According to research from IDC, in light of
the ever changing media landscape, competitive pressures will extend
beyond traditional Free-to-Air (FTA) TV networks and pay-TV operators
due to IPTV entrants as well as Internet video services, given that
consumers are turning to the Internet for video sources.
IDC says that initially this is occurring from Peer-to-Peer (P2P) file
sharing networks such as BitTorrent for premium studio content, to
personal blogs on MySpace or Google Video and YouTube for
user-generated content. Other sources are legitimate online video
services such as ReelTime and possibly the Australian iTunes store in
the future.
"Today, quite a significant portion of Internet video users watch full
movies and TV shows, and almost 30% obtain sports content over the
Internet, which is one of the major drivers to pay-TV service adoption.
Those who do not watch Internet videos have indicated that they do not
want to watch videos on the PC screen and this immediate advantage FTA
TV and pay-TV operators have over current online offerings will soon
diminish. This is due to broadband service providers (BSPs) introducing
IP set-top boxes to deliver online video content directly to the TV,
along with the adoption of multimedia networks that stream content from
the PC to the TV," said Sophie Lo, IDC's Analyst for Consumer Digital
Markets.
However, local BSPs should watch innovative players like Apple, who are
addressing the barriers that are currently inhibiting digital home
adoption. For example, Apple will launch iTV (still a codename), early
next year in the US iTV is a media adaptor / set-top box-like product
that will access content from computers on the network for display on a
TV. "By adding connectivity to their current service-device integration
model, Apple is providing consumers with a complete end-to-end
solution. Going forward, the iTV could possibly disrupt BSPs' strategy
in establishing the home gateway as the media hub," cautioned Ms Lo.
This study, titled "Australia Digital Terrestrial, Cable, Satellite and
IPTV 2006-2010 Forecast and Analysis: Videos from the Pipe,” is IDC's
annual five-year forecast of the Australian digital TV market and
presents the 2006-2010 forecast for digital-TV households and consumer
spending on digital pay-TV services in Australia. A breakdown of
digital terrestrial, digital cable, digital satellite, and IPTV is
included.
The IDC study finds that:
# Digital cable and satellite revenue growth rates will be higher than
that of subscriber growth as the Average Revenue Per User (ARPU) will
increase, thanks to the take-up of advanced services such as on-demand
programming and digital-video recording.
# IDC does not envisage another IPTV entrant until late 2007 or early
2008, as Telstra remains reluctant to enter the IPTV arena due to its
equity in FOXTEL. Tier 2 and tier 3 BSPs lack a large broadband
subscriber base, financial resources as well as experience in content
acquisition and distribution.
# Although local telcos have not yet entered the IPTV market, their
global counterparts - such as France Telecom and PCCW - have already
established IPTV business models. Thus IDC expects local telcos'
initial IPTV offerings to be relatively advanced and reliable, as the
solutions have already been implemented by telcos overseas, and
business models are in place.
# Current pay-TV operators are growing their subscriber bases by
launching aggressive marketing campaigns that are targeted towards the
mass market. A divide between high- and low-end users will
emerge.
Apple iTV could kill the TV star, Warns IDC
New research into the overall Australian digital TV landscape finds that free to air TV is coming under ever growing pressure IPTV and Internet video services.
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