27Apr/160

Connected TV: Accelerating OTT video development

BAJON_Jacques

Jacques Bajon
Director of Media & Digital Content Business Unit, IDATE DigiWorld

The development of connected TV is inextricably bound up with the widespread availability of high-speed Internet access, a shift to more and more individual viewing and the proliferation of smart devices in the home.

 

Together, these three elements are steadily revolutionising how viewers access their TV programmes, and providing them with an array of new functions and features. TV sets can be connected to the Internet in several ways. Using:
a smart or connected TV (direct connection, via Ethernet or Wi-Fi),
a connected set-top box,
a streaming box or stick,a connected game console,
or a smart Blu-ray player.

In 2015, almost three-quarters of the televisions being shipped are Smart TVs, even if their owners may not systematically take advantage of the Internet connection. At the same time, the market for streaming devices – whose main purpose is to play online videos – is progressing rapidly. Within this market that is still populated by a great many solutions and services, several trends are taking shape:
the way users access and employ connected TV services has become more simple, and shifted from Internet-centric to video-centric;
managing connectivity with users’ personal devices has become a key issue, with app systems playing an increasingly central role;
OTT services are moving to the TV and making real strides;
...

More information about main trends

Technological progress in a variety of areas is helping to bolster the market’s development, be it the growing ubiquity of broadband and superfast broadband access in the consumer market, major improvements in video optimisation and compression (HEVC), or the advent of innovative features such as casting which allows users to send video content from a personal device to the television. The main stakeholders in the connected TV ecosystem can be broken down into three categories, based on their original sector of activity: consumer electronics (CE) companies, TV market players and the Internet’s leaders.
CE industry players are working to improve their software interfaces, either through dedicated developments such as Samsung has done with Tizen, or by acquiring another company, as LG has done with WebOS. The aim is to capture the added-value in the marketplace, whether in the arena of services and/or by selling high-end devices.
Players from the TV universe are developing their OTT products, and working to bolster their position on the software side of the equation with more open and hybrid platforms. The connected TV could enable them to renew ties with consumers, and better monetise their plans. Broadcasters and pay-TV providers, especially in the United States, are therefore starting to roll out complete OTT plans which include a live component
Lastly, companies such as Google, Amazon, Facebook and Microsoft that dominate the Internet, are very knowledgeable about software, and changing consumer habits. So they are in the best position to deliver a top-notch user experience, whether in terms of smooth and intuitive interfaces, or providing recommendations based on user data. Their increasingly vertical positioning – covering everything from the content to the device – is also bolstering their potential to capture a growing portion of the video entertainment market.

In this way, many scenarios are emerging for Connected TV to 2025, and will determine which industries are likely to increase their control over this environment:

Impact_scenarios_TV_connectee_2025_IDATE_DigiWorld_OTT_VA

The size of the OTT video market will vary considerably under these scenarios, depending on how the environment evolves and so which industries prevail, and The popularity of the different devices will also evolve along the same lines.

Discover the perspectives,  key trends, and scenarios about the TV market for the next decade through our dedicated report and register to DigiWorld Future 2016 

DWF15 video report v3For the publication of the 16th edition of the DigiWorld Yearbook (pre-order now), IDATE is organizing a conference based on the detailed analysis of the current situations and some forecasts by IDATE experts on the major digital sectors, the discussion will deal with the great trends and challenges that will disrupt the digital markets by 2025.

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6Aug/13Off

Next Gen TV: OTT and on-demand services

Gilles Fontaine

Gilles FONTAINE

Deputy Managing Director
Director of the Business Unit TV & Digital Content Business Unit, IDATE

The video distribution chain is evolving. Traditional programming models have been turned on their head (shortened release windows; Netflix releasing all episodes of a series all at once); video consumption on tablets is growing, before connected TVs really take off; and linear TV is relying on social networking faced with the growing strength of Internet platforms with a native specialisation in personalised recommendations.

Evolution in action

The various categories of player are seeing their historical models under threat. Cable and IPTV network operators have had to review their content distribution strategies. Some (Comcast) are strengthening their offerings to compete with OTT services, while others (Telecom Italia) are offering as a minimum a combination of linear television and on-demand services without quality of services guarantees. Television channels, whose core business is aggregation, want to keep their added value in a climate of growing on-demand. On the one hand, the major free channels are looking to promote live events to maintain the link with their mass audience; on the other hand, pay-TV services are introducing VOD to increase their attractiveness and are also investing in exclusive rights.

VOD service revenue worldwide

Fragmentation before convergence?

The growing number of offerings and players coming onto the video market is leading to fragmentation. New players, from the Web and also consumer electronics manufacturers, are coming out with new free or paid services that fi ll market segments ripe for exploitation, such as subscription-based VOD services, which compete with pay-TV, and ad-supported premium programming, which competes with the catch-up TV services of free channels.
The lines between linear services and on-demand services are likely to blur with the advent of mixed services that combine linear (or relinearised) television and directly competing on-demand programming. Fragmentation is also occurring due to the proliferation of proprietary ecosystems that are breaking away from the traditional ‘standardisation’ of television distribution and reception. In an effort to both promote their proprietary devices and to exploit customer loyalty, TV manufacturers and developers of mobile phone, tablet and connected TV operating systems are seeking to create their own ecosystems.
However, this fragmentation should be reversed in the medium term as a few distribution platforms start to dominate, offering the major content services and differentiating themselves by the quality of experience delivered to their customers. We should see the situation return to something like the traditional television model, where the various distributors are generally offering the same services, but packaged differently.

We can therefore identify three opposing visions for the long-term evolution of video content distribution:

  • The traditional model of packaging access and content together: Using an intelligent network equipped with a smart box, telcos and cablecos distribute packages that they have negotiated with content service providers or directly with the producers.
  • The self-supply model: Strong-brand content services use the open Internet to reinforce or re-establish a direct link with consumers.
  • The digital store model: E-commerce sites offer all content and make it available to consumers through recommendation and personalisation engines.

Long-term growth outlook for on demand television services

What impact will we see on the market?

While digitisation will bring more growth to certain developed markets, the next decade will show a marked decline in linear television revenue in the video sector, and a corresponding increase in new on-demand services. For the incumbent audiovisual operators, their capacity to generate revenue from these new services will dictate whether they can sustain their levels of turnover. They will, for all that, only find growth opportunities in emerging markets.

TV: the top on-demand service market in 2022

About the Digiworld Yearbook

While digitisation will bring more growth to certain developed markets, the next decade will show a marked decline in linear television revenue in the video sector, and a corresponding increase in new on-demand services. For the incumbent audiovisual operators, their capacity to generate revenue from these new services will dictate whether they can sustain their levels of turnover. They will, for all that, only find growth opportunities in emerging markets.

digiworld yearbook 2013
197 pages that deliver the finest market insights from IDATE experts who track the changes at work in the globe’s telecom, Internet and media industries throughout the year.

the DigiWorld Yearbook is published in English and French and available in print and PDF format. An iPad edition, developed by Forecomm, is also available.

The 2012 edition can be downloaded for free
The 2013 edition is available for purchase. Print: €99.99, incl. VAT; PDF and iPad: €54.99, incl. VAT

 

  • You can have a look at the digiworld yearbook 2013, purchase it or even download the 2012 version for free at : www.digiworld.org/yearbook/
19Jul/13Off

Connected TV: Key partnerships

Jacques BajonJacques Bajon

Head of "Video Distribution" Practice

Towards consolidation of the fragmented connected TV platform market

Securing partnerships:
content – device, device – broadcaster, software platform – device.

Inside television’s new environment, veteran TV players and new entrants alike are working to secure a slew of cooperation agreements: content – device, device – broadcaster, software platform – device. The momentum created by partnerships initiated by content providers is picking up, devices are an increasingly integrated part of service plans, and we expect to start seeing a consolidation of today’s fragmented connected TV platform market.

Content meets devices: OTT gathering steam

Although we have seen a string of agreements between TV broadcasters and device suppliers over the past several months, it is OTT video providers that are the most likely to move viewers beyond the confines of watching videos on a computer, by taking their solutions to the TV set and, more widely, to all of the screens in the home. We are nonetheless seeing regional differences emerge, along with some examples that could be worth emulating. In Asia, for instance, TV broadcasters are managing to join forces on aggregated OTT platforms: in South Korea with Pooq TV and in Japan with Motto TV. On a smaller scale, this type of partnership also exists in the United States with Hulu (Plus) and in the UK with the BBC’s iPlayer.

Also worth mentioning is the presence of two of the leading viral video sites, Dailymotion and YouTube, on smart (i.e. connected) devices the world over.
American giants continue to make inroads into international markets – and especially Netflix which operates in 40 countries, including North America, Europe (the UK, Ireland, Scandinavia) and Latin America – while newcomer HBO Nordics has set up shop in Norway, Denmark, Finland and Sweden.
Meanwhile Amazon, which operates in North America under its own brand, and in Germany and the UK through its more than 2 million LOVEFILM subscribers, recently pulled out of the Scandinavian market.

A selection of smart TV alliances and standardization initiatives

Smart TV alliances

Source: IDATE, July 2013

Devices an increasingly integral part of pay-TV providers’ service line-up

We are entering a new era of smart TV – also referred to as connected TV – one where devices are an increasingly integral part of pay-TV providers’ solutions.
The first partnerships that allow users to do away with a set-top box have come on the market. These are helping boost the concept of the “Operator as an App” that emerged with smart TV hardware for secondary TV sets in the home. Pay-TV providers are moving their distribution to the cloud to deliver more flexible solutions in an increasingly multi-screen environment.
Meanwhile, hybrid devices are allowing specialists from the world of broadcast TV to enhance their offering with complementary OTT services, and so acting to some degree as the return path that broadcasting networks lack.

Is it merger & acquisition time for smart TV platforms?

The battle for control of the user interface will only accelerate. Device makers, pay-TV providers and the top software companies will move increasingly into some form of coopetition.
Straight-up competition between proprietary platforms will be the norm at first, but players will move gradually towards a more cooperative approach, and no doubt a series of agreements as mergers begin to occur.
The top software companies, which are more apt to focus their R&D efforts on their core business and able to leverage their app stores, are also expected to make real inroads into this market. Though still rather marginal players, the Android TV, iOS TV and Microsoft Windows TV systems could become central components in the future ecosystem.

This is an excerpt of our insight Connected TV: key partnerships being a part of our ongoing monitoring service Connected TV distribution Watch

11Feb/13Off

Cord Cutting


Jacques Bajon

Head of "Video Distribution" Practice

Cordcutting: Is Europe ready?

 

Cord-cutting, which describes the phenomenon of traditional television services' customer drain, is at the heart of the new competence in the audiovisual landscape. IDATE recently published an in-depth market report dealing with this topic and it proposes a complete benchmark of new video offers in the United States and analyses the best practices. The study provides also conclusions on potential impacts of this phenomenon in Europe.

The phenomenon of cord-cutting can be regarded in a broader perspective of evolution in access to television and video services. This threat to the established MVPDs1 is in fact symptomatic of a broader set of upheavals in the television industry. Various factors contribute to these changes: the economic crisis, which fuels tensions surrounding the primary income of the established players (advertising and subscription); an underlying trend of on-demand video consumption and changing usage habits that threaten to shatter lucrative TV packaging schemes; the entry of Internet players who master these new usage habits and are a step ahead when it comes to user interfaces, a key element in the future.

The traditional television players – channels and distributors – are thus facing a scissor effect. TV channels are seeking alternative growth models that include enhanced B2B with distributors and entry into the online market to serve as a springboard for advertising growth. For their part, distributors are seeing Internet players encroach onto their networks, while rights holders and TV channels continually weigh the benefits of partnering with them. The instability is constant. For Jacques Bajon, report’s project manager: “The key issue at stake is this process of disintermediation, and the TV industry's inability to team up only reinforces the trend.”

In the United States, players' strategies are thus primarily defensive:

Rights holders and TV channels still hesitate between choosing traditional distributors and the new ones (i.e. Internet-based);

Distributors are attempting to retain their subscribers with multi-screen offerings and by focusing on the Internet access growth engine (itself a vehicle for disintermediation!) and – in a new trend – by working together.

Quarterly changes in video subscribers (net additions) of US MVPDs, Q1 2010 –
Q2 2012 (thousands subscribers)

Europe, with a subscription TV market that still has its growth drivers, may think that it is preserved from the tension across the pond, but its dependency on the US industry is twofold. Europe lags behind in many ways in terms of content and technology. It is dependent on US audiovisual products, and the entrants in the Internet market that master technology and interfaces come from the United States.

What is the solution? Risky changes.

Rights holders must make the release windows and network-centric agreements model suppler to make content available. In Europe, the production industry must structure itself without further delay. In Europe, and to a lesser extent in the United States, TV channels fund audiovisual production and thus play a video library management role that must be strengthened, as in the film industry.

TV packagers must do away with their lucrative but ossifying model of packaging channels and instead offer consumers what they want.

Distributors must distribute, whether over managed networks or the Internet, and they should be paid for this service (and not the contrary, which is currently the case for wireline operators).

OTT video services will continue to grow and influence the TV access market because this is what users are demanding: flexibility and richness of content offerings, prices (a monthly subscription to Netflix equals the purchase price of a DVD), "anywhere, any terminal" usage habits – unlike operators' segmented offerings, and user-friendliness (these new entrants usually offer much more accomplished consumption interfaces).


Jacques BAJON,
Head of  "Video Distribution" Practice

More information on our website about the in-depth market report dealing with this topic

About Jacques: He joined lDATE in November 2000, working as a Director of Studies. His assignments primarily involve strategic and sector-specific examination of the television/video and its distribution modes, from broadcast to telecoms/IP. He more specifically addresses digital delivery ecosystems and linked services. Jacques’s previous experience includes freelance analyst for the Eurostaf / Les Echos group, carrying out market research and analysis of media and telecommunications industry companies, in addition to gaining experience in market analysis working for Ericsson. Jacques holds a post-graduate research degree (DEA) in International Economics (Université Paris X Nanterre) , a Master in Strategic Management of Innovation (Toulouse Graduate School of Management), and followed a training session in Investments in Telecom Networks from Télécom ParisTech.

6Dec/12Off

Crises and rebounds in the games industry

MICHAUD Laurent

Laurent Michaud

Head of consumer electronics & digital entertainment practice, IDATE

Each year IDATE conducts studies on video games and accompanies enthusiastic project developers who rub shoulders with a market that will make them no concessions. Laurent Michaud, Head of the Consumer Electronics & Digital Entertainment practice at IDATE shares it takes on this in the article below.

It is now nearly 12 years that I have observed the sector with the eyes of a player and economist. We have dealt with all the issues that have made the news: we are going to cover our third home console marketing campaign, in the early 2000s we studied massively multi-player games, the advent of video games on mobile phones, then Occasional Gamer, in-game advertising, the App Store phenomenon, Serious Gaming, cloud gaming, games on smart TV, social gaming... In the background, dematerialisation remains the common denominator for all of them.

Alongside these studies, we have helped nearly forty project carriers by providing expertise regarding the techno-economic feasibility of their games, the industrial positioning of their company, their internationalisation strategy, construction of their business model, design of their outline business strategy...

These 12 years in practice enable me to draw some conclusions on what we are experiencing today as a crisis in the growth of the on-line games sector and a more acute crisis that could become a reality for certain traditional actors (those who develop games on physical media).

Video gaming is in crisis and the companies affected are not the least known: Gameforge, BigPoint, Zynga, but also THQ, Sega, Turbine to name only those... and I am not mentioning the myriad of small companies not really known for the big hit, which were formed to develop games for mobile phones, tablets or on Facebook and which are struggling to obtain a return on quite modest investments in a market where supply is abundant and it is difficult to differentiate oneself.

What are the causes of this crisis, beyond the effects of increased competition? I count four:

1. The video game evolves in phases of growth and decline determined by the life cycle of the hardware. Game consoles register their activity in physical cycles of at least six years. We are currently experiencing a downward cycle, a transition phase between two generations of home consoles characterised by income from the sale of games for these machines down by 12% between 2011 and 2012 and by 20% for the turnover generated by console sales.

2. We observe massive player support for Free2Play on smartphones, tablets, social networks, in games on browsers or MMOs and soon on smart TVs. Controlled inflation of the price of games for home and handheld consoles maintains the income for this segment but basically players demonstrate to us that the model of the future is Free2Play, of which these are some eloquent examples:

  • The British studio BossAlien published CSR Racing and quickly recorded a monthly turnover of $12 million,
  • According one of its directors, the Norwegian studio Supercell recorded a turnover of $500,000 per day with Clash of Clans,
  • When there is no income, there is always the level of "monthly active users" that shows the attractiveness of games carried by the F2P model - 32 million for League of Legend from Riots Games (no profit conversion rates available), 50 million for Farmville 2 (with, according to observers, a conversion rate of around 2%).
  • An unprecedented wave of MMO games is passing from a subscription payment model to Free2Play: Aion from NC Soft, Age of Conan from Funcom, Star Wars, The Old Republic from EA, Gotham City Impostors from Warner Interactive, DC Universe from SOE, City of Heroes Freedom from NC Soft…

Not to subscribe to this model supported by a large majority of players may constitute a medium-term risk for publishers.

3. In the on-line games market segment the crisis generates its effect on the first generation of developer-publishers. After a successful first game, these companies have recorded considerable and sometimes dramatic growth as regards their income and size of workforce. They now encounter difficulties with their "second game" which struggles to achieve the support of players who had been seduced by the first. However, the on-line games market segment will continue to record a two-figure growth up until 2016. IDATE estimates that the on-line games market will increase from €15 billion at the end of 2012 to more than 23 at the end of 2016 and will eventually represent a little less than 30% of the global market which could rise to €60 billion. If the market continues to grow at that rate it is value creation that will very largely make up for value loss. This observation underlies reasoning on the, as yet inexhaustible, capacity of the Internet to allow innovative game experiences.

4. In the on-line games environment, the operational risk of a game rests synthetically on four elements: content, business model, technical services, marketing and communications. These four pillars necessary for success rest themselves on new skills: community management, collection, processing and analysis of usage data, business and pricing strategy, industrial intelligence... These tasks are often underestimated by development studios more inclined to create content than conceive its publishing, marketing etc.

Thus, the economic rule "adapt or perish" was never more true than today in the games industry, and never has this rule applied as rapidly as today. Production times for terminals are being reduced on many platforms (mobile phones, tablets, social networking and browsers): as a result, the "time to market" is very short as, at times, is the time that separates the developer from failure.

This statement is difficult to hear: the developer, as Peter Molyneux said so well in a recent interview on Games Industry International, "is not supposed to make games for money. He is also reluctant to talk about monetisation." The games sector is recent and, since the industrialisation of the development market segment in the mid-90s, the job of the studio has been to create a games experience, not to take on board its commercialisation, carry out its marketing or pricing. This role is still regularly seen as falling to the editor. Today you, large and small developers, should know that that era is past and that your job also consists in selling, if not in integrating upstream of the production chain some thoughts relative to the marketing of the game.

A few reasons for bounce-back

If the crisis is real, the video games sector knows how to rebuild its declining segments, renew entertainment experiences, innovate; blaze a trail beyond the beaten track. This character trait offers some grounds for hoping to see the sector rebound in the very short term.

Here are four good reasons for bounce-back:

1. The next generation of home consoles

I am not dealing at length with the arrival of new home consoles that will boost the industry and, in 2015, hardware included, represent 40% of its income.

2. The promise of games on mobile platforms

Neither am I referring in detail to what games represent on mobile platforms, smartphones and tablets that seem particularly well-behaved in terms of market and complementary, even symbiotic, uses. This segment will hold a share of some 15 % of the market up until 2016 as against some 11 % of the income accruing to games on handheld consoles.

I will, on the other hand, insist on my two crazes:

3. The smart TV game

The arrival of the television connection changes the conditions of use for this terminal. Potentially it introduces a level of interactivity that makes it no longer a passive-consumption device. The connection promises enriched experiences regardless of the nature of the content - audiovisual, social, commercial, entertainment or informative.
In this context, the video game could be an accelerator for the market development of interactive applications on smart TV. It will demonstrate its effectiveness by providing a convincing user experience (with an interaction-immersion accessory, voice recognition and motion detection), based on a viable business model.
Games on on-line TV already seem to be taking five directions:

i) The downloading of occasional games on the set-top box from the ISP. In France, Free offers such a service on its Revolution box in partnership with TransGaming:
ii) Games synchronised with live-broadcast audiovisual programmes. Visiware, (through its PlayAlong offer) synchronises the television viewer, who can be a virtual contestant, with more than 800 games and live-broadcast programmes worldwide.
iii) The deployment of an application used by the television manufacturer or by a third party such as Google: EA has just announced, and it went more-or-less unnoticed, that two of these occasional games were available on Samsung's smart TV and controllable by the South Korean company's Galaxy phones. These are Game of Life and Monopoly.
iv) Cloud gaming is a technology that can home-deliver streamed games via the Internet on a connectable TV. The games consoles were also quick in response as Gaikai, one of the most promising cloud gaming service providers was acquired by Sony Computer Entertainment in early July for 380 million USD.
v) Access to games via social networks: Facebook is a platform of omnipresent coverage, found on most connectable devices (tablets, smartphones and computers). It is also available on smart TV and will provide access to the games catalogue that it offers on computer.

These guidelines lead to or induce convergence, better collaboration between the television actors (channels, programme producers), telecommunications and Internet actors (Internet access and service providers), consumer electronics manufacturers and video games actors. It operates at the technological, content and economic level and in any event it opens a new market segment, especially with the arrival of EA.

4. The ubiquitous or continuous game

Today, one can distinguish three types of ubiquity in video games.

  • The first is a ubiquity of service: the ranking, challenges, friends' games list etc. are ubiquitous. We find this feature on Game Center or Facebook.
  • The second is a ubiquity attached to games. Boostr, developer and publisher of the Urban Rivals game with 25 million players, sets its strategy on ubiquity. This game is available on social networks, tablets, smartphones and on its website. I have single access available, which gives me the possibility of playing indiscriminately on any one of these four single platforms that I pick up according to my wants and the terminal that I have at hand. I also play Football Manager quite a lot, but I open a different game on each platform, which breaks the continuity of the game experience.
  • The third is a ubiquity carried by connected objects. This ubiquity took shape in October 2011 under the game name Activision Skylanders. This game is based on action figures equipped with NFC technology and interacting with the home console and the game. These small figures are placed on a pedestal and are recognised and displayed on the screen. They keep in memory the experience gained during the game until the next connection to another console. 30 million figures have been sold to date worldwide.

In conclusion, video gaming is experiencing successive crises, which, in the end, are technological and industrial adjustments related to its strong ability to innovate and recreate: to me these adjustments seem necessary for a sector that, finally, seems soon set to reach economic maturity.

Laurent Michaud
Responsable de la practice Digital Home & Entertainment, IDATE
l.michaud@idate.org

More information available on ourwebsite.

25Jan/12Off

Hybrid TV Prospects : Impacts of Connected TV

Jacques BAJON

Head of Distribution Video Practice at DigiWorld IDATE

 
 
 

Montpellier, 24 January 2012 – IDATE provides readers of its recently published market report “Hybrid TV Prospects, Impacts of Connected TV”. This study aims to position the hybrid solutions in this new context and to measure their impact on the "big" TV markets.

“Hybrid TV is now a reality. The appealing for OTT video content, amplified by the development of connected TV solutions, is further spurring this trend”, says Jacques Bajon, Head of Distribution Video Practice at DigiWorld Institute. “These developments are attracting the attention of the big Internet companies who will throw themselves into the trend and surely have an impact on the key segments in the video distribution chain.”

IDATE estimates the market for OTT video services on the TV at EUR 3.4 billion in 2015

The market for video services on connected TVs is still only taking shape, as we see the first hints of how players are positioning themselves and how they are structuring their service offerings. Though virtually non-existent in 2010, this market is set to explode. IDATE estimates the market for OTT video services on the TV will be EUR 3.4 billion in 2015, with the following geographic breakdown:

- United States: 40%

- Europe: 24%

- Rest of the world: 36%

Trends in hybrid’s development and positioning of hybrid solutions

Hybrid solutions seem to be positioned in one of four ways:

  1. Two-way broadcast: The DTT/broadband or satellite/broadband hybrid network is becoming the leading network for distributing packaged on-demand and linear offerings.
  2. Cable and IPTV extension: DTT/broadband or satellite/broadband hybrid solutions provide additional coverage to the TV offerings of managed network operators.
  3. Competition with cable and IPTV: The DTT/broadband or satellite/broadband hybrid network offers an alternative to cable and IPTV services.
  4. Optimization of wired networks: Hybrid solutions help alleviate congestion on wired networks, which prioritize Internet access quality over the distribution of managed video services. The potential of hybrid TV distribution varies by market:
  • · In the US, the trade-offs made by cable and IPTV operators will determine the direction the hybrid market takes. Satellite may still capitalize on this solution to counter these operators’ triple play offerings.
  • · In Germany, the hybrid TV landscape will primarily depend on how quickly cable migrates to digital and IP. If the current trend plays out, these operators will play a central role along the same lines as their American counterparts. If not, FTA satellite operators will have the trump card.
  • · In France, where IPTV penetration is extremely high, hybrid could take multiple forms, depending on operators’ strategies. The situation could go one of two ways—cooperation between wired and broadcast operators to provide additional coverage or close competition between networks where the full IP migration of the wired operators would go up against hybrid’s vague efforts in the FTA DTT TV segment.
  • · The UK is the most advanced hybrid market today thanks to the broadcast/OTT combination. This trend will continue, and FTA TV operators will reap the rewards.
  • · In Spain, DTT will play a central role. The DTT + OTT combination will dominate, with additional opportunities for wired operators to expand their coverage using the terrestrial network.
  • · Italy is the country with the most potential for gain from hybridization. The "absence" of two-way TV networks clears the way for partnerships between OTT and broadcast (DTT and satellite) to dominate. 
OTT & Hybrid distribution chain: war-time?

More informations on http://www.Idate.org

________________

Contacts

Jacques Bajon

Head of Distribution Video Practice at DigiWorld IDATE.
j.bajon@idate.org

PR- Emmanuelle Renauld

Presse & Technologies

erenauld@pressetech.fr - Tel +33 (0) 156 566 464

16Jan/12Off

Digital Home & Connected Devices

Laurent MICHAUD 

Head of Consumer Electronics & Digital Entertainment Practice IDATE

 

Internet-ready device sales will reach 1.6 billion units worldwide in 2015 

 

Montpellier, 15 January 2011 – CES 2012 closes tonight at Las Vegas. An edition widely focused on Connected Devices and Smart TV. Directly associated with these emerging technologies, DigiWorld IDATE provides readers of its recently published market report “Digital Home & Connectable Devices” with a detailed inventory of the internet-ready device market: TVs, set-top boxes, home & handheld game consoles, DMA/DMR, DVR, desktop and laptop computers, smartphones, tablets, etc. It also includes market figures up to 2015, along with a series of case studies that supply the foundation for a strategic analysis of the issues facing industry players, and innovative applications that will help further the deployment of the digital home.

“Even before the connected television has become ubiquitous, the TV today accounts for more than 20% of connectable devices sold, in particular thanks to the popularity of game consoles. By 2015, most televisions will be able to access the Web directly through built-in connectivity capabilities”, says Laurent Michaud, Head of the Consumer Electronics & Digital Entertainment Practice at IDATE. “The emergence of digital home solutions has been spurred in part by game consoles and in part by devices dedicated to managing content and providing access to the Web. By providing access to content that is stored or distributed in the cloud, connected TVs, ISPs’ new-generation set-top boxes and now tablets are the new driving forces in the digital home’s development.”

Three innovative connected devices

The emergence of digital home solutions was enabled in part by game consoles and in part by devices dedicated to managing content and providing access to the Web. By providing access to content that is stored or distributed in the cloud, connected TVs, ISPs’ new-generation set-top boxes and now tablets are the new driving forces in the digital home’s development:

  • The connected TV. Although theoretically enabling access to a broader range of services, it is driving a higher degree of integration, especially of user interfaces and the accessories involved in user-device interaction. The proliferation of proprietary solutions naturally limits the influence of the app store model which has been so instrumental in the rise of the smartphone. This segment is still waiting for a “crossover” player capable of imposing an efficient end-to-end solution that combines the device, the user experience, an app store, video products and a payment solution.
  • Thanks to their mastery of managed solutions, ISPs can get new-generation STBs into their customers’ homes which are more in sync with the TV viewing experience. The set-top box can also easily take on additional functions such as gaming, Web browsing, an app store, etc. Because of the market’s potential and ISPs’ desire to continue to invest in acquiring new customers, the STB could eventually become a solution capable of housing all of the functionalities of the digital home.
  • Multimedia tablets mark a decisive step in the creation of a fleet of personal multimedia screens.

In 2010, half of all devices sold were internet-ready

In 2010, close to 560 million connectable devices were sold around the globe: mobile phones, touch-screen tablets, Blu-ray players, multimedia gateways, multimedia hard drives, video game consoles, televisions, IPTV set-top boxes… which represents just over half of all device sales that year.

More than 300 million of these devices are portable (game consoles, tablets, smartphones) and internet-ready, either independently or over a home network. Smartphones alone account for 45% of connectable devices sold in 2010.

There were a total 1.3 billion connectable devices in use at the end of 2010, which accounts for over a third of the deployed fleet of CE devices.

Breakdown of global connectable CE device sales by type of device, in 2010

Source DigiWorld IDATE
 

The TV’s connectivity enabled by digital multimedia boxes, and especially game consoles

In terms of sales, digital multimedia boxes are the prime vector for the TV’s connection to the Web. They account for 8% of connectable device sales in terms of units, and for close to 50% of the devices sold that supply a connection to the Web, well ahead of the connected TV (18%).

PC and mobile phones dominate the connectable device market by a wide margin, with the TV coming a distant third.

Even before the connected television has become ubiquitous, the TV today accounts for more than 20% of connectable devices sold, in particular thanks to the popularity of game consoles.

Breakdown of the global installed base connectable CE devices by type of device, end of 2010
Source DigiWorld IDATE
 

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