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IPTV a $44B Market by 2009

IPTV equipment and service revenue is expected to hit $44 billion over the next three years, according to a new report by Infonetics Research.

The research firm said worldwide IPTV subscribers will climb to 53 million by 2009. To meet that demand, service providers are rapidly increasing their investments in infrastructure, transport and content.

Europe, the Middle East and Asia is the leading region for IPTV service revenue. Subscribers in the Asia-Pacific region, where faster forms of DSL such as VDSL2 are stimulating subscriber growth, almost doubled from 2004 to 2005.

The report further states that IPTV subscribers in North America will increase four-fold between 2005 and 2009.

By 2009, Infonetics expects IPTV equipment revenue will be $6 billion and service revenue will climb to $38 billion. Worldwide IPTV equipment revenue topped $400 million in 2005.

"Service providers expect huge returns from IPTV, and they are investing heavily in IPTV infrastructure to ensure those returns," Jeff Heynen, an Infonetics analyst, said in a statement.

Currently, broadband providers with DSL and Fiber-to-the-Home (FTTH) services account for the majority of service revenue.

"Right now they're focused on transport infrastructure, upgrading their access networks with higher-bandwidth ADSL2+, VDSL2 and FTTH platforms, and adding IP edge routers and Ethernet routers and switches to handle the expected traffic demands of the escalating numbers of IPTV subscribers," Heynen said.

According to the report, IP set top box (STB) revenue currently accounts for 42 percent of IPTV equipment revenue as providers purchase MPEG-2 STBs. Infonetics predicts IP STB sales will nearly double every year for the next three years.

Infonetics also expects cable broadband providers to migrate to all IP-based services in the next few years.