Consider what is going through the minds of cable and telco executives as look at the following statistics:
iSuppli says the shipments of IPTV set-top boxes (STBs) worldwide will rise by 48.2 percent this year over last, and reach 28.7 million (from 19.4 million). That is not an isolated spike: Device shipments will rise at a 25 percent compound annual growth rate from 2009 through 2014. The firm says IPTV boxes represented 14.7 percent of the units shipped last year. That portion will rise to 29.1 percent in 2014. Meanwhile, traditional cable, satellite and "terrestrial" STBs will rise only 6.7 percent this year over last.
The trend is no less impressive when individual regions are highlighted.
Parks Associates reports that U.S. homes that used broadband to watch "premium content"-which is generally considered to be HBO, Showtime and similar pay channels-reached more than 25 million last year. More than 20 million watched movies in this manner.
In China, the number of IPTV subscribers at the end of last year was 63.4 percent greater than at the end of 2008. The raw numbers-4.33 million versus 2.65 million-illustrates just how great the increase was. The number of IPTV subscribers will reach 8.5 million people by the end of the year, according to ResearchInChina.
While it didn't offer specific numbers on the use of IPTV in Canada, Ipsos Reid suggests that it is increasing there as well. Average weekly Internet use by individuals overall, the story says, rose from 14.9 hours to more than 18 hours. Part of that increase is due to folks watching television on their computing devices, the story says:
Some industry watchers have noted the cost of watching TV is rising as cable TV companies and satellite operators raise the monthly cost of service. As that happens more people are watching TV online for free.
This is fun. All these numbers and percentages tell a consistent story: A big chunk of the way in which most folks kick back and relax suddenly is up for grabs. The cable folks, of course, consider this audience their birthright. The telcos used video revenue as one of the key rationales for the billions of dollars they poured into Verizon's FiOS, AT&T's U-verse and other projects. Now, that status quo is endangered by upstarts such as YouTube, DailyMotion and Hulu.
How this will evolve still is unclear. Commentary in Parks Associates' release suggests that the jury still is out on whether the lion's share of people will favor "over the top" providers or maintain a formalized arrangements from telcos and cable operators, perhaps through services such as Comcast's TV Everywhere.
The net neutrality debate also will have an impact. The inability of the FCC to enforce net neutrality rules-a potential outcome of the decision earlier this month by The U.S. Court of Appeals for the District of Columbia Circuit-could enable cable operators and telcos to favor their programming initiatives over the Vudus and Hulus of the world.
Conversely, successful institution of net neutrality would mean that networks owned by Comcast, Verizon and the other carriers would be available to their fullest extent to tenant websites. This would reduce these big carriers to wholesale suppliers of dumb pipes.