DTV will be slow to ramp on the consumer side. They need to build out the infrastructure first...................................
Despite Digital TV's Enormous Long Term Potential, IDC Forecasts Prolonged and Arduous Transition -- Even With First Digital Broadcasts on November 1
10:27 a.m. Oct 27, 1998 Eastern
FRAMINGHAM, Mass., Oct. 27 /PRNewswire/ -- International Data Corporation -- the world's leading provider of IT market research, analysis and consulting -- predicts mass market acceptance of Digital TV is years away, despite 42 U.S. TV stations transmitting the first digital broadcasts on November 1. Consumer confusion, incomplete infrastructure, hardware costs, and technical questions will prevent Digital TV -- particularly High Definition Television (HDTV) -- from growing as quickly as many have predicted, according to a comprehensive Digital TV study conducted by IDC.
In an agreement broadcasters struck with Congress in 1996 to gain rights to additional airwaves, Digital TV is being mandated by law. In fact, the transition from analog to digital looms as broadcasters in the top 10 U.S. markets must begin digital broadcasting by next May with many starting next week. Stations in the top 30 markets must start by next November, and the rest of the stations by 2003.
"Similar to the evolution of the Internet, a tremendous amount of infrastructure building and behind the scenes work must be done before Digital TV and HDTV can build meaningful momentum among consumers," said Kevin Hause, a senior analyst in IDC's Consumer Devices research service. "The industry must also invest in consumer education and awareness to prime the pump for long term demand."
Digital TV to Boom by 2007
From an expected market of a few thousand units in 1998, IDC forecasts that the installed base of HDTV sets and compatible converter boxes will expand to over 13 million units by the end of 2002, then explode to 138 million units by the end of 2007. IDC states the Digital TV market will provide tremendous opportunities for media, technology, and content industries. "As the digital services are constructed, content grows, and hardware costs decline, consumer momentum will accelerate, further feeding growth and creating a snowball effect," said Hause.
In the near term, a large installed base of analog TVs, concern over supported digital formats, and near term set costs will keep true HDTV set volumes low. However, lower cost Standard Definition TV (SDTV) sets and set top converter boxes will provide users with more affordable options. While not displaying HDTV in all its glory, these lower cost alternatives will enable users to receive digital signals and in most cases yield improvements over analog. IDC believes these products will be a key enabler of the digital transition and will represent the majority of shipments during the forecast period.
This report, Review & Forecast of the U.S. Digital Television Market 1997 - 2002, provides comprehensive analysis and forecasting of the U.S. market for digital television. It includes objective analysis of Digital Cable Television, HDTV, Digital Broadcast Satellite, C-Band, Satellite Master Antenna Television (SMATV), and Wireless Cable. The scope of the report is the U.S. market where digital television is becoming competitive. Analysis of consumer trends comes from IDC surveys, and detail is provided on service and hardware product offerings from service providers and suppliers. Subscriber and set shipment forecasts are included through 2002 with key forecast data points to 2007. This report is available for purchase by contacting Janis Dempsey at 508-935-4145 or at jdempsey@idc.com. For additional information about IDC's Consumer Devices program, contact Beth Freedman at 508-935-4764 or at bfreedman@idc.com.
About IDC
International Data Corporation is the information technology industry's most comprehensive resource on worldwide IT markets, trends, products, vendors, and geographies. IDC provides data, analysis and advisory services to the world's leading IT suppliers as well as IS professionals in finance, insurance, entertainment, advertising, consumer goods and publishing. IDC's research and opinions are based on the results of more than 300,000 end-user surveys, in-depth competitive analysis, broad technology coverage, and strategic analysis. IDC is committed to providing global research with local content through its 500 analysts in more than 40 countries worldwide. Additional information on IDC can be found on its Web site at idc.com.
IDC is a division of International Data Group, the world's leading IT media, research, and exposition company.
All product and company names may be trademarks or registered trademarks of their respective holders. SOURCE International Data Corporation
Copyright 1998, PR Newswire
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