Google Chromecast to Drive OTT Set-Top Market

Google Chromecast to Drive OTT Set-Top Market

By Gabriel Miramar-Garcia for Rapid TV News

The smart set-top box and dongle market is expected to pass 18 million units in 2013 – higher than originally forecasted. According to ABI Research, the revision is due to the arrival of Google’s Chromecast device.

Overall, the market is expected to grow with a 10.8% [compound annual growth rate] (2013 to 2018), with less saturated markets along with those that are still developing from a connected and Over-The-Top perspective (like the Asia Pacific and Latin America) helping drive this growth.

“Despite stiff competition from a range of connected CE devices, the smart set-top box and dongle market offers an equally compelling user experience often at significantly lower price points,” said senior analyst Michael Inouye. “Google’s Chromecast device in particular sets a new low price bar for the connected CE market, and as more applications are added to its library its value to price ratio will continue to grow.”

The analyst expects more dongle form factors in the smart set-top box market; although the puck will remain highly relevant. The price of these devices will also allow lower tier TV manufacturers to separate the connected TV component, keeping prices lower and enabling customers the option to upgrade the connected platform as desired without replacing the TV or purchasing costly and proprietary upgrade modules, the firm noted.

The dongle path of course opens the door for new entrants as well: Sony and Intel are both planning to go this route.

“If Sony secures the rights to distribute live cable channels from Viacom, partnerships such as this allude to a content future quite different from the one many are accustomed to today,” practice director Sam Rosen said. “Content holders are already forging more direct relationships to viewers and this would be a natural step forward, but the pay-TV operators are likewise evolving and adapting to this changing market environment.”

As a result, the amalgamation of pay-TV and OTT will become increasingly important.