Pay TV Schism Over Set-top Box Future, Ownership Of Input 1

The market moves toward TV connected devices

In the new white paper Owning Input 1: The Future of the Pay TV Set-Top Box and Software makes it clear that the environment in which an operator set-top box (STB) exists within a consumer’s home has fundamentally changed. Just a few years ago, the only source for live video and broadcast content on television for most people was through their pay television STB. To a very real extent, the operator owned the experience of television for all its customers.

Those days are most certainly over. In the US today 64% of consumers have at least one subscription video on-demand (SVOD) service.  Though somewhat behind the US in penetration, Europe is heading in the same direction. 1 in 4 UK homes have a subscription to Netflix.

The preferred screen for viewing SVOD services is the television. Ericsson talked to consumers across 20 markets, and found that 75% of SVOD users used a television with access to the Internet, versus 47% of non-SVOD users. 23% used Google’s Chromecast, versus 10% of non-SVOD users.

Pay TV operators adapt

Operators are acutely aware of these shifts. The external reaction to these market movements includes: