Infonetics chartGlobal penetration rates for broadband services may be reaching the saturation point, but residential gateways are allowing service providers to add incremental revenues via new services such as home automation and the distribution of video to multi-screens.

“With residential gateway revenue dropping because of price declines and a saturated broadband subscriber base, operators are looking to new services to increase revenue per subscriber,” said Jeff Heynen, directing analyst for broadband access and video at Infonetics Research and author of the new report. “From our recent interviews with operators around the world, it is clear that they see their broadband access lines – be they DSL, cable or FTTH – as a conduit for new revenue-generating services, far beyond today’s voice, data and broadcast video services.

“The fastest-growing new services that operators plan to offer over residential gateways are home automation, home security and multi-screen video (wireless distribution of video to set-top boxes, PCs, tablets and mobile phones in the home), but there are many others gaining popularity, including online gaming and video telephony. Residential gateways are a better fit than basic modems for these types of services because they can be remotely managed and provisioned, have an open application layer to add and customize new features, and offer higher throughput and greater security features. In essence, residential gateways are becoming the gatekeeper for new, high-margin, revenue-generating traffic for operators.”

Other highlights from the report included:

  • The number of operators offering Wi-Fi hotspot access using a residential gateway was projected to grow to 82 percent by 2013.
  • The most critical residential gateway features are those that help operators deliver video and ensure video quality, including IGMP, TR-069 management and IPv6.
  • Service providers are reluctant to offer integrated ONTs and residential gateways.
  • In an open-ended question asking operators about the top-three residential gateway vendors, operators most often named Huawei, Pace and ZTE.