GII said it anticipates that paid services will play a leading role in the development of connected TV services, representing 59 percent of the market for video services on connected TV.

“These figures correspond to overall analysis of the deployment of connected TV services, which concluded that the right conditions for rolling out new services were not yet entirely there in early 2012. Therefore, we do not expect to see the market really take off in the short-term,” GII analysts wrote in the report.

Another analysis firm, Idate, released its own report Oct. 5 in response to the GII research findings. Idate notes that the television broadcast sector is dealing with profound restructuring challenges, “as players from formerly disparate sectors, such as TV, Internet and equipment vendors converge on the market,” Idate said in the report.

“We believe we are nearing the end of a double phenomenon known as cord-cutting, in which consumers will combine free access to linear television via digital terrestrial and satellite with a fee-consumption via OTT services, and cord-shaving, in which consumers will scrap their paid cable and IPTV plans for low cost OTT offers or a limited consumption of video-on-demand services,” Idate added.

Idate notes that the United States will remain the largest market for connected TV services, taking up to a 61 percent share of the total international market due to the numerous attractive OTT service offerings in the region. “With the big three TV manufacturers – Sony, Panasonic, and Sharp – reporting billions in losses in the 2011 full-year, TV manufacturers need a lifeline if they’re going to stay in business,” said Idate.  “Smart TVs and connected services may provide such a rescue.”