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TV 2.0: HDTV, Program Guide and DVR Outlook

  |  October 13, 2004   |  Comments

Next-gen TV technologies still lag, though the future looks promising.

The next generation of TV viewing technologies, including HDTV, Digital Video Recorders (DVRs) and interactive program guides, are set to grow modestly according to a flurry of recent research.

HDTV: Growth, but not hitting FCC expectations

Strategy Analytics forecast by 2008, 37 million US households will receive high-definition programming. By the end of this year, they predict over 14 million US households will own some type of HDTV capable hardware, up from only 8.7 million at the end of 2003. Despite the rapid growth curve, the adoption numbers will not, in Strategy's Analytics view, be enough to hit the FCC's goal of a full transition to the new standard within the next five years.

Interactive Program Guides (IPG): Three Companies Dominate

Viewers increasingly turn to interactive program guides (IPGs) to find out what's on TV, according to the latest research from InStat/MDR. IPGs are built into a variety of consumer electronics devices, including Digital TVs and Personal/Digital Video Recorders (PVR/DVR). The IPG market over the next four years is expected to grow at a compound annual growth rate (CAGR) of 36.9 percent, to projected revenue of nearly $1 billion by 2008. In a report, "Interactive Program Guides (IPGs) - the "Killer App" for Enhanced TV," the firm predicts three companies: Gemstar-TV Guide, Microsoft and Tribune Media Services, possess the wherewithal for long-term success and survival.

"IPG will still provide niche business opportunities for a few companies like Pioneer, Scientific Atlanta, and some in Asia and in Europe," Gerry Kaufhold, Principal Analyst Converging Markets and Technologies at In-Stat/MDR told ClickZ. "But for the most part, the 'big three' will still be defining the IPG market during the next five years or so."

Worldwide Value of IPG Usage
Fees and Licensing Fees
Worldwide
Total Revenues
Growth
Rate (%)
2003 $206.8 -
2004 $282.1 36.4%
2005 $390.7 38.5%
2006 $538. 37.7%
2007 $733.3 36.3%
2008 $995.9 35.8%
Compound Annual
Growth Rate
36.9%
Note: Annual Value in US$ in millions, annual
growth rate, Compound Annual Growth Rate
Source: In-Stat/MDR

DVR: Standalones will be the minority

According to a new Jupiter Research report, "PC and Standalone Digital Video Recorders: Strategies to Cope with an Uncertain Market," DVRs have failed to take off with consumers. While 55 percent of survey respondents own a DVD player, and an additional 10 percent plan to acquire one in the next year, a meager 4 percent currently own a DVR and only 4 percent more plan to buy one in the coming 12 months.

Device Ownership and Plans to Buy
Device Currently
Own
Plan to
Buy
Standalone DVD Player 55% 10%
Portable Music Player 27% 6%
Digital Surround Sound
Home Theater System
22% 6%
HDTV TV or Set-top Box 8% 5%
Portable DVD Player 7% 3%
DVD Recorder 6% 7%
Portable TV Set 9% 1%
DVR 4% 4%
Source: Jupiter Research

The report forecasts satellite and cable DVR providers will be the winners, controlling 80 percent of the market by 2009. Standalone units, such as TiVo and PC-based DVRs, currently represent only 39 percent of market share. That number is expected to drop to 20 percent by 2009.

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