IPTV to be big but free

The total number of households subscribing to IPTV services is expected to grow tenfold over the next five years, according to research released Tuesday.

Strategy Analytics forecasts that the number of IPTV households worldwide will grow from 6 million homes in 2006 to more than 80 million in 2011.

But the analyst believes that many users will not be paying directly for TV programming or services, but will use IPTV “free of charge” as part of a package of bundled broadband services.

In fact, paid for IPTV services only account for around 50 per cent of the total at present and will continue to contribute a similar proportion through 2011.

The analyst predicts that the number of households worldwide paying for IPTV services will rise from 3.3 million in 2006 to 40.9 million in 2011.

“An intensely competitive consumer communications market is making deployment of new services, like IPTV, a critical objective for many service providers. But service structure and payment models used to deliver IPTV vary widely by region and service provider,” said Martin Olausson, senior analyst from the Strategy Analytics Digital Consumer Practice division.

“The traditional pay-TV definition breaks down in an environment in which multiple IP services (broadband, VoIP and IPTV) are paid for by a single fee, and in which a growing share of TV programming will not be paid for via subscriptions.”

The researcher expects that most telcos will offer customers a mix of free, subscription and pay as you go programming models.