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Smart TV Growth is Driving Open Access to Content

Connected TV adoption is now accelerating across the globe, and the upside opportunities for Smart TV app development will follow this trend. According to the latest market study by NPD DisplaySearch, over one-quarter of TVs shipped during the first quarter (Q1) 2012 were equipped with broadband internet connectivity.

Approximately 27 percent of TV sets shipped worldwide had internet connectivity -- led by Japan, where 46 percent of sets had broadband networking capability built-in, and Western Europe with 36 percent.

A good example of how online video entertainment has already evolved is to observe the results in emerging markets. China has followed closely behind Western Europe -- with 32 percent of the TV sets that shipped now have internet functionality.

NPD DisplaySearch has analyzed TV sets by service type -- which further demonstrates that this trend is a global phenomenon. Basic connected TVs can access structured services from broadcasters such as Hbb.TV in Europe, BBC's iPlayer in the UK, Hulu in the U.S. and AcTVila in Japan.

According to their assessment, a smart TV can access a branded portal and service, not just publicly available platforms such as YouTube, or television broadcaster services. Within this definition of a smart TV, there are sub-categories that differ in the nature of the control of the service offering.

Consumer electronics (CE) manufacturer-controlled TV sets can have unique services from a portal. No two brands are alike, and the services may be configurable as approved TV apps. In contrast, consumer-controlled sets can escape the constraints of a portal and allow the consumer to have open access to the whole internet. These TV sets typically have an internet web browser built-in.

Smart TV Penetration, Q1’12 Shipments


"Connected TV is largely driven by content," said Paul Gray, Director of TV Electronics Research at NPD DisplaySearch. "Where there are compelling things to watch, the internet becomes a major source of entertainment. We are now seeing a second stage of evolution as internet video relocates from a PC screen onto the TV screen. In particular, Chinese consumers have found plenty to watch on the internet, so internet connectivity follows."

One of the more surprising findings from their market study is that no region is being left behind. Developed regions of the world can be expected to have high shipments, and areas with low broadband uptake such as the Middle East and Africa also show a strong interest in internet connectivity.

"It is an interesting trend," added Gray. "There are countries in emerging regions where mobile broadband far outnumbers fixed lines, so consumers are looking to share mobile content on a big screen."

By region, the largest shipments were in China with almost 3.0 million smart TVs shipped. Western Europe was second, with 2.1 million units shipped, while North America was third with almost 1.4 million units shipped.

By region, open internet access to video content is dominant in China -- as consumers have a shortage of structured services (approved apps) and want to look elsewhere for content to view. However, 2012 models from all major brands now incorporate web browsers, and this feature trend is likely to proliferate outside of China.

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