Worldwide shipments of pay-TV hybrid set-top boxes are expected to grow to nearly 87 million units by 2015, as operators adapt to increasing competition within markets with varying infrastructure and regulatory demands. According to the IMS Research report The World Market for Hybrid Set-top Boxes – 2010 Edition, by 2015 hybrid STBs will comprise the majority of STB shipments worldwide.

Much of the strong growth in the next five years will be driven by pay-TV operators in Asia and Europe. Thanks to heavy satellite and cable shipments of advanced HD DVRs, the Americas region led with over 65% of global hybrid STB shipments in 2009, however IMS expects that the two other regions will surpass the Americas within a couple of years. Growth in Asia is expected to be heavily driven by hybrid deployments in China late in the period, and European growth is expected to come most significantly from France, Germany, Turkey, UK, the Netherlands, and others with sizeable pay-TV markets.

The pay-TV market is steadily shifting towards hybrid STBs due to demand and to some extent by default, notes Paul Erickson, Senior Analyst at IMS Research. “As major pay-TV operators worldwide become more competitive with content offerings and advanced services, hybrid STBs become increasingly attractive as a way to utilize means other than an operator’s traditional infrastructure to deliver the most competitive experience possible. Additionally, virtually all advanced STBs shipping worldwide are expected to be hybrid by default within a few years.”

“The shift of the pay-TV set-top box market towards hybrid STBs is notable for two main reasons. First, the near-ubiquitous inclusion of IP connectivity in current and future hybrid STBs enables continued innovation in the pay-TV experience. The IP-connected service enhancements of the future promise to bring substantially more to the viewing experience than today’s features like VOD, DVR, and media sharing. Second, the broader effects benefit both pay-TV operators and their customers. Hybrid STBs potentially allow operators to maximize the level of services they are able to competitively deliver within their market, despite limitations within their own infrastructure, regulatory issues, or content retransmission rights. As such, pay-TV customers will directly benefit in the long run as pay-TV services deliver ever-increasing amounts of content, interactivity, and innovative IP-driven applications into their living room.”