ABI: Gaming consoles to lead Net-video-to-TV market

The market for allowing consumers to play Internet-delivered video over their televisions will yield $1.5 billion in service revenue by 2012, according to a new report from ABI Research.

The players in that space will offer a variety of different approaches, including video game consoles, hybrid set-top boxes managed by video service providers, Internet set-top boxes such as Apple TV, and personal video recorders from non-service providers. But ABI believes gaming consoles will take the lead.

In a recent ABI survey, 12% of online consumers said they have purchased some form of video content over the Internet. Of those purchasers, 71% said they watched the video on their personal computers, 16% burned it to a digital video disc and then watched it on TV, and 8% watched it using a gaming console.

Still, ABI predicts gaming consoles will capture more Internet video revenue than any other TV playback platform, since they are located near the TV, have large hard drives and already successfully deliver online services.

"Over the next few years, new solutions from the likes of Apple, Netgear, and Sony will help make à la carte video download and viewing much easier,” ABI Research director Michael Wolf said in a statement issued today. “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."