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Equipment Vendor Forecast for IPTV Windfall

There are many challenges to overcome before IPTV goes mainstream, says a new report from Infonetics Research. Many of those obstacles are expected to be overcome for the worldwide IPTV subscriber base to more than double every year from 2005 to 2009, to reach the forecast of 68.9 million total subscribers.

However, even if the subscriber growth estimates are proven unreachable, equipment vendors will still benefit from a windfall. Infonetics' report forecasts IPTV service provider capex to increase dramatically, with sales of IPTV equipment to skyrocket -- from $371 million to $6.8 billion -- between 2005 and 2009.

The evolving IPTV business case scenario is beginning to follow the 3G wireless network build-out model -- where a typical service provider's huge infrastructure investment has preceded a coherent and plausible market development plan.

Report highlights include:

- Service providers are expected to generate significant IPTV service revenue between 2005 and 2009, with worldwide revenue increasing at a 169 percent five-year compound annual growth rate.

- The bulk of IPTV service revenue is being generated by providers in Europe.

- Service providers are dedicating rapidly increasing amounts of their capital expenditure dollars to IPTV infrastructure, including both content and transport equipment, with worldwide IPTV capex growing at a 41 percent CAGR between 2005 and 2009.

- The number of IPTV subscribers in Asia Pacific more than tripled between 2004 and 2005, where faster forms of DSL like VDSL2 and ADSL2/2+ are stimulating subscriber growth.

- The number of IP set top boxes (STBs) sold worldwide will nearly triple between 2006 and 2007, led by China-based Yuxing InfoTech and UK-based Amino Communications, who are currently the worldwide leaders in IP STB unit shipment market share.

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