Broadband-Enabled TVs Pave the Way for Over-the-Top Services

  • Online Video
  • Web-to-TV
DALLAS - By 2014, more than 360 million households worldwide will own devices that allow them to watch Internet video on TV - nearly triple today's number - and 170 million will watch over-the-top (OTT) Internet video on their TVs, according to new research fromĀ The Diffusion Group (TDG). The connected devices may beĀ televisions, games consoles, Blu-ray players, hybrid set-top boxes, Internet set-top boxes or media-centric PCs.

"A key reason many OTT efforts have failed - and will continue to do so - is their dependence on proprietary single-function hardware paid for by consumers," notes Colin Dixon, managing partner at TDG. "In order to grow a profitable base of service users, OTT operators must either give the hardware away for little to nothing - something upstarts cannot afford to do - or leverage other Internet-enabled platforms as a conduit to the living room. The latter approach is preferable, yet its success hinges on the rate at which these Internet-enabled platforms diffuse - a factor over which OTT providers have little control."

Dixon notes that companies such as Netflix and the BBC have had success embedding their service software in a variety of retail video platforms. As consumers replace their televisions over the next five years, and as manufacturers accelerate their shift to embedded solutions, the number of households with at least one Internet-enabled living room video platform will grow rapidly.

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