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Report Estimates Worldwide iPTV Service Revenues to Pass $42.6 Billion by 2014

By Calvin Azuri, TMCnet Contributing Editor

The service revenues of Worldwide Internet Protocol Television (iPTV) are going to surpass $42.6 billion. This is an estimate made by Global Industry Analysts, Inc. in a new report. Global Industry Analysts, Inc., is a globally recognized publisher of off-the-shelf market research.

If this estimate proves to be accurate, it will reflect a CAGR of 60.2 percent over a period of 10 years, from 2004 to 2014. At present United States and Europe are generating greater service revenues, as compared to Asia Pacific. This is a result of higher ARPU (average revenue per user) in these regions. By the year 2014, the number of worldwide users is also expected to exceed 248 million.

iPTV is seen as an application that allows the triple-play combination of services. The emerging trend is to combine information, communication and entertainment, forming a new market ICE. This market is comprised of Telecom and media companies banding together. The iPTV technology is yet to take off commercially, however. There isn’t sufficient information about the customer experience with iPTV. iPTV services, also, do not solely depend on the bandwidth availability, but, rather operators need to integrate end-to-end solutions for offering high-class video services through streaming technology.

In spite of various difficulties, iPTV is set to become wildly successful, and there are indications of fast growth in the infrastructure. The capital expenditure on iPTV is expected to increase by more than 14 times by the end of 2010. Companies are expanding with iPTV as this technology has the potential to offer unprecedented interactive experiences to users.

The European market is seeing a significant upward trend in growth, over the last few years. This is seen as a result of fierce competition and an increasing customer demand. Asian and North American markets are not far behind either. Notwithstanding Asian competition, Europe is likely to continue its dominance on the global iPTV market through 2009, with Asia rapidly closing the gap.

China is proving to be a leader in this particular segment, as the country is seeing economic development, rapid urbanization, and growing middle-income group. The US is expected to be the hardest market to penetrate, because of high pay-TV penetration, the many competing companies and rising service competition among satellite and cable operators.

General awareness of iPTV is considered to be low but, there is a rise in demand, mainly concentrated on the segment of young adults. Cost is the major barrier for consumers to adopt iPTV in all the countries across the globe. Despite all odds, however, the global iPTV industry is steadily growing and this trend is likely to continue.

Major iPTV carriers/operators in the market include AT&T (News - Alert) Inc, Belgacom, Bell Canada Enterprise Inc, British Telecom, China Telecom Corporation Ltd, Comcast Corporation, Deutsche Telekom AG, FastWeb TV, France Telecom SA, PCCW Limited, Qwest Communications International Inc., Telecom Italia SpA, and Verizon (News - Alert) Communications Inc. Key iPTV vendors/system providers include Alcatel-Lucent SA, Cisco Systems Inc, ECI Telecom Ltd, Entone Inc, Envivio Inc, Microsoft Corporation, Motorola (News - Alert) Inc, NEC Corporation, Orca Interactive Ltd., Sprint Nextel Corporation, Widevine Technologies, and Viaccess S.A.

Calvin Azuri is aTMCnet Contributing Journalist.

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