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Telcos Aiding Internet-TV Market

Telephone companies are installing more Internet TV, driving higher demand for set-top boxes that the support the service.

Telephone companies are installing more Internet TV, driving higher demand for set-top boxes that the support the service, a research firm said Monday.

As a result, shipments of Internet protocol/ DSL boxes are expected to grow to 16.9 million in 2009 from 1.7 million in 2004, In-Stat said. By the end of the forecast, IP/DSL boxes are expected to surpass digital cable boxes.

Nevertheless, the research firm expects a shakeout over the next few years among manufacturers.

"There are over 80 vendors offering IP/DSL set top boxes today," In-Stat analyst Michelle Abraham said in a statement. "That's too many vendors for a market of this size. Only about 25 of them have telco customers."

In other findings in the recent In-Stat study, the average selling price of the IP/DSL boxes was highest in the North America, due to the demand for a digital video recorder, high-definition playback and multi-room capabilities. And the greatest technology shift in IP/DSL boxes is the move to advanced vide compression, which requires more memory and more powerful video decoders than the current MPEG-2 standard.

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