Digital Lifescapes

The Internet protocol television (IPTV) and switched digital video (SDV) equipment market increased 6 percent sequentially in 3Q08 to $1.4 billion, according to a market study by Infonetics Research. In its latest report, Infonetics lowered its long-term IPTV and SDV forecast due to an expected slowdown in IPTV subscriber growth and a decrease in cable operators moving to switched digital video. Annual overall growth will continue in the worldwide market through the downturn, but will grow in double-digit percentages rather than high triple-digit percentages, as it has in previous years. "We still see growth coming from the telco IPTV sector because IPTV is one of the key ways telcos can hold on to their broadband subscribers and increase revenue per user, so providers will continue to roll out new networks or expand their existing networks," said Jeff Heynen, directing analyst for broadband and video at Infonetics Research. Meanwhile, the cable switched digital video segment...

The mobile phone market will experience a significant downturn in shipments in 2009. According to IDC, total mobile phone volumes will be 1.9 percent lower in 2009 than 2008 levels, the first downturn in annual shipment volumes since 2001 -- when shipments declined 2.3 percent. Over the past several years, the mobile phone market has enjoyed double-digit annual growth due to an increased emphasis on emerging markets. However, emerging market growth has been steadily slowing as these markets mature. IDC now expects worldwide growth to be just 7.1 percent in 2008 before slipping into negative growth in 2009. In recent months, a number of major industry players -- including component suppliers, handset makers, and mobile service providers -- have announced their concerns about handset volumes in 2009. Most have indicated that they expect a year-over-year decrease due to the flagging global economy. "Nokia's announcement was the first sign of troubles to come," said Ryan Reit...

According to an Infonetics Research market study, the worldwide subscriber data management (SDM) software and integration services market will end 2008 up 21 percent, reaching $128 million. According to their report, updated recently to reflect changing global economic conditions, the SDM market is expected to surpass the original forecasts. "Although the global economic turmoil has operators lowering their capital expenditure (capex) budgets for 2009 and the initial part of 2010, our discussions with operators and subscriber data management vendors indicate spending on SDM solutions will actually increase," said Jeff Heynen, directing analyst at Infonetics Research and lead analyst on the report. SDM software is viewed as solving multiple pressing issues, including preventing dirty or duplicate data, reducing revenue leakage due to fraud, reducing operational costs, and speeding time to market for new services. All of these issues are critical as operators seek to improve th...

The total number of online video viewers will grow by more than two-thirds to 941 million in 2013, from 563 million in 2008, according to the latest market study by ABI Research. The 2013 estimate represents just over one-half of the 1.8 billion consumers expected to use the Internet that year. Although online video viewing is growing among all Internet users worldwide, viewing varies greatly from country to country. More than three-quarters of consumers in Australia, Germany, India, Japan, the UK and the U.S. market surveyed in Q3 2008 said they watched video on their PCs -- outpacing viewership for the world as a whole. Online video viewing has increased dramatically during 2008. In contrast, a look back at online video viewership in a wide range of countries from a study conducted in 2007 revealed relatively low usage. That study, by the USC Annenberg School Center for the Digital Future and the World Internet Project (WIP), was not made public until November 2008. It is surprising ...

The processor vendors supplying semiconductors for ultra-mobile devices (UMDs) are playing a pivotal role in how this market is shaping up. The family of X86-based processors are well entrenched in the PC world and ARM-based processors are well entrenched in the mobile handset world. Since UMDs sit right between the PCs and handsets in terms of power, size, and function, x86-based and ARM-based processors will compete in the UMD space -- and are already competing in vendor marketing battles. ABI Research principal analyst Philip Solis says, "x86-based processor vendors are in a very good position in the near term as far as product wins and market share are concerned. However, as mobile internet devices (MIDs) start to surpass netbooks in shipment volumes, ARM-based solutions will be in a better position." Processors based on the x86 architecture -- available from vendors such as Via Technologies and Intel -- hold a key advantage in that they are compatible with all x86-based ...

Based upon an expected 28 percent increase in 2008, the worldwide broadband service delivery platform (SDP) software and integration services market is forecast by Infonetics Research to top $3.5 billion in 2011. Mobile and fixed line service providers are deploying SDPs, or working with integrators to streamline how they create and deliver new services. The upside for innovation is significant -- for those Broadband Service Providers who dare to be different. Beyond transitioning existing OSS and BSS systems into Web services environments using XML, Java, and BPEL, service delivery platforms are being deployed to help integrate third-party services, especially on the mobile side. These include third-party services such as ringtones, SMS and MMS services, location-based services, mobile advertising, mobile TV services, rating and charging based on individual applications or subscriber parameters -- and social networking services from MySpace, Facebook, Bebo, Ning, etc. SDPs decrease ti...

According to Nielsen Online, 81 percent of online shoppers have read product or retailer reviews by other customers when doing their holiday shopping this year. Customer reviews are an important research tool for online consumers, with 71 percent agreeing that reviews influence their purchase. When evaluating this customer feedback, 63 percent of online shoppers indicated that it was important to have multiple reviews for each product; 14 percent looked for reviews from an established source; and just three percent sought out reviews by people they knew personally. These results are from a Nielsen Online holiday survey intended to understand the mindset of the U.S. online shopper. The online survey was fielded from December 8 -15 among approximately 1,000 online shoppers in the U.S. who did their shopping online last year and/or planned to do so this year. "Consumer reviews are a must-have for online retailers, especially during the holiday season when shoppers are buying for othe...

The Asia-Pacific (excluding Japan) IT services market is expected to remain healthy and grow to $49.4 billion in 2009 -- despite IDC's recent downward adjustment of the region's overall IT spending forecast. The optimistic outlook is driven primarily by continued demand for managed or hosted IT and network services, as cost management becomes a key focus for organizations in the region. In addition, the relatively stronger resistance to the global economic recession in the IT services market is being helped by continued double-digit growth in the developing markets of India and China -- as well as contribution from emerging countries such as the Philippines, Thailand, and Vietnam. According to IDC's latest poll conducted in October, more than 12 percent of 400 organizations surveyed indicated they would increase their spend on managed or hosted out-tasking services in 2009. Apparently, this is the only category in which there are double-digit percentages across the spectru...

While today's consumer is most likely to watch online video on their PC screen -- either desktop or portable -- over time more and more consumers will watch over-the-top (OTT) video delivered to the living room, according a new study from ABI Research. This continued trend towards TV-viewed online video will help drive overall adoption, as the number of online video viewers grows from 563 million at the end of 2008 to 941 million by 2013. "All stakeholders in the online video ecosystem are eyeing the living room," says research director Michael Wolf. With the continued adoption of network-connected video game consoles, the porting of popular online video services such as Hulu and Netflix onto third party consumer electronics devices, and network operator's growing interest in over-the-top video, the market for TV-displayed online video continuing to grow. The growth in viewing on both the PC and TV screen is due to the growth in all forms of content. While much of the...

The global mobile phone market revenues will top $1.03 trillion by 2013, when the number of subscriptions worldwide will have risen to more than 5.3 billion, according to a market study by Informa Telecoms & Media. From end-2007 to end-2013, the global mobile market will see huge growth, increasing in size by over half (56 percent). It took over 20 years to reach 3 billion subscriptions, but another 1.9 billion net additions are forecast in just six years, with the global total nudging past the 5-billion milestone in 2011. With this extraordinary growth, total annual revenues derived from mobile operators will grow by over a third (33.9 percent), jumping from $769 billion in 2007 to $1.03 trillion six years later. More than three quarters (78 percent) of global net additions between 2007 and 2013 to come from markets in Asia Pacific, Africa and Latin America, which will be the powerhouses of organic growth over the next five years. Nearly half (47 percent) of the 1.9 billion global...

Advertising spending began contracting in early 2008, well before the financial crisis unfolded in the fall. Among traditional media, television is predicted to fare better than newspapers, magazines and radio. National media will do better than local, but national ad growth has been exceptionally slow this year. Digital media is a truly disruptive force, across all traditional advertising segments. While no one can predict the length of the economic crisis or its severity, there is slim chance of any sort of recovery in 2009. eMarketer forecasts a decline of 4.2 percent in U.S. television ad spending in 2009. Similarly, Myers Publishing predicts ad spending for TV will decline by 4.0 percent next year. Barclays Capital has the gloomiest outlook, estimating TV advertising expenditures will drop an unprecedented 7.8 percent in 2009. Industry forecasters have continued to lower ad spending projections across the board for all U.S. media due to the ongoing slump in the advertising market....

There's still much to learn about the ongoing evolution of online video usage. As an example, Americans have embraced streaming video, often at the expense of video downloading. A market study by Ipsos found that 57 percent of U.S. Internet users 12 years of age and older have streamed video in the past 30 days -- 7 percent higher versus the end of 2007. In comparison, only 22 percent have downloaded video in the past 30 days. One commonly held belief for long-form video formats, such as movies and TV shows, is that they benefit the most from downloading -- since it allows consumers to save their downloaded videos, and have the ability to port these videos to other devices. However, it is clear that consumers are seeking other alternatives rather than paying the current prices associated with a movie or TV show download. In addition, many consumers may be reluctant to download large videos due to potential storage and portability issues on their PCs and portable devices. Apparently...

Consumers using social networks via their mobile phones today are mainly checking messages, status updates and comments of friends rather than posting photos or comments themselves, according to a market study by ABI Research. However, this usage pattern is changing as more consumers have access to better-equipped mobile phones and social network applications that allow for easy content uploading and communication. "Today more than 60 percent of those who access a social network on their phone do so mainly to check for messages or comments from friends, compared to less than 30 percent who upload photos," says research director Michael Wolf. Over time, however, a growing number of consumers will share photos and use social network messaging and email which will translate to longer and more frequent usage of social networks on their mobile. Today more than half of those who use a social network on their PC do so on a daily basis, while only approximately 17 percent of those ac...

The U.S. Home Video market is in the process of transformation, with its supply chain gearing up for change, according to a market study by Futuresource Consulting. "U.S. consumer demand for SD DVD and High Definition discs is projected to fall by a small amount this year," says Michael Boreham, Senior Consultant at Futuresource. "We're looking at a dip of just over 3 percent, resulting in retailers employing a more cautious approach to ordering stock, thus reducing surplus inventory and freeing up capital and shelf space." Although this is piling on the pressure across the supply chain and increasing the frequency of deliveries, longer term it is hoped that improved forecasting and smaller, more regular shipments will result in fewer returns, which will equate to considerable cost reductions elsewhere in the chain. In order to minimize lost sales, retailers are trying to balance maintaining existing tolerances on out-of-stock titles against higher inventory cos...

As the economic crisis continues to evolve, demand for personal computers is expected to slow quickly. IDC expects worldwide PC shipments to grow just 3.8 percent in 2009 with shipment value falling by 5.3 percent. This is considerably slower than second quarter projections of 13.7 percent growth in units and 4.5 percent in shipment value. The outlook for full year 2008 and 2010 have each been lowered a couple percent to 12.4 percent and 10.9 percent, respectively, with growth above 12 percent for 2011 and 2012. Emerging markets in Latin America, Central Europe, the Middle East and Africa are among the most significantly affected in the short term. Falling commodity prices, a rising dollar, and restricted credit have had a dramatic affect on consumer and distribution channel financing. These regions had been among the fastest growing markets over the past several years as falling prices helped new users acquire systems. Now Latin America and Central/Eastern Europe are expecting volume ...

Although cellular handset accessories such as chargers and batteries ship far more units in what is a $58 billion industry today, memory cards provide the greatest revenue of all mobile phone add-ons, according to a market study by ABI Research. Driven by the photo, audio and video demands of media-centric handsets and smartphones, these memory cards, largely from third-party suppliers such as SanDisk, will see a 17 percent compound annual growth rate in shipments over the years to 2013. However, says industry analyst Michael Morgan, "it's not just about units shipped." Of all accessories, memory cards deliver the best revenue return. In fact, as production has outstripped demand the market is currently oversupplied, leading to a 60 percent year-over-year fall in per-Megabyte prices. However, the capacity of the memory cards being sold is always increasing, and the resulting higher Megabyte volumes more than offset the decline in ASP. Handset makers have been putting inex...

The global recession will be a major factor behind every trend and development in the information technology (IT) and telecommunications markets in 2009. However, IDC predicts that the financial pressures felt by IT vendors and their customers will actually accelerate the industry transformation. "A slow global economy will act like a pressure cooker on the IT market, speeding the development and adoption of new technologies and business models," said Frank Gens, senior vice president and chief analyst at IDC. The reason why this will happen is simple -- the benefits offered by these disruptive offerings and models will be magnified. Suppliers and customers will migrate toward new solutions not because they are about the future, but because they offer practical benefits today. A deep global recession and a radical industry transformation are at the core of IDC's predictions for the IT industry in 2009. With economists forecasting dramatically slowing global GDP growth, ID...

Near Field Communication (NFC) was the leading contender among technologies that could enable U.S. mobile payments, like it already has in leading global mobile communication markets. But, NFC has developed more slowly in America than anticipated, and will not offer viable large-scale mobile payment solutions for at least six years. In the mean time three existing technologies -- SMS, mobile Internet and downloadable mobile applications -- have the potential to deliver what NFC cannot. "About half of all purchases made by consumers last year were made with cash," notes ABI Research senior analyst Mark Beccue. "Consumers would in many cases prefer cashless transactions when away from home." So around the world solutions providers have leveraged SMS, mobile Internet and downloadable mobile applications to enable mobile commerce and payments. ABI Research calculates the potential revenue in 2013 from mobile transactions using these methods at about $18 billion -- a sig...

There's more bad news about the economy every day, and falling advertising spending is part of the mix. Although online advertising is still on a positive growth curve, that growth is slowing and will dip into the single digits for the first time in 2009. eMarketer’s revised projection, benchmarked against the latest Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC) data, puts online ad spending at $25.7 billion in 2009. That is only 8.9 percent over the $23.6 billion that will be spent in 2008. In August, before the full impact of the economic slowdown was revealed, eMarketer predicted online advert spending would grow 14.5 percent in 2009. Not only is the new projection lower, but recovery is expected to take longer. In 2010, online ad spending growth will return -- but only barely -- into the double digits at 10.9 percent, and in 2013 it will only hit 13.5 percent. Even paid search, which has grown at an outsize pace for years, will see a mere 21.4 percent r...

ABI Research conducted an online survey among 1001 tech-savvy U.S. consumers concerning their behavior and attitudes towards the Internet, mobile phones and television. Four distinct groups emerged from the survey's attitudinal and behavioral segmentation: Tech-Savvy/TV-Averse, Online/On-A-Budget, Wireless Women on Web and On-the-Go Gadgeteers. The findings of this revealing study are contained in a free white paper which can be downloaded from the firm’s website. "The segmentation that emerged from this study is extremely interesting, and we're hoping to use it in the future to understand these tech-savvy group's attitudes and behaviors towards purchasing new technology products and services," says ABI Research Primary Research Director, Janet Wise. ABI's market study uncovered the following: - Only 8 percent of the Tech-Savvy/TV-Averse respondents agreed that TV is an important information source. Their behavior supports this mind-set since fewer members of ...

The United Kingdom is the first European nation to adopt digital video recorders (DVRs) in significant numbers. Over 35 percent of U.K. broadband households own a DVR, according to a market study by Parks Associates. Their five-country study examined entertainment trends across Europe and found over one-third of U.K. broadband households own a DVR. British households are also more likely than other European DVR households to record programs and skip commercials. At the same time, DVR use has not completely replaced use of broadcast TV. Even young U.K. consumers with a DVR continue to watch broadcast TV more often than recorded programs, part of the overall trend in Europe where households are less receptive than their American counterparts to television services. "If Americans are wedded to their TVs, Europeans are just dating," said John Barrett, director of research, Parks Associates. He pointed out that while U.K. adoption rates are strong by European standards, they still...

According to Portio Research, worldwide mobile messaging is a $130 billion industry in 2008, and their forecasts show that value rising to reach $224 billion by the end of 2013. SMS still totally dominates the mobile messaging mix. Their report describes where messaging services reside within the total mobile service revenues. Portio forecasts that even in 2013, messaging will still account for approximately 60 percent of all non-voice service revenues worldwide, and within that SMS text messages will account for some 55 percent of all messaging revenues. With mobile data revenues expected to account for between 25 and 30 percent of total mobile operator service revenues worldwide by 2013, that means that messaging will account for approximately 17 percent of total operator service revenues by 2013. SMS text messaging will be responsible for approximately 9 percent of total operator service revenues in 2013. Across the planet, everywhere from The Philippines to Croatia, SMS is booming,...

The femtocell has the potential to improve indoor cellular coverage. But an older technology, the picocell, has existed for about a decade. Picocells provide larger coverage and capacity than femtocells, which should make them well suited to small and medium businesses. Yet global shipments of picocells will total only about 18,000 this year. Why haven't picocells gained greater market share, and what can vendors do about it? According to ABI Research senior analyst Aditya Kaul, "One major reason for picocell's low penetration has been their high total cost of ownership. Picocells are mostly operated and maintained by mobile operators, and every installation and service call costs them money. Many operators underestimated these costs when they initially opted for picocells." The market has also focused on femtocells, with their minimal ownership costs. Mobile phone operators have avoided picocells because they've been waiting for femtocells to be thoroughly tested...

Demand for high-definition television (HDTV), which includes demand for both HDTV sets and programming, has been increasing steadily for several years according to the latest market study by In-Stat. For TV set manufacturers and pay-TV service providers, this spike in demand has been a bright spot in an otherwise troubled market. However, there is still one aspect of the HDTV ecosystem that remains problematic, especially for pay-TV service providers. The HD gap refers to households that have an installed HDTV set, but are not using it to watch HD programming. Historically, this gap has been the most visible in the U.S. market. For example, in late 2006, only 40 percent of American households with an installed HDTV set were using it to watch HD programming. A recent survey of U.S. households by In-Stat offers both good and bad news about the HD gap. The good news is that the gap had narrowed significantly over the past two years. Based on a survey of over 1,100 households with an insta...

As more video content is available online, broadband service providers are increasingly investing in Video on Demand (VoD) and time-shifting services. This trend towards time-shifted television viewing has helped produce a shift from schedule-based TV broadcasting to on-demand distribution. Time-shifting has created a new opportunity for operators to acquire and retain new customers, and has enabled several applications such as catch up TV, pause live TV, and network personal video recording (nPVR) capabilities. "VOD and server-based time shifting are attractive services for consumers and give carriers a cost-effective weapon in combating the new offerings consumers find outside of traditional pay-TV services," says ABI Research director Michael Wolf. "This overall push for greater consumer control over viewing through time-shifted and on-demand content will have a direct impact on the success of those selling video servers and related infrastructure." Time-shifted ...

According to a market study by TDG, game consoles such as Microsoft's Xbox 360 and Sony's PS3 are evolving into multimedia gateways with various non-gaming media applications. Armed with the growing video libraries of Xbox LIVE and the Playstation Network, these consoles can deliver on-demand video services with content similar to local cable, satellite or telco Pay-TV operators. Though similar efforts have failed -- largely because they relied on consumers to buy yet another set-top box -- the business model and the timing seem to favor the game console-based approach. "There is a bit of a value vacuum developing around today's Pay-TV offerings," noted Colin Dixon, TDG's practice manager for broadband media and report co-author. Rising dissatisfaction with service value, the lack of flexibility implicit in tiered strategies, and a growing interest in watching online video on the TV have combined to create a unique opportunity for alternative video services. M...

More than half of American consumers with Internet access use social networking services (SNS), such as Facebook and MySpace, and penetration will continue to grow. Great advertising opportunity, right? Think again. According to IDC, consumers are also spending ever-greater amounts of time on social networks, a fact that has advertisers drooling over the opportunity represented by SNS. But, there's more to this story. IDC found that consumers who use SNS also tend to visit the services often and spend a lot of time per visit. More than three quarters of SNS users visit at least once a week, and no less than 57 percent visit at least once a day. During each session, 61 percent of SNS users spend at least 30 minutes on the respective site or stay logged in permanently, and 38 percent spend at least one full hour per session. There are four major reasons why consumers use SNS -- to connect and communicate; in response to peer-pressure; for entertainment; and for work-related purposes....

Given the recent news about the economy, one could not be blamed for approaching this holiday season with a very short shopping list. But a recent survey of 1600 households conducted by ABI Research has shown that not all consumers intend to cut back on spending, and some are even thinking of spending more than last year. "ABI Research is anticipating that that all consumer electronics manufacturers and retailers are right to expect difficult times ahead," says research director Michael Wolf. "But we also believe that there are certain segments that will fare better than others, including digital TVs and video game software." While 47 percent of respondents plan to decrease spending during the 2008 end-of-year holidays, a surprising 40 percent expect to spend about the same as usual, and 13 percent -- mostly younger consumers -- actually foresee a spending increase. Wolf continues, "One surprising result was that 18 percent indicated that they were planning on ...

After posting the largest single increase on record in the second quarter of 2008 ($360 million), the worldwide cable modem termination system (CMTS) market dropped 32 percent in 3Q08 to $246 million, according to Infonetics Research. While the third quarter is typically the slowest quarter for spending on cable broadband aggregation equipment, Infonetics says it was made worse this year by the decision of some cable operators to slow down their purchasing in advance of deteriorating economic conditions worldwide. Downward price pressure also affected the quarter, reducing overall revenue-per-port. With housing starts down and consumers digging in for what appears to be a long recession, major operators are beginning to slow their rollouts of CMTS and universal edge QAM (UEQ) ports. "Although Comcast, Time Warner, Cablevision, and other major North American operators are still moving forward with their DOCSIS 3.0 rollouts, they are doing so with less fervor, as it remains to be se...

Video delivered over the Internet is a truly disruptive force. As cable providers improve their PC video offerings, satellite and telco operators increasingly see over-the-top broadband video delivery as a viable option. During the past year, both DirecTV and DISH Network have rolled out over-the-top Video on Demand (VoD) on Internet-connected set-top boxes, while telcos in Europe have been combining digital terrestrial linear TV broadcasts with broadband video for VoD. ABI Research believes that as broadband video offerings increase in quality and become more seamless, carriers could be significant players in the over-the-top video delivery market. "Carrier-packaged over-the-top video delivery is a reality today in most markets," says research director Michael Wolf of ABI Research. The fact is, broadband video is a way for some carriers to fill holes relative to larger closed-network operators such as cable MSOs, and over time more satellite, telco and European terrestrial o...