Monday, August 26, 2013: According to the Research and Markets analyst predictions, the market for Set-Top Box (STB) is supposed to grow at a CAGR of 26 per cent during the years 2012-16. The reason behind the possible growth is the mandatory digitalisation requirement of Telecom Regulatory Authority of India (TRAI).
Moreover, there has been an increase in the number of government regulations that are beneficial for domestic vendors. But, fierce competition among vendors can challenge the growth of the market.
The market is dominated by vendors such as Cisco Systems Inc., Huawei Technologies Co. Ltd., Pace plc, and Sichuan Changhong Electric Co. Ltd.
According to an analyst, if the import duty of STBs rise by five-six per cent then new domestic players will enter the market. The digitalisation by the end of 2014 will result in more demand for STB. Hence, domestic vendors will be able to fulfill the demand by supplying STBs that are produced in the domestic market.
Taking the advantage of economies of scale, the vendors can enjoy low manufacturing cost and thereby can have a competitive price for their STBs. Rise in import duty is being viewed as a good opportunity for budding companies, who want to make a strong presence in the Indian market.
The report by the Research and Markets points out that the key factor is the ordinance by TRAI that mandates digitization by the end of the year 2014. But, a key challenge is the non-price competition. Consumers demand excellent service, so, service providers charge different price for various services killing the USP of the core product.