Connected TV to break through in Germany

Around half of Germany's TV households will use internet offerings on the TV set by 2016.

The different market players are currently fiercely fighting for the central position in the living room including hardware manufacturers, portal operators and content providers, as German consultancy company Goldmedia reports in its study "Smart TV: Wer erringt die Portalhoheit auf dem Fernseher?" ("Smart TV: Who will gain portal control on the TV set?").

Technically, all home electronics manufacturers have upgraded their devices: A growing number of TV sets, set-top-boxes, Blu-ray players and games consoles can now be integrated into the local home network and thereby be connected to the internet. Consumers increasingly make use of this facet.

While around 4 million TV households had hooked up their TV set directly or through an external box to the internet at the end of 2010, the figure will rise to 5.6 million at the end of 2011, according to the Goldmedia prognosis. Until 2016 the number will grow by 31% per year on average to around 20 million.

Most households currently still access the internet world on the TV screen through the games console, but the number of consumers using a hybrid TV set for this purpose will grow more and more strongly.

In the service area, the smart TV market is still in an early development stage characterised by fragmentation of the offerings and a standardisation which commences only slowly. The providers include hardware manufacturers such as LG, Humax, Philips, Samsung or Sony which thereby move into the role of portal operators and aggregators of content and services.

This is also the case for cable operators and IPTV platform providers such Kabel Deutschland, Unitymedia, Deutsche Telekom and Vodafone. Also, terrestrial network operators and satellite operators such as Media Broadcast and Astra create portal offerings and want to exploit the market of internet content on the TV set for themselves.

Smart TV offers the biggest opportunities for content and service providers, according to the study. For example, advertising-financed video platforms such as YouTube or premium on-demand services such as LOVEFiLM, maxdome or Videoload will gain another attractive playout platform in addition to computers, smartphones and tablet-PCs.

TV broadcasters will also benefit as they will be able to offer their content in on-demand mode. With social TV and multiscreen solutions they will also gain plenty of new ways of usage. Other players in the smart TV market are large companies such as Google or Apple which target TV screens through their app stores Android Market or iTunes and new hardware devices.

For the consumer, the TV world of the future will become more diverse, but initially more confusing. "All important players of the value chain want to control consumers' access to the internet on the TV set," said the study's author Claus Sattler. "Content and services from which the smart TV portal providers get a  commission for usage are to be placed on the portal in a suitable way. But consumers don't want proprietary solutions and content restrictions. They want to be able to access the services they are interested in in an easy way. A flexible portal system adjustable by the user will probably gain most acceptance in the medium term."

The German-language study can be ordered free-of-charge on Goldmedia's website at http://www.goldmedia.com/publikationen/bestellung-smart-tv.html.

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