China's broadband business is facing the problem of ARPU descending. IPTV carries the responsibility as a killer application, which is the hope of telecom operators.
In the later half of 2000, many companies almost simultaneously announced their latest broadband solutions for IPTV. Operators who deploy IPTV mainly centralized in Europe, America, and some countries and regions in Asian-Pacific. By the end of 2004, the two operators with the most IPTV subscribers are FastWeb in Italy and Hong Kong-based PCCW.
Though Chinese administrative apartments are relatively conservative about integrating the three networks, however, the trend is strong. Once breakthroughs are made, IPTV will be developed quickly.
IPTV development environment in China is much different from other countries
In China, IPTV is in the initiation stage. The awareness level is relatively low. Concept introductions, finalization of technology and market cultivation are all needed. This situation will continue to 2006. From year 2007, as users gradually get matured, applications are increasingly enriched and market promotion ceaselessly strengthened, IPTV is likely to grow fast.
IPTV industry chain is shaping
The IPTV industry chain includes equipment suppliers, system integrators, broadband network operators, contents providers, traditional contents providers, value-added contents providers, chip sets and other technology providers, terminal manufacturers, etc. The various links in the IPTV chain come from different industries such as IT, Telecoms and entertainment. Pday Research has been dedicated to research these industries for long, and has accumulated much related information concerning enterprises in the IPTV chain. This report reveals key enterprises in the IPTV chain and addresses their competition status.
China's IPTV digital STB industry started from difficulties. There are more than a dozen of manufacturers that have dabbled in STB production, among which there are not only professional STB makers rising from IT industry but also conventional color TV makers such as TCL and Konka. Meanwhile, semiconductor enterprises both at home and abroad have sped up their market promotion. Overseas manufacturers wish to strengthen their advantages on their existing market base, while domestic makers are gradually entering a stage of batch supply and even large-scale market exploration. The pricing of IP STBs is in a trend of diversification, in which there are high-end products of over 3000RMB that can be comparable with a PC as well as those popular and practical products of below 600RMB.
At present, TV sets possession in China is over 300 million, among which 3.6 million are high-end TV sets, providing a solid user base for the development of IPTV. The owners of the 3.6m TV sets are major target customers of IPTV in the initial stage. Both ADSL and Cable access can basically satisfy the minimum bandwidth requirements of IPTV. IPTV equipments providers have been offered with the environment of various manufacturers, and some of whose IPTV solutions have been applied overseas. Therefore, there is a great potential in China's IPTV market, which offers excellent investment opportunities for hardware makers, operators and contents providers.
China's IPTV industry is still in the investment stage. There will be no big profits in the next one or two years. However, this period is also an important stage for all players to seize a portion of the market and shape the brands.
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