Picture To Brighten For DTV Sets And Set Top Boxes

2-May-00

Despite a slow start, good news is on the horizon for the US digital TV market, with shipments projected to increase to more than a half million units this year. By 2004, as DTV set prices decrease and the government-mandated cessation of analog transmissions nears, this figure will soar to 5.9 million units, resulting in $9 billion in revenue, reports Cahners In-Stat Group, a high-tech market research firm. HDTV displays will reign supreme for the next couple of years, and will eventually be overtaken by standard definition (SD) TV sets in 2003. According to Michelle Abraham, Senior Analyst for In-Stat's Consumer and Convergence Service, ""The large price differential between HDTV and SDTV will remain constant and the minimal variance in picture quality in sets below 30 inches will convince consumers replacing smaller screen sets to opt for SDTV. ""As a result, SDTV sets will lead the market in shipping volume by 2004, even though HDTV sets will generate more overall revenue."" Few HDTV sets are currently being sold with integrated decoders. Instead, consumers purchase separate decoder set top boxes which enable them to upgrade at a significantly lower cost than purchasing an entire HDTV set. Additionally, the use of digital terrestrial TV set top boxes (DTT-STBs) gives consumers digital television benefits without the purchase of pricey high definition sets. ""SDTV-STBs, specifically, can be used in conjunction with analog televisions, allowing the consumer to receive digital terrestrial transmission, increase their set's picture quality, and have access to multicast program services, electronic program guides and stereo or surround sound audio outputs,"" said Gerry Kaufold, Principal Analyst with In-Stat's Consumer and Convergence Service. So far, the high cost of digital sets has parlayed into $100 million dollars worth of retail sales worldwide for STBs. In-Stat predicts that these sales will explode to an estimated $1 billion in 2004. The European DVB-T market is breaking out of the chute first, In-Stat expects over 600,000 DTT-STBs to ship this year in England and Sweden. In-Stat also reports: - Strong DTV set and STB sales will generate significant revenue for the semiconductor industry. The worldwide market for semiconductors in DTT-STBs alone is expected to be $55.1 million in 2000, increasing to $379.4 million in 2004. - Integrated DTV sets are selling slowly in the UK due to the availability of a ""free"" DTT-STB. Consumers there are using this STB in conjunction with an analog widescreen TV set. Growth in the European market will depend on additional countries initiating digital terrestrial TV services. The report ""Digital Television Sets: The Forecast"" (MM0004DV) covers the current state of the digital TV market and provides forecasts for DTV set shipments and revenue in addition to resulting semiconductor content. The report also profiles DTV products for companies such as Hitachi, Fujitsu, Panasonic, Philips, Pioneer, Samsung, Sony, Sharp and Thomson/RCA. The report price is $2,495. The report ""Digital Terrestrial TV Set Top Boxes: Catching The New Digital Waves"" (MM0005ST) presents set top box features, transmission and reception issues in addition to set top box and semiconductor forecasts. The report price is $2,995. To purchase these reports or for more information, please visit http://www.instat.com/catalog/cat-mm.htm. Cahners In-Stat Group ( http://www.instat.com ) covers the full spectrum of digital communications research from vendor to end-user, providing the analysis and perspective that allows technology vendors and service providers worldwide to make more informed business decisions.

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