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Motorola Leads in Digital Set-Top Boxes, Scientific-Atlanta Gaining
Feb 12, 2004
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According to recent data for the worldwide set-top box (STB) industry, Motorola remained the market leader with 38 percent of all shipments in 2003. Scientific-Atlanta, however, has been gaining momentum, and its market share is now at nearly 28 percent worldwide, according to market research firm ABI. Both Motorola and Scientific-Atlanta have a greater portion of the North American market, where they are less threatened by their more worldly rivals Pace, Pioneer, and Philips, ABI reports.

"The critical success factor for Scientific-Atlanta's strength in the set-top box market has been their strong showing in integrating DVR (digital video recording) functionality," stated Vamsi Sistla, director of Broadband Research at ABI and manager of the firm's Set-Top Box Quarterly Research Service.

Shipments by all vendors represented a 31-percent increase at year-end 2003 from the previous year. DVR functionality proved critical to market inroads in 2003, as cable MSOs -- still the primary distribution channel for STBs -- addressed the competitive threat from satellite vendors who were quicker to embrace DVR functionality, the research firm said.

In 2004, however, high-definition TV is poised to be the critical market factor, it added. Motorola announced deals for HD-capable STBs with Comcast last year, and most of the other vendors are making progress in the market.

But according to ABI, the long-term play here may not be a STB at all. "It is likely that STBs as we now think of them will cease to exist and be replaced by a new device," Mr. Sistla noted. "What will the new device be? Simply a standalone DVR? A DVD recorder with DVR functionality? Or a media gateway? This is the next big question."

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