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Smart TV Surges in Popularity Worldwide

Over one-quarter of TVs shipped during Q1’12 were equipped with internet connectivity, as reported in the new NPD DisplaySearch Quarterly Smart TV Shipment and Forecast Report, which tracks connected and smart TV shipments by brand, region, display technology and screen size.



Figure 1: Smart TV Penetration, Q1’12 Shipments
Source: NPD DisplaySearch Quarterly Smart TV Shipment and Forecast Report

Approximately 27% of TV sets shipped worldwide had internet connectivity, led by Japan, where 46% of sets had networking capability, and Western Europe with 36%. In a good example of how internet entertainment is developing rapidly in emerging markets, China followed closely behind Western Europe with 32% of sets that shipped having internet functionality.

In the report, NPD DisplaySearch further analyzed TV sets by service type. Basic connected TVs can access structured services from broadcasters such as Hbb.TV in Europe, BBC’s iPlayer in the UK, Hulu in the US and AcTVila in Japan. Netflix and YouTube also offer such services. According to NPD DisplaySearch, a smart TV can access a branded portal and service, not just publicly available platforms such as YouTube, or broadcaster services. Within this definition of smart TV, there are sub-categories that differ in the nature of the control of the service offering:

“Set maker controlled” sets can have unique services from a portal. No two brands are alike, and the services may be configurable as apps. “Consumer controlled” sets can escape the constraints of a portal and allow the consumer to access the whole internet. These sets typically have a browser inside. The report indicates that nearly 20% of all TVs shipped worldwide were smart TVs, the highest being in Japan with 36%, with China a close runner-up with 30%. The feature was also strong in Western Europe, over 29% of Q1’12 shipments were of smart TVs. All regions were over one-in-ten, with North America at 18%.

“Connected TV is largely driven by content,” said Paul Gray, Director of TV Electronics Research for NPD DisplaySearch. “Where there are compelling things to watch, the internet becomes a major source of entertainment. We are now seeing a second stage of evolution as internet video relocates from a PC screen onto the TV screen. In particular, Chinese consumers have found plenty to watch on the internet, so internet connectivity follows.”

One of the more surprising findings from the report indicates that no region is being left behind. Developed regions can be expected to have high shipments, and areas with low broadband uptake such as the Middle East and Africa also show a strong interest in internet connectivity.

“It is an interesting trend,” added Gray. ”There are countries in emerging regions where mobile broadband far outnumbers fixed lines, so consumers are looking to share mobile content on a big screen.”

By region, the largest shipments were in China with almost 3.0 million smart TVs shipped. Western Europe was second, with 2.1 million units shipped, while North America was third with almost 1.4 million units shipped. Strong seasonality linked to the Lunar New Year holiday helped increase shipments in China. Western Europe showed weaker demand as consumers there tend to exhibit more caution toward smart TVs.

By region, the report finds that open internet access is dominant in China, as consumers have a shortage of structured services and want to look elsewhere for content to view. However, 2012 models from all major brands incorporate browsers, and this feature trend is likely to proliferate outside of China.

Figure 2: Smart TV Penetration, Q1’12 Shipments by Brand

(JPG)

Source: NPD DisplaySearch Quarterly Smart TV Shipment and Forecast Report

Brands’ shipment mix of smart TVs reflects their regional positioning. Chinese TV brands score well due to high shipments in their home market.

The NPD DisplaySearch Quarterly Smart TV Shipment and Forecast Report provides a quarterly update of shipments in this market. Rapid shifts in smart TV feature developments are forecast, and the report also examines smart and connected TV shipments by region, analyzing industry and service trends. For more information about the report, please contact Charles Camaroto at 1.888.436.7673 or 1.516.625.2452, e-mail contact@displaysearch.com or contact your regional NPD DisplaySearch office in China, Japan, Korea or Taiwan.

 [June 12, 2012]


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