IPTV future looking good, say studies

The worldwide future of internet protocol television (IPTV) has been give a fillip by two new reports that predict success for the burgeoning broadcast format—although media and telecommunications companies have been warned that they may struggle in the short term to make major profits.

According to Global IPTV Market Analysis (2006-2010), a paper from market researcher RNCOS, internet protocol television is set to experience a manifold rise and reach a subscriber base of 63m within the next four years, with a compound annual growth rate of 65.99%.

RNCOS also claims that the overall IPTV services revenue collection from subscribers in 2010 will be more than $35bn. Video services will represent the largest share, while value-added media services and IPTV operator advertising will conjugate to donate more than 14% of revenue. Also, the content licensing revenue will reach the mark of $11bn in 2010.

Meanwhile, a study from technology industry analyst Gartner has been a little more cautious with its forecast, expecting the number of households around the world subscribing to IPTV services offered by telecom carriers to reach 48.8m in 2010.

However, the company also says that despite an eight-fold increase in users between 2006 and 2010, carriers will at first struggle to turn IPTV into a mainstream pay-TV distribution platform on par with established cable or satellite services.

The research director for Gartner's Consumer Communication Services group, Elroy Jopling said: "The difficulty in carving out a distinctive proposition that will clearly differentiate early IPTV services from other established TV options will lead many service providers around the world to drive adoption by competing on price in the next few years".

He continued: "As a result, the global picture for IPTV revenue is much less impressive than for subscriber numbers. Global IPTV revenue during the period will grow from $872m in 2006 to a still relatively modest $13.2bn by 2010. IPTV will not be a panacea to replace diminishing voice revenue for carriers, but in the medium term it can be a powerful tool for carriers in helping retain customers on their existing voice and broadband services".

Lovelace Consulting  |  08.09.2006

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