|The race for HD continues to drive the US digital TV market as advanced set-top boxes, including HD, DVR, and HD DVR comprised more than 55% of total STB shipments in the US in 2007. However, 2009 analog switch-off has created a short-term “last gasp” market for basic STBs in the form of subsidized digital-to-analog (D/A) converters that are estimated to ship between 24-30 million units over the next 12-15 months. |
“In the US, operators are focused on up-selling their current digital tiers to HD with free truck rolls, free installation, and attractive pricing making the transition to HD relatively painless and inexpensive,” states Mark Meza, digital TV analyst for IMS Research. Faced with bandwidth constraints, TV operators have been marching forward with MPEG-4 AVC infrastructure upgrades including new digital headends and uplink station construction, additional satellite launches, switched-digital video (SDV) technology, large-scale fiber rollouts, and low lease prices for MPEG-4 AVC advanced set-tops. Meza adds, “While Europe and Asia are still lagging behind in the race for HD due to lack of content and other factors, HD and increased interactivity is the end-game in the US digital TV market.”
US in 2007. The market is expecting a short-lived but dramatic upsurge in basic STBs to occur due to the Federal Communications Commission’s (FCC’s) voucher program for D/A converters. Numerous manufacturers, including LG Electronics, Samsung, RCA, and Funai are ready to capitalize on this “one-time” market in the US. Meza adds, “The US Government has allocated much more money to the voucher program than we expect to actually be claimed by consumers. Leading up to analog switch-off in February 2009, we expect a significant amount of analog terrestrial households to either migrate to a basic tier pay-TV service, or to purchase an inexpensive integrated digital TV, which are expected to drop to the $150-250 price range by early 2009.” These two factors alone are believed to slightly lower the expectations for the D/A converter market over the next 12-15 months.