Video Infrastructure Market Tops $800 Million in 2011; Set-Top Boxes Get Cheaper

Wednesday, April 18th, 2012 
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CAMPBELL, Calif. — Market research firm Infonetics Research released excerpts from two recently published video equipment market share and forecast reports, ‘Video-on-Demand (VOD) and Encoder Equipment and Video Subscribers,’ which tracks video equipment sold to telco IPTV, cable video, and satellite video providers, and ‘Set-Top Boxes and Subscribers,’ which tracks IP, cable, satellite hybrid, DVR, and high definition (HD) STBs, as well as OTT media servers.

ANALYST NOTE

“Two of the most interesting trends in the video equipment and set-top box markets are 1) across the board, pay TV operators continue to increase their investments in MPEG-4 encoders to reduce bandwidth requirements for their broadcast channels and VOD streams, and 2) 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,” notes Jeff Heynen, directing analyst for broadband access and video at Infonetics Research.

VOD AND ENCODER MARKET HIGHLIGHTS

  • 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% 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% and from the year-ago fourth quarter, the market is up 6%
  • 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 (SD and HD) MPEG-4 video encoders over the next 5 years, from 2012 to 2016
  • Huawei leads the global VOD server market in both 4Q11 and for the overall year 2011; Motorola and ZTE are neck-and-neck for global VOD revenue in 4Q11

VOD AND ENCODER REPORT SYNOPSIS

Infonetics’ quarterly ‘VOD and Encoder Equipment and Video Subscribers’ report provides worldwide and regional market share, market size, analysis, and forecasts. Video equipment tracked: VOD and streaming content servers, SD and HD MPEG-2 and MPEG-4 video encoders. Subscribers tracked: telco IPTV, analog and digital cable video, and satellite video subscribers. Vendors tracked: Anevia, ARRIS Group, Cisco Systems, Concurrent, Edgeware, Envivio, Ericsson, Harmonic Inc., Huawei, Motorola, OptiBase, SeaChange, Thomson Video Networks, UTStarcom, ZTE, and others.

STB MARKET HIGHLIGHTS

  • In 2011, worldwide set-top box unit shipments grew 13.7% compared to the previous year, while revenue was nearly flat, up less than 1%, to $13.3 billion
  • Similarly, global set-top box unit shipments grew faster (+6.0%) than revenue (+3.8) between the third and fourth quarters of 2011
  • Decent growth in high definition (HD) and DVR STB sales helped keep average selling prices (ASPs) from declining too quickly
  • In the tight race for overall global STB revenue share, Motorola, Echostar, Pace plc and Cisco lead, all separated by only a few market share percentage points in 4Q11
  • IP STB and hybrid IP/DTT STB unit shipments are forecast to grow the strongest among the various types of set-top boxes over 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 Inc. — with global over-the-top (OTT) media server revenue jumping 38% and unit shipments up 68% in 2011 as more service providers offer streaming video to their subscribers

STB REPORT SYNOPSIS

Infonetics’ quarterly STB report provides market size, market share, analysis, and forecasts through 2016, tracking: Advanced Digital Broadcast (ADB), Amino, Cisco, Coship, Dasan, DVN, Echostar, Humax, Huawei, Jiuzhou, Motorola, Netgem, Pace, Sagemcom, Samsung, Skyworth Digital, Sumitomo, Technicolor, ZTE, and others. Types of STBs tracked: IP STBs, cable STBs (digital and hybrid IP/QAM), satellite STBs (hybrid IP/DVB-S), hybrid IP/DTT STBs, DVR STBs, HD STBs, and OTT media servers. Types of subscribers tracked: pure and hybrid telco IPTV subscribers, analog and digital cable video subscribers, and satellite video subscribers.