Light Reading

Make Way for Gateways

Alan Breznick
11/12/2013
50%
50%

Although they may still be relatively small in number, home media gateways are starting to make their presence felt in the pay TV market.

In two separate reports, analyst firms Multimedia Research Group (MRG) Inc. and Infonetics Research Inc. confirmed the growing industry interest in media gateways, which are centralized über boxes that can support multiple video and broadband services in the home. Both reports found that providers are seeking to deploy more gateways in response to consumer demand for more advanced video and home networking services, especially multi-screen video.

MRG, a unit of SNL Kagan , predicts that global shipments of home media gateway products will reach nearly 10 million units this year, up from 7.7 million units in 2012. As a result, it sees vendor revenues climbing to almost $3 billion this year, up from $2.3 billion last year.

Even so, MRG noted that gateway shipments will still account for just 4 percent of all set-top box shipments this year. However, the firm expects demand for the gateways to "increase significantly over the next few years."

With a hefty average sales price of about $300 per box, gateways should be a lucrative source of income for set-top makers. But that relatively steep price will also limit their penetration to high-income regions around the world, at least initially, MRG said. Specifically, the firm expects that "virtually all" gateway deployments "will be confined" to North America and Europe through 2015.

So far, "headed" gateways, which attach directly to TV sets, easily make up the lion's share of product shipments. MRG projected that "headless" gateways, which are more advanced boxes that don't hook up to TVs, will account for only 2 percent of all global gateway shipments in 2013. But many industry experts believe that headless gateways will overtake headed gateways down the line.

In its report, Infonetics projects that home networking devices, which it describes a bit more broadly as gateways and set-tops that integrate wireless and wired technologies to distribute video signals throughout the home, will generate substantially more revenue this year. The firm reported that global vendor revenue from home networking devices climbed to $5.4 billion in the first half of the year, up 6 percent from the second half of 2012. Devices using multimedia-over-coax (MoCA) technology, which ship primarily in North America, drove most of the growth.

Zeroing in on broadband data gateways, Infonetics found that residential gateway revenues rose 7 percent in the first half of the year on a sequential basis. The firm said such gateways, which combine the functions of modems and routers, "continue to cannibalize retail routers," depressing router shipments and revenues.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
albreznick
50%
50%
albreznick,
User Rank: Blogger
11/14/2013 | 5:42:54 PM
Re: Costly, but...
That's true. It may be good value for what you get. But $300 is still a pretty stiff price to pay for a new video-related box in the home, no matter how souped-up it is. So there's no question that gateways will have appeal. The big question is whether they will be big mainstream products or just higher-end niche ones. The jury's still out on that.  
Phil_Britt
50%
50%
Phil_Britt,
User Rank: Light Sabre
11/13/2013 | 12:27:26 PM
Costly, but...
You're right that $300 per box is costly, at leaston the surface. However, if one has already opted for video streaming and other data-intensive services, the $300 may seem to be little to pay if the box optimizes data needs for mutiple device users.

Late in the afternoon, the commuting college student and high school student could be home, each on a device or two like an iPhone and laptop (multiply by number of children on data-intensive devices), while a parent or two might be one or more of their own devices. Add to that a VOIP phone, and all of a sudden, one is more than happy to pay not to have mutiple devices freeze up or slow down to the point that they are unusable during periods of high demand.
Carol Wilson
50%
50%
Carol Wilson,
User Rank: Blogger
11/12/2013 | 2:34:53 PM
Virtual gateways
As this equipment gets more high function and thus more high cost, I'm wondering if service providers won't look for virtualized options - home broadband is one of the scenarios currently under discussion. 
Flash Poll
From The Founder
Network architects aiming to upgrade their networks to support agile, open, virtualized services in the 21st century need to consider new criteria when choosing between technology suppliers.
Live Streaming Video
BTE 2015 Sponsor Keynote: HP
Dr. Prodip Sen, CTO, Network Functions Virtualization, HP
LRTV Custom TV
Red Hat Demo

7|2|15   |   10:53   |   (0) comments


Red Hat's Nicolas Lemieux demonstrates how Red Hat is driving innovation through open source communities.
LRTV Custom TV
Red Hat's Approach to OpenStack Adoption

7|2|15   |   5:17   |   (0) comments


Red Hat's Radhesh Balakrishnan outlines his company's open source strategy for both enterprises and telcos.
LRTV Custom TV
The New IP Goes Mobile With vEPC

7|2|15   |   1:12   |   (0) comments


Heavy Reading's Gabriel Brown discusses results of a Light Reading survey sponsored by Brocade that shows a clear commitment by mobile operators to move quickly to virtual EPC deployment.
LRTV Custom TV
Making Business Sense of SDN

7|2|15   |   1:42   |   (0) comments


Results of a Brocade-sponsored survey show that CSPs have a clear sense of SDN use cases but are wrestling with the business case. Sterling Perrin of Heavy Reading looks behind the numbers.
LRTV Custom TV
NFV Will Be Here Sooner Than You Think

7|2|15   |   2:22   |   (0) comments


Forget the usual ten-year cycle for new technologies – NFV will be a core part of CSP networks in five years, based on results of a Brocade-sponsored survey, says Heavy Reading's Caroline Chappell.
LRTV Custom TV
The New IP Gains Traction With CSPs

7|2|15   |   1:42   |   (0) comments


Roz Roseboro of Heavy Reading analyzes results of a Light Reading survey sponsored by Brocade showing that CSPs are getting serious about making the transition to the New IP era.
LRTV Custom TV
It's (Real) Time for Analytics

7|2|15   |   1:42   |   (0) comments


Heavy Reading's Jim Hodges looks at how CSPs say they plan to use analytics to deploy new services in real time as part of The New IP, based on results of a survey sponsored by Brocade.
LRTV Documentaries
IoT in Action

6|30|15   |   1:39   |   (7) comments


Two co-workers discuss the benefits of IoT technology.
LRTV Interviews
Ericsson Opens Up on OPNFV

6|30|15   |   14:16   |   (1) comment


Martin Bäckström, VP and head of industry area Datacom at Ericsson, talks to Light Reading founder and CEO Steve Saunders about the emergence of OPNFV, the importance of standards and Ericsson's OPNFV plans.
LRTV Custom TV
NetNumber Founder Discusses NFV/SDN Impact on SP Networks

6|26|15   |   4:15   |   (0) comments


NetNumber Founder Doug Ranalli examines why SPs need a new network infrastructure for service agility. While NFV and SDN are the tools, the old ways of thinking about signaling control are inhibitors. Doug provides his recommendations.
LRTV Custom TV
Orchestrating NFV vCPE Services Across Multivendor Networks

6|26|15   |   5:46   |   (0) comments


Nirav Modi provides an overview of vCPE, the fastest-growing NFV use case, showing how Cyan's Blue Planet orchestrates vCPE services across a multivendor infrastructure to rapidly deliver new managed services for business customers.
LRTV Custom TV
ZTE at LTE Summit Amsterdam 2015

6|26|15   |     |   (0) comments


As one of the leading global telecommunications providers, ZTE presented its cutting-edge technology at LTE World Summit 2015 in Amsterdam. On display at ZTE's booth were the latest R&D achievements in wireless, 5G development, HetNet, deep convergence of FDD and TDD, and RCS/IMD/iSDN/vCN.
Upcoming Live Events
September 16-17, 2015, The Westin Galleria Dallas, Dallas, TX
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
October 6, 2015, The Westin Peachtree Plaza, Atlanta, GA
October 6, 2015, Westin Peachtree Plaza, Atlanta, GA
October 14-15, 2015, New Orleans Ernest N. Morial Convention Center, New Orleans, LA
November 5, 2015, Hilton Santa Clara, Santa Clara, CA
All Upcoming Live Events
Infographics
Hot Topics
Who's Feeding Fiber to LinkNYC Hotspots?
Mari Silbey, Senior Editor, Cable/Video, 6/29/2015
Colt to Jettison Ailing IT Business
Iain Morris, News Editor, 6/30/2015
Eurobites: Activist Investor Takes Stake in AlcaLu
Paul Rainford, Assistant Editor, Europe, 6/30/2015
What's a Gigabit Good For?
Carol Wilson, Editor-at-large, 7/1/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Casa Systems has been going from strength to strength over the last couple of years. In 2013, it became the first vendor to ship an integrated CCAP device -- the ...
Cedrik Neike, SVP of Global Service Provider, Service Delivery, at Cisco, talks to Light Reading founder and CEO Steve Saunders about solving service provider customer problems in a virtualized, DevOps world, including multivendor support and the future of network procurement.
Cats with Phones