According to research of the Taipei-based Market Intelligence & Consulting Institute (MIC) conducted as part of the ITIS project, the Taiwanese digital terrestrial STB (Set Top Box) industry reached a shipment volume of approximately 1.95 million units in the second half of 2008, up 36.7% compared to the same period in 2007, as the industry benefited from ATSC converter box demand in the United States.
US ATSC converter boxes are currently the main growth driver for digital terrestrial STB. DVB-T (Digital Video Broadcasting - Terrestrial) market demand in other regions is slowing down. In the first half of 2009, Taiwanese makers will still have shipment opportunities for the ATSC converter box as the US government has extended the schedule for the country's digital switchover. Shipment growth momentum in the second half of 2009, however, is expected to experience a significant slowdown.
In 2008 credit markets tightened due to the global financial crisis, and consumer confidence also declined. As a result, many consumer electronics products faced slowdowns in growth. Digital terrestrial STB, however, managed to maintain growth in 2008. The main reason for this was the US government's aggressive promotion of its digital TV switchover policy. In 2008-2009, the US government is offering consumers US$40 coupons to subsidize consumers' purchases of ATSC converter boxes. Originally, the goal was to complete the program on February 17, 2009. However, considering the fact that many analog TV users had not yet completed their digital switchover, the new US administration has decided to extend the program to June 2009.
According to FCC (Federal Communications Commission) regulations, after March 2007 all digital TV sets sold in the United States had to be equipped with built-in ATSC digital TV receiver function. Therefore, many of the major TV vendors, such as Samsung, Sony, LG, Sharp, and Philips, have rolled out iDTV products. Originally it was expected that iDTV would take a significant share of the market during the country's digital switchover, but due to the financial crisis, using digital terrestrial TV STB is a relatively cheaper option for consumers, affecting iDTV product procurements. The financial crisis has thus helped to increase STB sales. Considering the economic circumstances, value-line STB products priced at around US$50 are expected to be mainstream products.
Looking at the long-term development of the Taiwanese digital terrestrial STB industry, besides the US market, manufacturers will continue their efforts to develop new markets, such as Canada, Brazil, Mexico, Argentina, Russia, Ukraine, the United Kingdom, France etc. In particular, they focus on regions with large TV populations, low digital penetration rates, large surface areas, and scattered populations. In the long term, the digital terrestrial STB market still has room for growth. In the current economic climate, some countries are expected to resort to digital switchover promotion in order to stimulate the economy. Countries' specific policy development in this area will be a key factor in future development.
More information can be found in the following MIC report: The Taiwanese Digital Terrestrial STB Industry, 1Q 2009
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About MIC
Market Intelligence & Consulting Institute (MIC), based in Taipei, Taiwan, was founded in 1987. MIC is Taiwan's premier IT industry research and consulting firm providing intelligence, in-depth analysis, and strategic consulting services on global IT product and technology trends, focusing on markets and industries in Asia-Pacific. MIC is part of the Institute for Information Industry. https://mic.iii.org.tw/english
About ITIS
The ITIS (Industry and Technology Intelligence Services) project is managed by the Department of Industrial Technology of Taiwan's Ministry of Economic Affairs. As part of the project, research is conducted in a variety of fields, including the ICT sector. The project serves both the public and private sector.