The research house says the largest pay TV operators are responsible for the functional definition and direction of set-top design and have significant ownership over at least the logical layers of the implementation. Multi-source supply agreements give operators multiple bids whenever they need to purchase new units.
"The current large scale pay TV operators we are seeing, including Comcast-Time Warner, AT&T-DirecTV, and Liberty Global's acquisition of Virgin Media and Ziggo, will in the long term better align set-top box requirements across larger markets," wrote Sam Rosen, ABI practice director. "Hybrid set-top boxes, which leverage cable or satellite as well as IP capabilities, have largely become the norm in mature markets - but will be more important from a service delivery perspective especially as the result of the AT&T-DirecTV merger."
Regarding RDK, Rosen wrote: "Similar to the impact of Android in the smartphone market, RDK will improve compatibility between different hardware boxes and even down to the set-top box chipset level. While today's set-top box market is highly fragmented, these common platforms will enable efficiencies leading both consolidation through further mergers and acquisitions, but will also force some natural consolidation."