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Consumer Demand for Advanced Functionalities Drives Set Top Box Semiconductors Markets

17 February 2007

The global set top box market has been experiencing significant growth, largely due to the emergence of Internet Protocol television (IPTV) and the growing popularity of high definition television (HDTV). With consumers demanding increased control over the TV viewing experience, there has been a continuous rise in the use of set top box technology across the world.

New analysis from Frost & Sullivan (http://www.frost.com), World Set Top Box Semiconductors Markets, reveals that this market earned revenues of $1.77 billion in 2006 and estimates it to reach $4.23 billion in 2010.

If you are interested in a virtual brochure, which provides manufacturers, end users, and other industry participants with an overview of the latest analysis of World Set Top Box Semiconductors Markets, then send an e-mail to Tori Foster, Corporate Communications, at tori.foster@frost.com with your full name, company name, title, telephone number, fax number, and e-mail address. Upon receipt of the above information, an overview will be sent to you by e- mail.

"The introduction of IPTV functionalities such as digital video recording (DVR) presents a great opportunity for the growth of the set top box market," says Frost & Sullivan Research Analyst Natarajan Krishnamurthy. "In addition, growing penetration of HDTVs into the consumer electronics market has created a strong need for set top boxes to deliver better-quality video."

Original equipment manufacturers (OEMs) of set top boxes are introducing various interactive functions such as video-on-demand (VOD) and personal video recorders (PVRs) in response to customer demand for higher interactivity and greater control. These new functions are changing the architectural behavior of digital cable set top boxes. User-friendly middleware also enables consumers to control set top boxes according to their needs.

However, OEMs need to ensure that set top boxes have the appropriate functionality to meet the advanced requirements of HDTV and DVR. OEMs should remain constantly updated on advancements in technology in order to retain their competitive edge in the market.

"The key challenge in set top box technology is to meet the Motion Pictures Expert Group (MPEG)-4 HD requirements," says Krishnamurthy. "Since MPEG-4 HD is expected to have more functionality, OEMs should consider transitioning set top box technology from MPEG-2 to MPEG-4, particularly since compression coding techniques are increasingly moving toward providing better- quality video."

With penetration levels of set top box technology in residential gateways having reached the desired levels, OEMs also need to focus on implementing this technology in new and different applications such as VOD, PVRs and home networking. Implementation in these applications requires the integration of silicon and middleware, as this will help OEMs to be more competitive.

"As an increasing number of additional functions are incorporated in set top boxes, the requirement for silicon tuners is on the rise," says Krishnamurthy. "There is a need for compact and cost-effective silicon tuners to enable additional functions such as picture-in-picture and PVRs."

Silicon chip tuners available today possess the ability to receive both analog and digital video channels, which could help make set top boxes compact. Moreover, silicon tuners offer various advantages such as fewer integrated components, less power consumption and low heat dissipation.

World Set Top Box Semiconductors Markets, part of the Semiconductors Subscription (AESR-26), provides in-depth forecasts of the market and analysis of its major drivers, restraints, and industry challenges. In this research service, Frost & Sullivan's expert analysts thoroughly examine the following: cable set top boxes, direct broadcast satellite set top boxes, digital subscriber line set top boxes, terrestrial set top boxes, set top box tuners, demodulators, and MPEG decoders. Interviews with the press are available.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective, and combines ongoing analysis of markets, technologies, econometrics, and demographics. For more information, visit http://www.frost.com.

World Set Top Box Semiconductors Markets

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Contact:

Tori Foster

Corporate Communications - North America

P: +1.210.477.8448

F: +1.210.348.1003

E: tori.foster@frost.com

Michael Banks

Corporate Communications - Europe

P: +44 (0)20 7915 7876

F: +44 (0)20 7730 3343