1/6/2009 -- Christmas came early for Cisco Systems Inc. with an announcement from market watcher Infonetics Research declared that Cisco -- which became an overnight sensation in the IPTV space with its acquisition (more than two years ago) of the former Scientific Atlanta -- was nipping at the heels of IPTV giant Motorola.

That's one of the more eyebrow-raising upshots of a recent report from Infonetics -- viz., IPTV and Switched Digital Video Equipment, Services and Subscribers -- which found that the switched digital video (SDV) equipment segment grew at a healthy (but by no means scorching) clip in the third quarter of last year, reaching $1.4 billion.

IPTV growth will probably slacken going forward, as Infonetics revised its estimates in the face of the worsening economic situation. "Annual overall growth will continue in the worldwide market through the downturn, but will grow in double-digit percentages rather than high triple-digit percentages, as it has in previous years," a statement from Infonetics reads.

"We still see growth coming from the telco IPTV sector because IPTV is one of the key ways telcos can hold on to their broadband subscribers and increase revenue per user, so providers will continue to roll out new networks or expand their existing networks," said Jeff Heynen, directing analyst for broadband and video at Infonetics Research, in a statement. "Meanwhile, the cable switched digital video segment took a hit in the third quarter when Comcast slowed its SDV rollout and shifted its capex focus to DOCSIS 3.0 rollouts. Still, cable MSOs will continue to introduce switched video capabilities into their digital TV networks, just at a slower pace than we expected prior to the economic downturn, which is forcing families to rethink their budgets."

Motorola remains the overall market leader in the lucrative set-top box (STB) segment, which accounts for nearly three-quarters (70 percent) of all IPTV and SDV equipment revenues.

Cisco is coming on strong, however. In the third quarter, for example, Cisco grew its market share by 6 percentage points, vaulting it to second place in the race for STB market bragging rights. --Stephen Swoyer