The demise of the set-top box has been forecasted at least since the initial talk of an integrated digital television set (IDTV) (see here for one early discussion and the arrival of CableCARD IDTVs in the U.S. market in 2004. IMS Research now is predicting worldwide shipments of IDTVs will grow to 143 million in 2013 from 52 million in 2007. Does this mean that the end is finally approaching for the set-top box? Not yet, according to Stephen Froehlich, IMS senior market analyst. "The set-top box market on a worldwide basis is growing quickly enough that this will eat into growth, but not decline volumes," he said. "It could potentially cut volumes in half in U.S. cable, but this will take time to build up." Cost vs. benefit Until now the CableCARD and OpenCable Unidirectional Receiver devices have been one-way, and thus not very enticing to U.S. consumers who want more functionality and need a set-top from their cable provider to get it. Citing figures from NCTA, IMS reported that only 372,000 set-top boxes have been "displaced" by IDTVs as of June 2008. The current number of installed set-tops is 55 million. Tru2way adds a new dynamic, providing CE devices with the ability to access a guide, VOD, SDV and other applications. Samsung, Sony, LG, and Funai already have agreed to manufacture tru2way-certified IDTVs for the U.S. and Korean markets. Operators naturally have been hoping to reduce capital expenditures by passing off the cost of this equipment to the consumer. Also, if something goes wrong the consumer is responsible for replacement, not the operator, Froehlich said. (That assumes that the consumer electronics model works, i.e. that so many things don’t go wrong with tru2way boxes that retailers stop handling them to cut return-sales losses.) "On the flip side, the CableCARD is adding complexity and increasing truck rolls at a typical cost of $150 (per roll)," Froehlich said. In addition, cable operators had to deal with the cost of adjusting to an open conditional access mandate, but they have already "eaten" that cost and are "trying to make the best of it." Plus, these questions remain: At what price premium will consumers purchase a tru2way IDTV? And will they see it as worth it in the end? "It is not as if an IDTV will ever have more functionality than a comparable set-top box," Froehlich said, listing among consumer benefits consolidated remote control functions and a "prettier" living room with no set-top box. Plus, the lifespan of a television is ten years while it is five for a set-top box. "By the time TVs get old, the receivers inside them will be outdated. They will eventually need a set-top box anyway," Froehlich said.

– Monta Hernon

The Daily


Doing Good

T-Mobile is donating $1.25 million towards causes that are advancing educational equity for LGBTQ+ youth. A sum of $1 million will be directed towards the Human Rights Campaign Foundation ’s new financial

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