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IHS: Apple TV Growing in Popularity

More than 10 million Apple TV devices shipped in 2015, the fifth largest volume among set-tops, and based on the revenue the device generated for Apple in 2015, it places third in the set-top market, according to data from research firm IHS.

Only Arris, Technicolor, Skyworth and ZTE shipped more set-top units in 2015. And the third-place revenue ranking for Apple TV marks a six-spot jump in just one year.

“The STB market has certainly grown since 2007, when Steve Jobs originally described the Apple TV business line as a ‘hobby,’” said Daniel Simmons, director of connected home for IHS Technology. “Now we’re seeing sales of Apple’s consumer devices in the millions, which has catapulted the company ahead of leading STB manufacturers that ship to pay TV providers. Apple TV’s particular success is a result of translating consumption habits from across Apple’s wider device ecosystem onto the TV screen.”

Overall set-top shipments grew nearly 5% in 2015 to 353 million units, thanks to the growing need for boxes that can handle internet-protocol television (IPTV) services in China. Revenue was up more than 3% to $5.7 billion during the fourth quarter of 2015, thanks to next-gen device launches by Apple, Amazon and Roku. However, revenue for all of 2015 was down 5.4% to $22.2 billion, due to lower demand in North America.

“The new positioning of Apple at the top of the set-top box market reflects several trends,” Simmons said. “Pay TV specific set-top boxes are becoming less important for consumers to access premium content, because Netflix, HBO Go and other OTT video platforms now offer top-tier content to retail OTT STBs.

“As retail STBs have grown in the market, traditional pay TV set-top vendors have been forced to re-position themselves, with significant consolidation at the top of the market, diversification toward software and services in the middle, and low-end vendors moving toward broader volume.”