According to new research, the smart set-top box and dongle market is projected to pass 18 million units this year, which was higher than original forecast, due to the arrival of Google’s Chromecast device.
ABI Research’s study said that the overall market was expected to have a 10.8 percent compound annual growth rate (CAGR) from this year to 2018. That increased growth rate will be helped along by regions, such as Asia-Pacific and Latin America, where over-the-top services are currently less saturated.
Last month Google started selling the Chromecast device, which is about the size of a thumb drive and plugs directly into the HDMI port of an HDTV, for $35.
“Despite stiff competition from a range of connected CE devices, the smart set-top box and dongle market offers an equally compelling user experience often at significantly lower price points,” senior analyst Michael Inouye said. “Google’s Chromecast device in particular sets a new low price bar for the connected CE market and as more applications are added to its library its value to price ratio will continue to grow.”
In time, as the installed base of devices with new technologies grow, consumers will start to see more dongle form factors in the smart set-top box market, according to the report. The price of the new devices will also allow lower tier TV manufacturers to separate the connected TV component, keeping prices lower and enabling customers the option to upgrade the connected platform as desired without replacing the TV or purchasing costly and proprietary upgrade modules.
“If Sony secures the rights to distribute live cable channels from Viacom, partnerships such as this allude to a content future quite different from the one many are accustomed to today,” said practice director Sam Rosen. “Content holders are already forging more direct relationships to viewers and this would be a natural step forward, but the pay TV operators are likewise evolving and adapting to this changing market environment.
“The amalgamation of pay TV and OTT will become increasingly important, suggesting Google TV’s vision might have come too early but might grow into this role as a bridge or new entrants like Microsoft’s Xbox One might fully realize this unified vision.”
