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Connected TV sales on the rise

According to the DisplaySearch Q3’10 Quarterly TV Design and Features Report, the category is forecast to grow to over 118 million in 2014. We’ve already seen internet players like Google and Apple bring their own boxes to the market, but they’re not alone. TV set makers continue to develop new service platforms to offer a variety of new formats for TV viewing, while broadcasters are also launching their own standards and portals this quarter, such as Hbb.TV and YouView.

Figure 1: DisplaySearch Connected TV Forecast (2009-2014)

Source: DisplaySearch Quarterly TV Design and Features Report

“It’s an exciting time for the connected TV sector,” said Paul Gray, DisplaySearch Director of European TV Research. “It’s a battleground where TV set makers, internet video companies, free-to-air broadcasters, pay-TV and the IT industry are all rushing to stake their claims.  IPTV is moving from being a technology to becoming recognizable service offerings.”

Despite the growth of the connected TV segment, no clear front-runner has emerged.  Only around 10% of the connected TVs sold in Japan have joined a network so far, while expectations for North America have been scaled back as the TV market struggles in the region this year.

Gray added, “It has been a long, challenging journey so far, especially with new competitors like Google TV joining the battle. Set makers will have to acquire new skills such as negotiating content deals in order to succeed. I think most of the TV supply chain senses that this is a seismic shift in the usage of TV that will be far more significant than 3D, which will not alter TV function or usage patterns.”

It is expected that the connected TV market will split, with basic connected sets carrying enhanced services such as Hbb.TV, YouView and VuDu, while the smart TV segment will encompass configurable apps, sophisticated search and navigation engines, and advanced user interfaces. DisplaySearch defines a smart TV as one that can retrieve content from beyond walled gardens, has intelligent search and recommendation, is upgradeable by its owner, and is able to network seamlessly with other devices in the home.

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Laura Khalil
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