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Upside/Downside of Media Place-shifting

As more consumers use products such as the Slingbox to get "anywhere access" to their premium and personal digital content, so-called "placeshifting" technologies may face opposition from wireless carriers, according to a new study from ABI Research.

The ability to stream pay TV from a set-top box and digital content from a home PC over the Internet to a variety of devices has the potential to disrupt new content services being delivered by mobile operators who do not differentiate their offering.

"New digital distribution technologies typically meet the stiffest resistance from content owners such as movie studios," says principal analyst Michael Wolf. "With placeshifting, we believe the biggest opponents will be mobile operators who see these solutions as rogue network applications that could potentially paralyze their cellular networks, as well as keeping consumers from paying for mobile video offerings being offered over new mobile video networks."

Despite this potential resistance, ABI Research sees a bright future for placeshifting as consumer awareness of hardware, software, and embedded solutions grows. While today's placeshifting market is largely hardware-based, as adopters use the Slingbox or Sony's LF-PK1, a growing number of consumers will also adopt software solutions such as that from Orb Networks and SageTV, or embedded solutions such as placeshifting enabled set-top boxes.

"As the overall placeshifting market grows from less than $22 million in 2005 to nearly $740 million by 2011, much of the growth will come as placeshifting technology moves into existing devices," said Wolf. "Hardware vendors such as Sling and Sony, while still seeing strong growth from device sales, will work with other system OEMs to integrate placeshifting into both server and client devices. ABI Research believes that mobile clients will see some of the strongest adoption of placeshifting capabilities, as smart phones and Wi-Fi-enabled mobile media players integrate the technology to enable streaming of live TV and digital music."

While some carriers will resist placeshifting, others may see it as a way to capture additional ARPU. Video service providers may also see placeshifting as an additional service revenue opportunity, in much the same way that they charge for PVR services today, while some wireless carriers may support placeshifting as a way to sell more high-end data plans.

From a consumer's perspective, placshifting will ensure that they don't have to pay for the same digital content more than once, even if they choose to move that content to another device. Enabling the 'pay once - play anywhere' model will positively enhance digital media consumption.

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