The smart TV market has been forecast to increase at a compound annual growth rate (CAGR) of 17% through to 2016, reaching a market value of $265 billion. Unit shipments have been forecast to increase at a CAGR of 19%, rising from 64 million in 2011, to hit 223 million units by 2018.
Smart TV generally refers to service concepts involving the transmission of video content to a TV set via internet. Like a smart phone, a smart TV offers a number of "Internet-connected services" that normal televisions cannot offer. It has the equivalent of a computer built into it, giving a greater number of services.
These new devices most often also have a much higher focus on online interactive media, Internet TV, over-the-top content, as well as on-demand streaming media, and less focus on traditional broadcast media like previous generations of television sets and set-top boxes always have had.
The technology that enables smart TVs is not only incorporated into television sets, but also devices such as set-top boxes, Blu-ray players, game consoles, hotel television systems, and other companion devices. These devices allow viewers to search and find videos, movies, photos and other content on the Web, on a local cable TV channel, on a satellite TV channel, or on a local storage drive.
Currently, approximately 12 million US households have their Web-capable TVs connected to the Internet, although it is estimated about 25 million US TV households own a set with the built-in network capability. Furthermore, it has been forecast that 100 million homes in North America and Western Europe will own television sets that blend traditional programs with Internet content by 2016.
There have been several controversies surrounding the smart TV market and its on-demand Internet streaming media in general, especially in the United States. Cable providers as well as content providers have been slow to warm to smart TV platforms and devices, and some broadcast networks even been accused of using broadcast syndication against smart TV platforms.
For example, Boxee supported NBC Universal's Hulu quite early on, but in February 2009 was asked by Hulu to remove the service at the request of Hulu's content partners. Boxee later reinstated the feature using Hulu's RSS feeds, but Hulu once again blocked access.
Growth in the smart TV market over the next few years will be primarily driven by developing sectors, given the fast improving broadband connectivity, growing consumer affluence especially in emerging markets such as India and China, and the subsequent rise in demand for quality content over the best TV sets available in the market.
For more information on the smart TV market, see the latest research: Smart TV Market
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