(19 May 2007 3:00 pm)

MUMBAI: While the majority of consumers who watch online video today do so on a PC, the ultimate destination for much of this content will be the TV.

Hardware vendors in the gaming console, media adapter, and set-top box space are working to develop solutions that enable delivery of video content from the public Internet and connect it to the television.

According to ABI Research, over-the-top net video-to-TV solutions will generate about $1.5 billion in service revenue by 2012.

In a recent ABI Research survey of online consumers, 12 per cent indicated that they have purchased some form of video content delivered over the Internet. Of those, the vast majority (71 per cent) watched this video on their PCs, while another 16 per cent watched it on a TV using a burned DVD. Another eight per cent watched it using a gaming console as their video playback device. ABI Research believes that of all the consumer platforms for TV playback, video game consoles will lead in total revenue for public Internet video delivery, because of their close proximity to the TV, large hard drives, and the high penetration of online services among gamers.

ABI Research director Michael Wolf says, "The biggest challenge for online video providers and consumer platform companies today is bridging to the TV. Over the next few years new solutions from the likes of Apple, Netgear, and Sony will help cross this divide, making à la carte video download and viewing much easier. That doesn't mean this transition will be an easy one: factors such as video quality, pricing of content, and technical glitches will persist for some time.

"ABI Research believes that while Internet video delivery services for TV playback such as gaming consoles are only beginning to see public adoption, these devices, as well as products such as Apple TV, will ultimately create significant pay-content revenue opportunities if consumer platform vendors can provide easy-to-use solutions with good quality and large libraries, while offering attractive pricing options, whether subscription, download-to-own, or rental."