Digital TV expected to grow nearly sixfold by 2006

Digital television connections will grow from 62 million in 2001 to 350 million in 2006, according to Boston-based research firm Ovum, which also predicts that television commerce will be worth $45 billion by 2005.

That figure is in addition to revenues from services such as pay TV, gaming, education and information, which may exceed $60 billion.

"As telephone companies and traditional TV broadcasters are vying for market position, each sector must guard its strengths and exploit new opportunities," said Shirley Brown, Ovum's senior consultant in the New Media Group. "By guarding existing revenues and building service offerings in the convergent space, a market leader will emerge."

A study by Cambridge, MA research firm TechTrends revealed that 46 percent of consumers said they are interested in TV-based e-commerce services, but interest levels varied greatly among different applications. For instance, while 53 percent of consumers were interested in printing product information or coupons from their TV set, only 33 percent were interested in ordering restaurant meals for immediate delivery.

According to the study, the most likely users for television-commerce services include premium cable and digital broadcast subscribers, active online shoppers and frequent customers of home shopping channels.

"Even consumers who do not shop online represent an opportunity for online retailers," said Adriana Weinfeld, TechTrends research analyst. "Our research shows that almost half of these consumers are willing to pay a monthly fee to shop for products directly through their TV set. Since there are twice as many consumers who watch TV as surf the web, internet-based retailers like Amazon.com and Yahoo! could dramatically increase their available market by expanding their e-commerce services to the television."





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