The research firm IHS Technology has given its verdict on the prospects for Google’s Android TV platform, the new TV-centric entertainment environment that seeks to provide users with access to media streaming services and apps, similar to the experience you get with Roku and Apple TV. For Google, Android TV continues the journey that began with Google TV, failed to impress, then continued with the acclaimed Chromecast device. IHS views Android TV as the best Google effort yet to break into the living room and it predicts that it will cloud the rapidly expanding market for streaming media players and primarily challenge Roku and Amazon’s Fire TV rather than Apple TV.
It threatens Roku because that company lacks a direct integration with an ecosystem similar to Google, and it threatens Fire TV because Amazon limits content search-and-discovery results to Amazon-sourced content, while also narrowing content mirroring/casting functionality to its Amazon-branded tablets, IHS Technology explains. The company confirms: “Android TV is not likely to topple Apple’s competitive position.â€
“Today, Roku and Apple TV continue to dominate the U.S. installed base for streaming media players, with a combined 94% share in 2013, and Amazon’s Fire TV is a significant recent entrant. However, the arrival of Android TV is expected to significantly affect the competitive dynamics of this market over the long run,†says Paul Erickson, Senior Analyst for the Connected Home at IHS.
The research firm is predicting that Chromecast will reach an installed base of 1.9 million devices by end-2014 and believes this may be a harbinger for the momentum we can expect for Android TV (which will be made available via set-top boxes and televisions made by CE companies, starting later this year). Erickson thinks standalone media players using Android TV will appeal to consumers buying at lower price points.
“Standalone media player products utilizing Android TV do not have the brand recognition, established brand equity or the level of retail distribution that products from companies like Apple, Amazon, and Roku possess. But over time these [Android TV] standalone players are expected to create competitive pricing and positioning concerns [for these rivals] by delivering previously absent levels of polish, capability, ecosystem integration and content access to consumers at lower price points,†Erickson argues.
IHS adds that in the past, the typically Android-based offerings from low-priced competitors have lacked the refinement, functionality, ecosystem, and user experience to compete head to head with products from Roku or Apple. “The impending arrival of Android TV will potentially equip these lesser players and vendors with access to a complete, ready-made platform for streaming-media-player use that delivers a suite of benefits,†Erickson says.
These benefits include a new user experience purposely designed for TV, content access from Google Play as well as third-party apps, Google-powered content search and discovery with voice recognition, integration with the Android mobile device ecosystem, and built-in Chromecast functionality that enables media casting.
IHS Technology forecasts that the global installed base for streaming media players will be 50 million units by the end of this year. Focusing on the U.S., the most significant single market for this product category, the installed base will be 24 million units this year (up from 16 million last year and 10 million in 2012). IHS expects Apple TV to account for 12.1 million of these units with Roku numbering 8.7 million devices.
By 2017, the number of installed streaming media players in the U.S. is anticipated to reach 44 million units. To put that in context, IHS Technology is predicting an aggregate of 169 million Blu-ray Disc players, game consoles and Smart TVs to put the total U.S. installed base of connected TV devices in 2017 at 213 million units.
“Given the ongoing shift among consumers toward streaming media consumption, the market for standalone streaming media players is continuing to heat up,†Erickson notes.
