IPTV Market Overview
The global IPTV market was valued at $43,254.0 million in 2017 and is forecasted to witness a CAGR of 14.7% during 2018-2023. Availability of high-speed broadband networks and increasing demand for video on demand (VoD) services are the two key factors driving the growth of the market.
APAC IPTV MARKET, BY OFFERING, $M (2013 - 2023)
On the basis of transmission method, the IPTV market has been categorized into wired and wireless methods. Between these two, wired transmission held a larger revenue share in the market, valued at over 53% in 2017. This can be attributed to the fact that this system requires real-time data transmission, and internet protocol usage is sensitive to packet loss delays if the streamed data is unreliable. For better connectivity and preventing picture break-up and data loss, users are more inclined towards deploying wired transmission methods for such systems.
The ‘offering’ segment is further classified into bundled and standalone systems. Bundled systems contributed a larger revenue share in IPTV market, accounting for more than 79% in 2017, owing to the growing acceptance of internet and time-shifted programs among populace, globally. Users, especially residential users, prefer IPTV in conjunction with VoD, and internet services such as voice over IP (VoIP) and web access, resulting in a larger market for bundled services.
On the basis of application, the IPTV market has been categorized into linear and nonlinear television. Linear television held a larger share in the market, valued at over 62%, in 2017. This can be attributed to the fact that the aged TV viewers or the ones who are technically challenged, do not want to deal with new gadgets while watching their favorite content. It has been observed that majority of population follows traditional TV-viewing, with scheduled program broadcasting. Again, by a provider’s perspective, the cost it takes to create, sell, and broadcast big-budgeted shows is too high to be ‘in-budget’ for nonlinear television streaming.
However, it has been observed that the growth in the IPTV industry is mainly attributed to nonlinear streaming, owing to the change in trends, more inclination of users to pay for the video content they want to watch, and millennials getting more accustomed to utilizing digital on-demand services. Moreover, on-demand TV allows the viewers to watch from any device, without any requirement of confining to the original airtime of the shows. Hence, during the forecast period, the IPTV market for nonlinear streaming is expected to witness higher growth, at a CAGR of 17.2%.
IPTV Market Dynamics
Availability of fast broadband networks and bundle offers from telcos are the key drivers of the growing IPTV market globally. The VoD concept allows the consumption of on-demand videos through varied digital platforms such as PCs, and interactive TVs, which makes users more inclined towards this service.
A bundle package of VoD, internet TV, and associated features attract viewers owing to the convenience and smart technological features the package offers. Besides, addition of high-definition channels and hybrid services, are also the key factors in the growth of the IPTV market. The technology has been increasingly developed by the multi-media, telecommunication, and network research players, with growing demand for high definition video programs and VoD by customers, owing to the necessity of advanced network development by content network providers.
Inclusion of additional services by the providers along with pure play IPTV service, has added to the revenue sources and strengthened the prospects for the market growth.
Growing need of consumers for high-quality and reliable online experience is likely to offer growth opportunities for the market during the forecast period. Growing demand for over-the-top (OTT) services and changing preferences of users globally, are estimated to influence the IPTV market positively. The digital broadcasting ecosystem is widening at a fast pace, leading to growth in consumer demand, thereby unfolding immense growth opportunities for service providers in the industry. This is also prompting key players to diversify their revenue streams by providing IPTV services along with OTT and pay-tv services. The emergence of new technology and advanced products is estimated to generate promising growth opportunities in the coming years, for the players operating in the IPTV market.
There are regions such as Middle-East and Africa, where very little regional premium content is produced, and most of the shows are produced outside. Operators require huge investments to secure exclusive content, which is an intensive task. This results in cost inefficiency and additional expenses, considering the widespread practice of privacy in such areas. Thus, protection of content and the prevention of piracy remains a challenge for the operators.
As IPTV is deemed as both a content service, and a telecom service, thus decisions regarding this technology lie with authoritative bodies associated with both. Thus, regulatory compliances hamper the growth of the IPTV market, along with issues such as less content availability and the need to upgrade access networks.
IPTV Market - Competitive Landscape
Players in the IPTV market are emphasizing on content acquisition and wider broadband availability. The service providers can tailor their services as per customer requirements for data rates, channel line-ups, and distribution modes. Further, the entry of new players in the industry is projected to intensify the competition, owing to which, the number of services offered by the providers increases and the cost of products decreases.
Telecom operators are delivering a comprehensive “TV Everywhere” service with the growing popularity of internet-based TV services. These operators provide such services to other content providers and service providers; for instance, AT&T Inc., Deutsche Telecom, and Sky plc are offering multi-screen services free of charge to their viewers.