Friday, January 9, 2015

Infonetics: Shift to Generic Hardware and Virtualization Pressuring Video Equipment Prices

Global broadcast and streaming video equipment revenue decreased 4 percent to $810 million in the first half of 2014 (1H14), with nearly all product segments down, according to a new report from Infonetics Research.


“The cost of encoding and transcoding platforms continues to come down, pressuring video and broadcast equipment revenue as pay-TV providers move to generic hardware platforms and, ultimately, network functions virtualization (NFV) rather than dedicated platforms,” said Jeff Heynen, principal analyst for broadband access and pay TV at Infonetics Research. “This is a long-term shift that will keep video revenue from growing more significantly, despite the fact that pay-TV providers must fundamentally alter their video processing environments to support linear, over-the-top (OTT) and multiscreen content that continues to grow exponentially.”

Some highlights:

  • Sales of video-on-demand (VOD) playout servers rose 20 percent in 1H14 from 2H13 as operators in China and the Middle East continue to drive spending 
  • Content delivery network (CDN) edge server revenue is forecast by Infonetics to grow at a 14 percent CAGR from 2013 to 2018, and multiscreen broadcast encoders are expected to grow moderately 
  • Despite the sluggishness in the first half of the year, Infonetics expects streaming video and broadcast equipment revenue for the full-year 2014 to be up slightly.
http://www.infonetics.com/pr/2014/1H14-Broadcast-and-Streaming-Video-Eqpmt-Market-Highlights.asp

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