[Satellite News 08-05-09] The satellite set-top-box (STB) market saw a 6 percent increase in 2008, with growth predicted to be steady for the next two years, according to a report by analysis firm In-Stat, released Aug. 4. The STB market growth is being forcefully driven by triple-digit growth in the Asia/Pacific region.
    The In-Stat report, “The Global Digital Set Top Box Market,” revealed a wide range of STB performance results – with growth or decline depending on market. Digital terrestrial (DTT) set top box units grew by 200 percent in 2008, driven by high-definition (HD) converter boxes supporting the analog-to-digital TV transition in the United States. However, In-Stat predicts that this growth represents a short-term bubble and will decline by 23 percent in 2009 and nearly 30 percent in 2010.
    The IP STB market experienced an impressive 55 percent jump in 2008, but is not expected to sustain its growth. Fewer reported telco TV deployments as well as a drop in unit shipments of IP set top boxes will lead to only slight increases in 2009 and 2010, the report said.
    In August 2008, In-Stat predicted set-top boxes (STB) for the satellite market would account for less than 50 percent of total unit shipments in 2008, affected by the sudden growth of other STB platforms. “While satellite STB shipments will still be growing, they are going to dip to less than 50 percent of total unit shipments, and that will be the first time that has happened since we have been covering this market,” Mike Paxton, principle analyst for In-Stat, told Satellite News.
    In 2007, In-Stat reported that satellite STBs lost the top spot in producing the most revenue for operators. “It was the first time since the mid-1990s that satellite STBs were not the most valuable in terms of revenues,” he said. “Last year, that went to cable STBs, which was something new and unusual. This changed because on the cable side, the average price of the STB to the cable operator is still about $200, whereas with satellite it is still well under $100,” said Paxton.
    As for 2008, In-Stat brings better-than-expected news for the satellite industry. According to the results, while satellite’s competitors in the cable STB market saw an 8 percent increase in 2008 activity to nearly 45 million units, In-Stat predictions for cable in the long-term are not as positive. The report asserts that 2009 will be a negative growth year for cable STBs as the market matures.
However, a November report from ABI Research asserted that the global set-top box market, in general, will see shipments peak in 2012, followed by a slow decline.
   Set-top box unit volumes for all platforms — digital terrestrial television, IPTV, direct broadcast satellite and cable — will begin a gradual decline, according to “Global Set-Top Box (STB) Markets,” which provides an overview of the global set-top box market.
    The decline in shipments after 2012 is due in part to the expected completion, in most developed countries, of the transition to all-digital television broadcasting. Pay-TV platforms in particular are affected by the threat of displacement by over-the-top video, and the substitution potential of residential gateways, media hubs and gaming boxes. Set-top box components will increasingly be integrated into TVs themselves.
    In-Stat said that similar trends are showing throughout all the STB markets, as personal video recorders (PVRs) and HD are reported to be the leading technology drivers of the sector. With multi-room PVR service becoming available in an increasing number of cities in the United States over the last year, global PVR unit shipments exceeded 25 million across all STB types in 2008, an increase of 14 percent over 2007. HD Satellite STBs will comprise 18 percent of total unit shipments in 2009, the report said.