The market for cable set-top boxes will be flat for the second year running in 2003, according to new research from In-Stat/MDR.
The report,
As Demand Stays Flat, Cable Set-Top Boxes Evolve claims that demand for digital cable receivers remains soft as cable TV operators continue to reduce their capital expenditures. Global set-top box unit shipments are projected to reach 9.97 million this year, down slightly from 10.03 million unit shipments in 2002. Revenues are predicted to be down 15% at around $1.86 billion.
There is little doubt that the rising popularity of TiVo-style devices and digital satellite platforms has increased the pressure on cable operators. Moreover, recent analysis from McKinsey Quarterly has shown that churn rates for digital cable in the US are twice as high as they are for standard analogue cable services (see INSIGHTanalysis: Will On-Demand Save Cable?).
On the plus side, manufacturers are not standing still and are continuing to develop new products that support interactive video and communications services.
“Many of these products, particularly cable set top boxes that support HDTV service or come with integrated Personal Video Recording (PVR) capabilities, have become quite popular with both cable operators and cable TV subscribers,” said Mike Paxton, a senior analyst with In-Stat/MDR. “In fact, those cable set top box manufacturers who have moved the fastest to develop and deploy these new products have been rewarded with increased market share.”
There is considerable excitement about the potential of digital cable set-top boxes with integrated PVR capabilities. Last year, there were only 80,000 worldwide shipments of these devices but this total is expected to increase tenfold this year.
Overall, InStat/MDR expects the market for digital cable set-top boxes to remain relatively flat for the next few years, with unit shipment totals averaging between 10 million and 11 million boxes per annum.
Long term market growth is thought to be dependent on wider availability of digital cable TV services in Western Europe and in parts of Asia, a development which should begin to occur in the next three to five years.
