoders over the next five years.

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