TV Apps Market to Hit $1.9 Billion by 2015

TV apps — interactive, web-like applications that both enhance the TV viewing experience by supplementing programming content with additional material and activities and deliver Internet content and services — are quickly becoming the standard revenue ecosystem on Internet Connected TVs. The growth in adoption of TV app platforms will result in revenues from apps on TVs going from just $10 million in 2010 to $1.9 billion by 2015 according to a new report from GigaOM Pro.

This fast growth in revenue will in large part result from the large number of households that will have networked TVs. By 2015, 6 in 10 TVs shipped worldwide will have a network connection (Ethernet, Wi-Fi or both) and  70 percent of those will come with an embedded app platform and app store.

Embedded app stores will be the method for bringing apps to the TV, but other approaches are also being pursued, including full, video-optimized browsers, such as Boxee, Kylo and Oregan Network’s Onyx Media Browser. Cable MSOs and IPTV service providers are also rolling out their own network-based apps platforms by leveraging industry-standard technologies like EBIF and Tru2Way. In some cases, service providers are also embedding third-party software, such as ActiveVideo Networks’ Cloud TV platform leased with set-top boxes to enable greater app functionality.

The most widely distributed embedded app platforms in 2010 include Yahoo’s Widget Channel, as well as those from Vudu (recently acquired by Wal-Mart) and DivX. But major mobile app platform providers Apple, Google and Microsoft are all eying connected TVs as fertile ground for extending their mobile franchises. Google, for instance, recently began work with Sony and Intel on an Android-powered Google TV platform, though no date of introduction has been announced.  Apple’s iPad is fueling rapid development of media-related apps for its iTunes App Store platform that could eventually become the foundation for a revamped Apple TV strategy.

James Grant Hay is a Web-to-TV Strategist, he is currently working on a Social TV applications project with a major consumer electronics brand and is a listed developer with the TV App Marketplace in the Netherlands, EU.