IPTV service revenues will approach $14 billion in 2012, growing from $694 million in 2007, according to “US IPTV Forecast and Outlook,” a report just released by Strategy Analytics. Although there are numerous IPTV providers of all shapes and sizes in the US, the landscape is largely dominated by the two incumbents: AT&T and Verizon, each of which has a different approach in terms of technology and investment.

“2007 was a watershed year for IPTV in the US market,” said Ben Piper, Director of the Strategy Analytics Broadband Network Strategies service. “The two major US players reached critical mass in terms of subscriptions. The onus is now on service providers to quantify and articulate the benefits of IPTV against ‘traditional’ Pay TV media, such as cable and satellite.”

ARPU is expected to remain relatively stable throughout the forecast period, and service growth will come largely from an increased number of IPTV-passed homes, and higher take-up rates.

“Our models suggest that IPTV will make impressive headway in the next several years, both in terms of overall homes passed and service revenues,” said David Mercer, Vice-President of the Strategy Analytics Digital Consumer Practice. “Service providers have only a limited number ‘levers’ to pull, and should try to think holistically in terms of an overall customer experience.”

In addition to providing an outlook of the current United States IPTV market, this report forecasts homes passed, homes connected and service revenues in the market through 2012. In addition, it identifies key imperatives for service providers to compete effectively in a highly penetrated Pay-TV environment.