Internet television—or IPTV—is mostly a pipe-dream right now, with a handful of services up and running, many of which are limited to small trial markets. And who wants to have Mom’s bad celebrity dancing show pulling bandwidth from your eight-way first-person shooter Internet deathmatch?
But market research firm iSuppli says the IPTV market is poised to explode from just 2.4 million users in 2005 to over 63 million users worldwide (and $27 billion in revenue) by 2010: a growth rate of 92.1 percent.
“The fight to capture the expanding base of IPTV subscribers will put telecom operators on a collision course with existing pay-TV market competitors and with a new class of broadband video portals as they roll-out progressively more sophisticated offerings,” said Mark Kirstein, iSuppli’s vice president of multimedia content and services, in a statement.
Video services are expected to generate the majority of the estimated $27 billion revenue pie, but about 14 percent of the moneybags rolling in from IPTV operations will stem from value-added media services and advertising.
iSuppli sees IPTV rolling out in three phases, the first being basic service deployment, followed by a selection of value-added interactive services, and then, as the medium matures, substantial increases in interactivity, integration, and viewership. IPTV capabilities are expected to eventually include highly personalized, in-content advertising, as well as value services like home security, data communication, network management, home media applications, and of course content-focussed offerings like on-demand music, games, and movies.
And who will lead the IPTV revolution? Not the United States: Asia is expected to be the largest IPTV market through 2010 in terms of subscribers, although the North American market is expected to lead in terms of revenue generation.
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