China's IPTV market developing slowly but surely, says report

DECEMBER 20, 2006 -- China's IPTV market will go through a gradual but solid increase from 2006 to 2010, contends a new report from high-tech market research firm In-Stat.

The industry environment for IPTV has gotten better, but the outlook is still not completely positive. Two more IPTV licenses have been issued in China, and license holders have achieved some progress with more local telcos, say analysts. However, the government agency SARFT maintains tight control over content supervision and is using government policies to level the competition between IPTV and digital cable TV.

"China's IPTV ecosystem is still shaping itself," explains Rebecca Tan, In-Stat analyst. "The ecosystem participants, centralized around telcos, are trying to find an effective model for cooperation. Telcos currently have to rely on content providers for programming while trying to gain content licenses of their own," she reports, "while content providers, represented by Shanghai Media Group, are managing to control end-users through IPTV."

Also noted in the report:

? In-Stat projects that China's IPTV subscriber base will reach 6.3 million by 2010, up from only 240,000 in 2005.
? Annual subscription revenue will grow rapidly to $888 million by 2010.
? Telcos have conducted several trials in different areas around China and have begun the progress of IPTV commercialization in both Shanghai and Haerbin in the Heilongjiang Province.

In-stat's report, "China's IPTV market: Hot, but needs time to burn," analyzes the dynamics of China's IPTV ecosystem and provides an explanation of how critical policy and technology factors are influencing IPTV deployment around the country. It also puts specific emphasis on China's telecom carriers' up-to-date improvement on IPTV with regard to strategy, business model, service exploration, and network upgrading. Subscriber and revenue forecasts through 2010 are included. For more information about the report, visit www.in-stat.com.