Multi-Feature Broadband Boxes Coming To The Living Room

According to a new report from Allied Business Intelligence (ABI), set-top box (STB) equipment is increasingly equipped with advanced features, such as PVR (personal video recorder), VOD (video on demand) and video networking capabilities. These boxes are described as residential gateways and are becoming “complex brain centers” for the living room, according to the report.

The competition for revenues amongst multiple service operators (MSOs), along with technological developments, will lead to improvements in home entertainment. However, the cost of STBs will rise as their gateway capabilities are augmented, says ABI.

“MSOs are demonstrating the willingness to spend more on increasing the functionality of set-top boxes,” said Adam Becker, a senior analyst with ABI and the report author. “With anemic growth of basic subscribers, reducing churn and increasing revenues per subscriber are the major tenets of service provider strategies. They can see the return on investment potential and can justify the investment.”

In 2002, 33.4 million STBs were sold worldwide, with 3.8 million of those units incorporating PVR functionality. By 2008, ABI predicts that of the 72.5 million STBs shipped, approximately 68%, or 49.2 million units, will have PVR capabilities.

A recent analysis from eMarketer predicts that broadband access is on course to enter the mainstream of US residential homes (see Broadband Set To Enter The Mainstream, Says eMarketer).