Internet Connected TVs To Hit 596 Million By 2017

Google TV Devices
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The new generation of televisions combine traditional programming with online media and capabilities.

Research shows the U.S. will contribute 147 million web-connected TVs to the total, 25 per cent of the global total.

LONDON – The number of TV connections to the Internet will hit 596 million by 2017, up from 105 million at end-2010 and the 212 million expected at end-2012, according to fresh research.

The report, published Wednesday by Digital TV Research, covers 40 territories and notes the U.S. contributed 48 million to the 2010 total or 45 percent of the global total, and is expected to grow to 78 million in 2012, or 37 percent and 147 million by 2017, repping only 25 percent of the global total.

According to the research, China will have 93 million connected TVs by 2017, up from just two million at end-2010.

China's growth will push Japan, currently in second place in 2010 with 13 million to third spot in 2017 with 43 million predicted.

This global connected TV total translates to 21.4 percent of global TV sets by 2017, up from only 4.7 percent at end-2010 and 8.9 percent by end-2012.

The U.S. will have the highest penetration of TV sets by 2017 – at 38.1 percent, closely followed by Norway (37.7 percent) and South Korea (37.2 percent).

Report author Simon Murray said: "There has been something of a backlash against smart TV sets over the last year as critics argue that similar – or even better – offers are available on tablets or even mobile smartphones. Critics complain that connected TV sets provide a clunky experience. Although this is a wake-up call for those involved in the sector, these deficiencies are likely to be addressed reasonably soon as connected TV becomes mainstream. Unsurprisingly, the bulk of online usage via connected TVs is TV-related."

There are several ways by which a TV set can be connected online.

The most popular has been via the fixed games console, which accounted for 57 percent of the 2010 total, Murray's report notes.

But connected TV sets will overtake games consoles in late 2012. Connected TV sets will account for 41 percent of the 2017 total. There were 31 million installed connected TV sets by end-2010, and this total will leap to 84 million by end-2012 and onto 243 million by 2017.

Connected TV via the pay TV set-top box has plenty of potential as operators strive to retain their subscribers.

TiVo has signed deals with several pay TV operators and with Liberty Global/UPC launching its Horizon gateway service across several of its European properties in late 2012, that will grow.

The report estimates that there will be 98 million sets accessing the Internet via the pay TV set-top box by end-2017.

But only 3.5 percent of global TV sets will be connected this way in 2017.

As well as pay TV operators offering connected set-top boxes, some models are available at retail.

Examples include Google TV, Apple TV and Roku.

Largely a U.S. phenomenon at present there have been several international launches in 2012.

The global total of connected TV sets via retail set-top boxes will reach 40.2 million in 2017, up from only 3.0 million in 2010 and 13.6 million by end-2012.

This form of connection is only expected to have a limited impact (1.4 percent of global TV sets by 2017) due to the superior offers from the other forms of connections.

Despite being overtaken by connected sets in late 2012, the number of connected games consoles will continue to rise significantly (reaching 138.4 million by 2017, up from 82.2 million at end-2012).

The total number of fixed games consoles will increase by 79 percent between 2010 and 2017 to 276 million, according to the report.

This growth comes due to the anticipated launches of new versions of each console between 2012 and 2014.

Blu-ray players will also become important for connected TV expansion, with 76.1 million connections forecast by 2017.

The U.S. is tipped to lead the charge, maintaining its market lead with 16.6 million connected TV via blu-ray players by 2017.

China will be close behind with 12.7 million connected blu-ray players by 2017, up from 140,000 at end-2010 and 1.6 million at end-2012.