According to research from The Diffusion Group (TDG), by 2014 more than 360 million households worldwide will own the components necessary to enjoy Over-the-Top (OTT) video services on their TV, with more than half actively receiving OTT services. This and other themes are discussed in TDG's latest digital media analysis, Broadband-Enabled TV: Evolution of OTT Hardware Platforms
“A key reason why many OTT efforts have failed (and will continue to do so) is their dependence on proprietary single-function hardware paid for by consumers.” notes Colin Dixon, managing partner at TDG. “In order to grow a profitable base of service users, OTT operators must either give the hardware away for little to nothingâ€”something upstarts cannot afford to doâ€”or leverage other Internet-enabled platforms as a conduit to the living room. The latter approach is preferable yet its success hinges on the rate at which these Internet-enabled platforms diffuseâ€“ a factor over which OTT providers have little control.”
Dixon notes that a number of companies including Netflix and the BBC have been embedding their service software in a variety of retail video platforms and are enjoying early success. As normal replacement cycles unfold over the next five years, and as manufacturers accelerate their shift to embedded solutions, the number of households with at least one Internet-enabled living room video platform will grow (and rapidly so).