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New Report Analyzes Impact IPTV Will Have on Networks
[January 11, 2006]

New Report Analyzes Impact IPTV Will Have on Networks


TMCnet Associate Editor

A new report from Dittberner Associates shows that although the number of IPTV subscribers will reach 53 million globally in 2013 - up from about 2 million at the end of 2005 - the incremental IPTV equipment market will only reach $336 million in 2013 - up from $30 million in 2005.



The fact that most future IPTV customers will already have broadband service is partly what accounts for the disparity between the increase in the number of IPTV subscribers and the increase in IPTV equipment sales.

“Other studies on IPTV’s effect on network equipment market growth ignore the fact that most IPTV subscribers over the next seven years will be high-speed Internet access subscribers already,” reports James Heath, director of broadband research at Dittberner, and the author of the just published report “IPTV Impact on Public Networks.”


Heath added that “IPTV’s subscriber base will not become significant for a decade and the incremental investment per subscriber will be low. Combined together, these provide a small boost to forecasted DSL, FTTH and router sales.”

The report analyzes the impact of offering IPTV on the access, aggregation and backbone networks. The forecast for the incremental increase in these market segments shows that the access equipment market will grow to $115,176,000; the aggregation equipment market will grow to $56,432,000; and the backbone equipment market will grow to $164,491,000 – for a total of $336,100,000.

The report concludes that the size of the access equipment market is greatly affected by the number of popular TV channels that are multi-cast to the DSLAM, while the backbone market will be greatly affected by the popularity of video-on-demand. Interestingly, the aggregation equipment market will remain relatively unaffected. The speed at which HDTV is introduced will directly affect the size of all three market segments.

Although subscription growth is expected to be slow, the incremental investment to offer IPTV is low, making it an attractive service offering for the traditional telephone companies. Dittberner believes that developing compelling service differentiation could speed up IPTV’s market penetration. The report lays out the case for IPTV as a service which will ultimately have a major impact on the design of public networks and the way service providers do business.

For more information about the report, or about Dittberner Associates, visit
www.Dittberner.com.

Patrick Barnard is Associate Editor for TMCnet and a columnist covering the telecom industry. To see more of his articles, please visit
Patrick Barnard’s columnist page.

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