According to Jeff Heynen, directing analyst/Broadband Access and Video at Infonetics Research, video equipment sales are up, despite the fact that set-top boxes are getting cheaper.
“Two of the most interesting trends in the video equipment and set-top box (STB) markets are: pay-TV operators continue to increase their investments in MPEG-4 encoders to reduce bandwidth requirements for their broadcast channels and VOD streams,” he says. “And despite healthy STB unit growth in 2011, revenue was nearly flat, reflecting the growth of lower-cost STBs in emerging markets, particularly China, combined with the increased competition we’re seeing in the more mature markets.”
Here are some highlights from the company’s VOD and encoder research:
>> Following annual declines in 2009 and 2010 during the global recession, the video infrastructure market (VOD and streaming content servers and video encoders) grew 6 percent in 2011 to $803 million, as all major world regions except EMEA increased spending.
>> Sequentially (from the third to the fourth quarters), the overall market is up 4 percent and from the year-ago fourth quarter, the market is up 6 percent.
>> Infonetics forecasts double-digit percent revenue increases in the global video infrastructure market in 2012.
>> A cumulative $1.9 billion will be spent on standard and high-definition MPEG-4 video encoders during the next 5 years (2012-16).
>> Huawei led the global VOD server market in both 4Q11 and for full-year 2011. Motorola and ZTE are neck-and-neck for global VOD revenue in 4Q11
Regarding STBs, here’s what Infonetics says:
>> In 2011, worldwide STB unit shipments grew 13.7 percent compared with the previous year, while revenue was nearly flat (up less than 1 percent, to $13.3 billion).
Similarly, global STB unit shipments grew faster (up 6 percent) than did revenue (up 3.8 percent) between the third and fourth quarters of 2011.
>> Decent growth in HD and DVR STB sales helped keep average selling prices (ASPs) from declining too quickly.
>> In the race for overall global STB revenue share, Motorola, EchoStar, Pace and Cisco lead the way, all separated by only a few marketshare percentage points in 4Q11.
IP STB and hybrid IP/DTT STB unit shipments are forecast to grow the strongest among the various types of STBs during the next 5 years, increasing their share of the total market.
>> Demand continues to accelerate for streaming devices — such as those made by Apple, Boxee, Roku, Popcorn Hour, D-Link, NETGEAR, Western Digital and TiVo — with global over-the-top media server revenue jumping 38 percent and unit shipments up 68 percent in 2011 as more service providers offer streaming video to their subscribers.