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ABI Research: mobile integration is key to success of smart STBs

Current Apple TV device (2nd gen)

Current Apple TV device (2nd gen)

Shipments of so-called ‘smart set-top boxes’ available on a  retail basis, such as the Apple TV and Roku devices, are expected to reach 57mn by 2017, but face a challenging future as they attempt to break out of their niche status, according to US firm ABI Research.

Apple TV is believed to lead this particular segment with around 4mn units shipped through 2011 (despite the late Steve Jobs describing the device as a “hobby”), while Roku managed to sell 2.5mn units in 2011.

However, the growing ability of other devices such as connected TVs, games consoles and Blu-ray players to stream online video to the television has created a very competitive market for the digital living room, according to the research firm.

“Google has a split personality in this market,” said Sam Rosen, practice director of TV & video at ABI Research. “On the one hand, China, in particular, is seeing growing interest in “generic” Android-based set-top boxes and USB (or MHL) dongles/stick devices.

“On the other hand, it is launching its second generation of Google TV platforms (including the well-priced and impressively spec’ed Vizio Co-Star) where it tries to bring more content relationships and a better ecosystem.”

Advantages of these smaller form factor USB and MHL devices include the fact that they are portable, and can offer consumers similar services and features found on popular mobile devices, according to the report.

Both of these devices can also expand the presence of Google Play, as well as effectively function as a companion device for Android-based mobile devices – not unlike the upcoming Nexus Q, just at a more appealing price point.

Senior analyst Michael Inouye comments: “Dedicated devices have traditionally had a difficult go in the market, often lacking the same value proposition as more full-featured products like game consoles. The changing consumer landscape, however, could present a window of opportunity for smart set-top boxes as more consumers allocate entertainment budget, both monetary and time, to streaming media.

“The future of connected CE will ultimately work together with mobile devices and not against them. Other CE devices like connected TVs and game consoles are already integrating mobile devices into the user experience, the same will likely prove true for smart set-top boxes as well. If the Android boxes gain popularity this could create a stronger ecosystem play for Google.”

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