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2013 to be a landmark year for 4K, says Deloitte

A large number of significant milestones will be passed in the development of Ultra High-Definition (Ultra HD, also known as 4K) television this year, according to London-based professional services firm Deloitte.

Although it may be 18-36 months before 4K is technically and commercially broadcast-ready, 2013 will be a banner year for the technology, despite many commentators still questioning the need for higher resolution pictures than those offered by 1080p.

Milestones for this year will include: the availability of around 20 Ultra HD television models from over ten vendors; delivery of the first compatible TV sets to consumers; a range of 4K content becoming available, along with more professional and semi-professional 4K cameras; new supporting standards agreed, including a new HDMI standard; and the commencement of multiple test broadcasts.

Demand for 4K is believed likely to grow over the medium-term, fuelled by rising expectations of higher resolutions across all screens, as well as larger TV sets and next-generation games consoles.

At least half of the 4K sets commercially available by the end of this year are predicted to cost less than US$ 10,000. Over subsequent years, the price of 4K TV sets is likely to drop steadily and significantly, in turn increasing the market for them.

Within five years if not before, it is likely that smaller (about 50 inch) 4K TV sets will sell for under US$ 1,000. The cost of manufacturing 50 inch 4K TV sets is expected to be significantly lower than 80 inch sets (about a third of the price).

4K TV set owners will need to rely on pre-recorded or streamed content in 2013 however, as no broadcast services are planned.  But there should be plenty of movies available to watch: many blockbusters from 2012 and 2011 were digitally captured in 4K.

In 2013, commercially available eight-layer Blu-ray discs, with 200 GB capacity (sufficient for a compressed 4K film) may also become available – almost ten years after the first eight-layer prototype was announced.

The study concedes that the upgrade to 4K entails “significant” capital expenditure for broadcasters, producers, television manufacturers, infrastructure owners and consumers, and is not a move to be taken lightly.

The cost for broadcasters of creating a 4K channel, factoring in upgrades to existing equipment and infrastructure, could be US$ 10mn to US$ 15mn, although these costs will decline in future. By comparison, an HD channel now costs about US$ 2mn to create, compared to the US$ 10mn it would have cost a decade ago.

Then there is the issue of bandwidth: Deloitte estimates that 4K could require up to 40 Mbps in 2013, although this may fall to 20 Mbps by the end of 2014, equivalent to the bandwidth requirements for the first standard HD transmissions in 2005, and the first 3D TV transmissions in 2010.

Satellite broadcasters are believed best placed to meet these bandwidth demands, and 4K test transmissions via satellite links are expected to occur in 2013. IPTV operators meanwhile will be more challenged, and are advised to consider 4K’s impact on the case for rolling out fibre-to-the-home (FTTH).

In addition to broadcasting costs, television operators will also need to factor in the expense of new customer premises equipment (CPE) such as set-top boxes that support the new HEVC compression standard, and which would need to include larger hard drives to cope with bigger file sizes – possible as large as 4 TB.

“Pixel parties” – where early adopters of the technology show it off to their family and friends, as was done in the early days of high-definition TV – are expected to prove a significant factor in promoting 4K, and catalyse further sales of compatible TV sets.

Deloitte has produced a video in which some of its top technology researchers discuss their predictions for 4K – available here.

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