There is a high chance that you have heard about IPTV before. In fact, you might even be using IPTV at this very moment without even knowing it. Also, you might be aware of how popular it is gaining and how quickly cable TV and satellite TV services are seeing a decline.
Smart IPTV services are indeed offering fantastic addition to the digital entertainment world.
But what is the future of IPTV? Is it here to stay for good and make the cable companies shift? Or the content providers will innovate something better to dethrone the internet protocol television services? Let’s look into the matter!
What Is IPTV?
Today’s world has seen a massive improvement in terms of broadcasting and streaming segments. Thanks to IPTV, content delivery and network infrastructure have seen a massive overhaul. But what exactly is IPTV? Well, IPTV stands for internet protocol television.
After reading the abbreviation, the thought of you watching content on your television through the internet might come into your head. If that is the case, you are on the right track. At its core, it means that the TV channels and other TV programs ben broadcasted, transmitted, or streamed through the internet protocol.
Service providers can start broadcasting the channels and video content in two different ways. Here is a brief overview of each digital television service:
Closed Network
The first one is a closed network, where the digital TV contents are not broadcasted through the general internet. Instead, the service provider would make the viewers get their content through a private internet protocol.
As the closed network does not rely on a public IP, the service provider gets more control over who receives data. Usually, these IPTV signals will have an IPTV subscriptions plan.
The subscribers who are only paying to the service providers will enjoy the channels or TV programs that the streaming network can offer. In other words, you can not access IPTV directly with mobile phones or smart TV, or other devices if you are not paying a subscription fee or become a subscriber of the service.
Many providers that are utilizing this network architecture will offer additional services such as video-on-demand (VOD). Some will also let the subscribers watch recorded TV shows (such as sports, news, or other live events), live IPTV, time-shifted TV service, near video-on-demand (VOD), and any more streaming options.
Open Network
On the other hand, we have an open network. Now, if you are wondering how an open IPTV works, it will basically rely on public internet protocol addresses. Many refer to it as over-the-top (OTT) streaming. OTT platforms will make the IPTV service provide television content or live TV services through the internet.
Users relying on these services will have the full freedom to watch the channels and video content that the provider offers without paying any money. However, the users will need to watch some ads in the video content or television program because that is how the IPTV company would make money and stay in the market.
What Is a Set-Top Box?
The thing about traditional TV services is that they will rely on coaxial cable, fiber optic cable, or other types of wires to make the television get the channels or contents. These cables can be pretty similar to what the telecom companies or a phone service company might use.
But IPTV does not work like that. It strictly relies on the internet. However, the capability of streaming for this hierarchical network system is only available on the television models that were recently launched in the market. The old TV that many users are still watching does not have any option to connect to the internet.
Well, that is where set-top boxes come into play. You can think of a set-top box like an adapter. It will decode the encoded signals that the service provider is sending through the internet connection and make your old TV, which was probably connected to a satellite TV service, stream the incoming content.
What Is the Future of IPTV?
Now that most of the basics of IPTV are out of the way, let us get into the main thing that brought you here. So, it is not a secret that the cable TV and satellite TV market is seeing a decline. And that is all because IPTV is seeing a rise in popularity.
For how popular IPTV is getting, industry experts say that the demand for satellite or other TV services might get to a point where they might have to exit the market entirely. In other words, the future of regular TV services is not looking good. But what about the IPTV’s future that the experts predict? Let us get into that now!
Current Condition of the IPTV Market
So, the market value of IPTV in 2020 was 72.24 billion USD. That means the IPTV market is already in a great overall position. Also, it states why the other TV services are making the shift to IPTV instead of sticking to the traditional broadcasting methods.
MordorIntelligence is seeing the fastest growth of IPTV in the market of Latin America. On the other hand, the most significant development is in the Asia Pacific.
The fact about IPTV having the largest impact in the Asia Pacific is quite interesting considering that the internet penetration is just at 57 percent. That percentage is pretty low in comparison.
However, the reason behind the driven growth might be because of the services not relying directly on set-top-boxes. Instead, they are more leaning forward to other consumption technology such as smartphones and tablets. More and more users are now becoming less bound to TVs and desktops when it comes to consuming content.
The Future of IPTV
Seeing the upward trend and the current condition of IPTV, experts can offer us insight into the IPTV’s future. In fact, there are loads of research data already present regarding the topic.
Among all of them, the one that made everyone truly understand the potential of IPTV snowballing in the market was the Grande View Research. The research stated that the IPTV is set to grow to a market size of 67.6 billion USD by the year 2027. They added that the compound annual growth rate would be at 7.1 percent.
Additionally, MordorIntelligence showed the people a more optimistic view regarding IPTV. They have stated that IPTV will gain a market value of 104.25 billion USD by the year 2025. And IPTV will have a CAGR value of 16.9 percent.
However, most of the growth will be from smartphone-centric internet users. In fact, different data has proved that by 2025, three-quarters of the world’s internet users will only access the internet through their smartphones. And by three quarters, you are looking at 3.7 billion users, which is not small in any comparison.
On that note, most smartphone-centric users will be from regions or countries with different infrastructures. And these infrastructures will not be totally cut out from the traditional IPTV set-top devices. Also, the biggest growth is expected to be from India, China, Pakistan, and Nigeria.
It is also worth mentioning that countries such as India and China are worthy of producing more and more content that is ripe for the delivery process of IPTV.
And seeing the trend and the current situation, it goes without saying that the IPTV’s future will be more optimized for being solely internet or mobile-based. So, we might see a decline in hardware-based services.
Will OTT See a Growth in Popularity?
Considering the fact that the hardware-related services will see a decline in the upcoming years, OTT services can see an uptrend in the future. OTT delivery of the older content has always had the benefit of not requiring any special hardware. They do not require any devices such as a set-top box.
As we have mentioned, the current world is becoming more mobile-centric. People do not find it convenient to consume content through television or desktops all the time. Instead, they are leaning forward to mobile devices. OTT can indeed leverage this and get a high overall growth in the future.
Furthermore, monetization of OTT service providers is surely possible. The easiest way is through embedded ads. However, that is not the only way! Many providers are offering premium OTT services, which require a subscription plan.
But that does not mean the other ways of content steaming will go away. There will always have a demand for live content.
Final Words
IPTV has come a long way. Since the early 1990s, when it was first introduced to the world, it has gone through many upgrades and permutations. The development rate has now skyrocketed. And if you are still wondering what is the future of IPTV, it is here to stay. It will also stay for a good time.