Global shipments of pay TV set-top boxes (STBs) are on track to grow by nearly 40% by 2012, according to a report by Futuresource Consulting.
This represents an increase of 38 million units, with growth derived from new subscribers and consumers upgrading to STBs with Personal Video Recording (PVR) functionality and High Definition( HD) capability.
"Consumer desire for higher spec and higher value products is providing the market with buoyancy," said Carl Hibbert of Futuresource Consulting, "but as features such as HDD and MPEG-4 continue to move mainstream, competition will bring down prices and reduce future margins.
He added: "The next five years will see further consolidation in the STB industry, with smaller vendors being absorbed or pushed out, especially as China's major OEMs and brands increase their drive on export markets. And in a commoditising market, the long haul survivors will be the ones with solid account relationships, competitive economies of scale and/or unique competencies in software or end-to-end network solutions."
Futuresource research shows that Europe the Middle East and Africa accounted for the largest proportion of demand in 2007, generated through rapid subscriber adoption across both cable and satellite, with analogue switch off generating additional traction for DTT boxes.
By the latter part of the forecast period Futuresource predict, Asia Pacific will become the dominant territory, accounting for nearly 50% of global demand.
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