Abstract
In 2006 Chinese IP STB shipments grew to 1.06 million units, compared with 458,000 units in 2005, with more than 20 companies now involved in this industry. IP STB makes use of network communications technology, and therefore companies with a background in network communications and expertise in IPTV technology, such as UTStarcom, ZTE and VCOM Electronic Technology, have become industry leaders. On the other hand, while vendors such as Coship Electronics and Haier Info-Tech lack IPTV total solutions, their focus on IP STB product development gives them an advantage over first-tier makers due to their broader product lines. This report analyzes the development strategies of the leading IP STB manufacturers in China.
Depending on their industry background the IP STB vendors in China each developed their own product positioning and market strategy. In terms of background, vendors with a background in network communications had more experience with developing markets and better customer relations. UTStarcom and ZTE both fit this definition and both chose to focus their IPTV strategy on China in 2005. The reason why Huawei has not captured a larger share of the Chinese IPTV market was due to its strategic decision making. As for the specialist IPTV vendor VCOM Electronic Technology, it not only began developing its IPTV strategy early but also targeted niche Chinese markets such as rural villages, with a particular emphasis on rural education projects.
As for Coship Electronics and Haier Info-Tech, though they released IP STB products relatively early and both offered a broader range of IP STB offerings than UTStarcom, ZTE and VCOM, their development has been hampered by their lack of total solutions. In the future, they might use their experience in STB manufacturing and production capacity to develop their OEM/ODM business. As for UTStarcom, ZTE and VCOM, their emphasis is on the development of IPTV system solutions. They do not devote all of their resources to the development and manufacturing of IP STB so there is room for collaboration -for example, between Coship Electronics and ZTE.
In terms of market strategy, vendors with a network communications background such as UTStarcom and ZTE have not only sought to establish their position in the Chinese market but also leveraged their advantage in international clientele and cost advantage over major international brands to open up new international markets. As for emerging vendors such as VCOM, their focus is on the developing Chinese market, particularly specific niche markets -an example being the rural market in the country.
Appendix
Research Scope
The subject of this research report is IP STB makers in China including UTStarcom, ZTE, VCOM Electronic Technology, Coship Electronics and Haier Info-Tech. This report analyzes these companies' background, scale, R&D, products, manufacturing and marketing operations.
Glossary of Terms
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STB |
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Set Top Box |
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CPU |
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Central Processing Unit |
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ADSL |
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Asymmetrical Digital Subscriber Loop |
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ARPU |
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Average Revenue Per User |
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DMA |
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Digital Media Adapter |
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IPTV |
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Internet Protocol Television |
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EPG |
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Electronic Program Guide |
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MPEG |
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Moving Pictures Experts Group |
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PVR |
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Personal Video Recorder |
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MAC |
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Media Access Control |
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PPV |
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Pay Per View |
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PPPoE |
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Point-to-Point Protocol over Ethernet |
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PSTN |
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Public Switched Telephone Network |
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VOD |
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Video On Demand |
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DVB |
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Digital Multimedia Broadcasting |
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IRD |
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Integrated Receive Decoder |
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WM9 |
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Windows Media Series9 |
List of Companies
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30kaitian Communication |
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三零凱天 |
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Beijing Haier Info-Tech |
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海爾信息 |
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China Netcom |
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中國網通 |
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China Telecom |
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中國電信 |
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Haier Group |
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海爾集團 |
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Henan CATV Telecom |
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河南中廣通 |
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Huawei |
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華為 |
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Langchao |
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浪潮 |
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Shenzhen Coship Electronics |
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同洲電子 |
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Tsinghua Tongfang |
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清華同方 |
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Zhengzhou VCOM Electronic Technology |
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威科姆科技 |
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ZTE |
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中興通訊 |