IPTV operators play catch-up

John C. Tanner
25 Jun 2012

You know that the IPTV business is ready to move on to the next level when Ikea gets into the connected-TV business.

Yes, Ikea. In April, the Swedish furniture maker announced Uppleva, which is essentially a TV cabinet with a 1080p LED TV built into it. The TV itself manufactured by Chinese electronics firm TCL will be available in sizes from 24 to 46 inches, and will include an integrated Blu-ray player and a wireless subwoofer.

More to the point, it will also come with an open web browser (reportedly Opera for TV). Viewers will be able to access popular user-generated video sites like YouTube, Vimeo and Dailymotion. And Uppleva will ship with up to 20 apps that can facilitate music playback, games, VOD and catch-up video.

All that for around $960. Ikea intends to launch the connected TV in Europe this year first, with plans to take it to the US next year. So Asia will probably have to wait awhile before Uppleva arrives here.

In any case, the fact that Ikea is getting into the connected TV business now is telling. Last year, internet-enabled TVs accounted for a quarter of all TV sets shipped. By 2016, they'll account for 70% of new TV sets, generating more than $117 billion in revenue, according to IMS Research. And more and more of them like the Uppleva will be mid-end products.

All of which is indicative of how television consumption itself is changing as internet connectivity becomes a more integrated part of the TV experience. And it's also a leading sign of how IPTV operators need to change as well.

IPTV is still a growth market globally - Point Topic recently reported that IPTV subscriptions approached 60 million at the end of 2011 (see IPTV Status on page 8), with revenues up over 30%. But with market saturation starting to curb growth in early-adopter markets, and as smartphones, social media and OTT content become a bigger part of the story, IPTV is fast approaching that inflection point where it can't survive as a mere a value-added TV channel aggregator.

Many IPTV players are already looking at things like multi-screen strategies to deliver their services across TV sets, smartphones and tablets. But that's just scratching the surface of possibilities. The next stage involves not just connected TVs, but connected homes, where the home gateway that provides video distribution can also enable services like appliance remote control, security, healthcare and energy management, as well as various cloud-based OTT services.

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