100 Million DTV Devices In Europe By 2007, Says Report
Developments in the European digital TV market are sparking demand for receivers and a new report from Datamonitor claims that shipments of adaptors are set to increase eightfold over the next four years.
Basic set-top boxes (STBs) have helped to drive the digital revolution, particularly in the UK where £100 devices have been behind the success of Freeview (see Forecasts). These low cost adaptors are seen as crucial to the development of global TV markets as they enable standard television sets to be converted to receive digital terrestrial television (DTT). This is of particular concern to governments in developed countries committed to a switch-off of the analogue signal.
Datamonitor estimates that STB shipments will grow from 1 million today to 8 million in 2007. However, these devices have now been joined on the market by integrated digital televisions (IDTVs) and personal video recorders (PVRs) and analysts believe that sales of these high-end products will increase as more free-to-air services appear across the continent and economies of scale result in falling prices.
It is thought that IDTVs will satisfy consumers households looking to replace existing television sets and access FTA services, with platforms dominated by pay-TV operators providing only limited opportunities.
Consumer uptake of PVRs was slow in 2002 because of the late rollout of services but growth is accelerating and the report claims there will be an installed base of 14 million devices by 2007. Impetus will come from pay-TV satellite operators keen to drive up average revenues per user (ARPU) and improve subscriber loyalty.
Adrian Drozd, technology analyst at Datamonitor, commented: “The emphasis of the European device market is changing, moving away from the ‘standard’ functionality STBs that characterised the early development of the sector. The device market is now diverging – while advanced devices including PVRs and IDTVs, are becoming more commonplace, a lower tier of basic ‘adaptors’ is also emerging to meet the need for low-cost devices providing an inexpensive alternative for operators and consumers alike.”
Satellite is expected to remain the largest platform with regard to the installed base of devices but it faces growing competition from cable and DTT. This is demonstrated by the fact that while the installed base of satellite devices will approximately double between 2002 and 2007, DTT will swell to almost twenty times its original size.
Boosted by the Freeview effect, the UK will remain Europe’s leading DTV market with penetration set to reach 72% by 2007 (see UK Digital TV To Reach 72% Of UK Homes By 2007, Says Datamonitor). The country will also see strong PVR uptake and a higher than average proportion of houeholds taking a second device. Growth will be less pronounced in Germany and the Benelux countries with slow development of digital cable in these markets hampering the uptake of PVRs and second devices.