Thursday, April 8, 2010

Infonetics: Video Infrastructure Spending Holds Steady

Worldwide video infrastructure revenue held steady from 3Q09 to 4Q09 at $625 million, with all segments up but one, according to new figures released by Infonetics.

Increased spending was noted for video on-demand (VOD) and streaming content servers, video encoders, IPTV middleware/content delivery platforms, edge QAMs, digital cable middleware, and satellite video middleware. Meanwhile, spending on video content protection software was down.

For the full year 2009, video infrastructure revenue decreased 11% to $2.5 billion. Worldwide video on-demand and streaming content server revenue increased 60% from 2008 to 2009, and is expected to increase rapidly over the next four quarters.

There were 417 million cable video subscribers worldwide in 2009; that number is expected to hold steady through at least 2014 as standard cable video subscribers switch over to digital cable video.

"In the ongoing battle between cable and telco IPTV operators, both continue to spend furiously to add video-on-demand and streaming content server capacity to support the rollout of on-demand HD content and provide start-over and remote storage-digital video recorder services, all of which require the delivery of unicast streams to set-top boxes. This aggressive move to full unicast models for video delivery is driving strong growth in video-on-demand and streaming content servers. While telco, cable, and satellite operators all saw sustained video subscriber growth in 2009, it certainly was not at the growth rates of years past, so operators held off on more significant infrastructure investments, resulting in a down year for video infrastructure overall outside of VOD servers and edge QAMs," notes Jeff Heynen, Infonetics Research's directing analyst for broadband and video.