With consumers growing ever more demanding in terms of accessing content, the job for the traditional set-top box manufacturer has become much tougher. As content providers and distributors look to provide services over IP as well as satellite and cable, manufacturers face more pressure than ever to deliver next-generation units that can ingest media in all formats and serve as the centerpiece of the household viewing and media consumption experience.
With Blu-ray players as well as games consoles offering access to content on the Internet, the role of the set-top box in the household of the future is very much up for discussion. However, set-top box manufacturers are not reacting to the changes; they are trying to stay ahead of the curve. The day of old-fashioned, one-dimensional set-top box is coming to an end, with more complex, media-type gateway boxes beginning to take their place.
Even the term set-top box is outdated, says Neil Gaydon, CEO of Pace. “We need a new term to replace set-top box, which reflects the complexity of advanced devices. It is used to refer to everything from a very basic-type box all the way through to HD PVR with broadband controlling the whole home in an IP network. That is not a set-top box; it is a media gateway. The managed device products we produce for the likes of DirecTV, Sky Italia, Foxtel and Canal+ are very advanced products, and we need to rethink the terminology to reflect its complexity and scope,” he says. The role of the set-top box is beginning to change as satellite pay-TV operators begin to blend different technologies to bring different content from different sources to households. “We supply products for a managed service that not only provides numerous downloads but also delivers content that is either exclusive to the operator or is aggregated content which fits the demand of the mass market. The mixture of broadcast TV with a broadband link for on-demand services is gaining momentum. Whether via a Wi-Fi link or Ethernet cable to the set-top box, it is a powerful service that allows video on demand whilst being able to watch high-quality pictures coming down from the satellite in 3-D or HD. We will see the power of the set-top box get much stronger and evolve from a hybrid-type box doing broadcast and broadband into a media gateway which creates an IP network in the home connected to your Ethernet-linked TV, games console and other digital services,” he says.
Vince Pizzica, senior executive vice president, strategy technology and research, Technicolor, says the set-top box market is “in transition. … What was considered to be a pretty vanilla set-top box market has to now support lots of different ways to put content into the living room. What you have to do is think, ‘What is a set-top box in reality?’ It is a piece of hardware with some software on it. The software does certain functions. What we are seeing is that some of the functions of that software are being distributed to different boxes in the home, but the overall functionality and the things that are needed to be done by the set-top box, such as: ‘What are the rights of this user to view this content?’ ‘How do I render that content onto a TV screen?’ ‘How do I manage that video stream in a secure way?’ All those things need to happen. What we see is a repackaging of set-top box functionality. We see this as an opportunity, as we have some great software as well as some great hardware, so it is an opportunity for us to bring more software into more devices.”
Michelle Abraham, a media analyst at In-Stat, says a lot of “experimentation” is taking place from pay-TV operators as they try and gain an edge on their rivals. “We’re seeing a lot of experimentation with over-the-top (OTT) video coming to the TV via the set-top box as well as TV anywhere services. Pay-TV operators also want to offer subscribers the ability to customize their service via downloadable applications. All require more flexible set-top boxes than what has been used in the past.” Abraham believes the spread of home networking technologies is the most exciting transition taking place. “The ability to receive OTT video and the integration of home networking technologies like MoCA, HPNA, and powerline (are the most exciting things we are seeing right now). Wi-Fi will spread slowly as well,” she says.