Increased Broadband Penetration Driving Growth of Global IPTV Market; To Surpass US$79 bn by 2020

IPTV stands for Internet Protocol television and any user with an IP device such as a tablet, laptop and smart phone can avail IPTV service anytime and anywhere as long as the user has access to high speed broadband internet. With increasing demand for high definition video entertainments and Video on Demand (VoD) by customers, the content network providers have witnessed necessity of advanced network development. The IPTV has thus been intensely developed by the multi-media, telecommunication, and network research players.

With the availability of broadband infrastructure and new video compression technology, IPTV provides a technological opportunity to broadcast live TV signals to any smart device and a television set through private broadband networks. Additionally, it provides a platform for telecommunication companies (telcos) looking for potential opportunity to foster its revenue beyond voice and data services.

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The IPTV market is witnessing shift in consumer dynamics, largely influenced by declining price and infrastructure development. North America and Western Europe are at verge of getting matured with high penetration of IPTV subscribers. Therefore, telcos in these regions are offering low cost high-end channel packages along with additional services, resulting in increased average revenue per user (ARPU). Asia Pacific is witnessing highest growth rate of internet penetration worldwide. As IPTV services are distributed on high speed internet networks, the growth of IPTV market is directly proportional to growth in broadband penetration.

Government regulations promoting digitalization in Asia Pacific countries, such as India, have further augmented the growth of broadband penetration, subsequently contributing to proliferation of IPTV services. Additionally, regions such as Middle East and Africa have also observed increased in internet users with high speed connection. Increasing broadband penetration has helped improve accessibility of IPTV services in these regions, thereby adding to the addressable consumer base. Inclusion of additional services by IPTV providers such as interactive services along with pure play IPTV service, multi-screen services, have added to the revenue sources, and fortified market growth prospects in the long run.

The IPTV market is segmented on the basis of end-users into enterprise and residential end-user segments. IPTV is attracting significant corporate interest as a tool to communicate with employees, improve training, satisfy compliance requirements, and reduce travel costs. Corporate entities and enterprises across the hospitality, education, finance, media, energy, healthcare, and transport sectors use IPTV services and leverage it to build additional revenue streams such as targeted advertising on demand video. These entities also use IPTV solutions to distribute on demand content, events, archived and live news, company-wide briefings, the employee desktops and public screens spread across their corporate network.

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Growth of the IPTV market is also driven by factors such as the rising demand for video on demand, high-definition channels and hybrid services along with IPTV services. Instead of several driving factors, the IPTV market faces several challenges especially in the developing regions such as lack of infrastructure to offer a service free of delays and jitters, and maintaining the quality of IPTV services with the offered prices.

In regions such as MENA, there is very little local or regional premium content production, due to which most shows are produced outside this region. Operators require huge investments to secure exclusive content, which involves enormous effort on their part. This becomes cost inefficient adding further expense and becomes a daunting issue, particularly considering the widespread practice of piracy in this region. Thus, protection of content and the prevention of piracy remains a significant challenge for the operators.

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