Bitmovin releases 2020/2021 Video Developer Report

Wednesday, September 30th, 2020
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Is the Party Over? Video Streaming Services Need to Focus on Cost for Survival According to Bitmovin’s 2020/2021 Video Developer Report Revealing Insights into Streaming Industry

  • Costs Became Top Concern During COVID-19
  • Gaming Platforms Lag Behind as Consumers Utilize Browsers/Devices for Video Content

SAN FRANCISCO, CA — Is the party over for video streaming companies? While COVID-19 has impacted businesses of all types and sizes, the streaming/OTT industry has seen a major impact. With more consumers staying home and utilizing streaming services, video consumption has skyrocketed, but so have costs.

Bitmovin, a leading provider of video infrastructure for digital media companies around the world, today revealed the results of its fourth annual “Video Developer Report” showcasing the current state of the video/streaming/OTT industry along with challenges being faced by video developers and the latest trends.

Key findings include:

Top Challenge – Reducing Costs

Bitmovin recognizes this year has ushered in an unparalleled number of challenges and unique opportunities for all businesses within the industry. The results showed the top challenge among respondents was reducing costs, replacing last year’s top concern of complex technology such as ‘live low latency.” Despite the majority of participants holding technical roles, over 51% of respondents indicated that cost control for such things as bandwidth and storage is their biggest challenge. The results are clear that many in the industry believe that video streaming services need to focus on cost optimization in order to survive.

The COVID-19 pandemic and shelter-in-place requirements have accelerated global growth opportunities for the video streaming industry. As widely reported, the numbers of viewers streaming video, and their viewing hours have skyrocketed since the onset of the pandemic. However, at the same time, given the uncertainty of the global business landscape, companies are cautiously scaling back on new projects to control costs.

It makes sense that “reducing cost” and “taking services and assets faster to market” are the top challenges in order to stay competitive. It needs to be seen if intensified competition might also lead to changing the business and pricing model as 2020 has certainly been a year unlike any other.

Greatest Opportunity for Innovation – Live Streaming at Scale

Sometimes a crisis is the best instigator of innovation because people are searching for solutions. Many streaming media industry innovations were already in progress before COVID-19, but the crisis has certainly sped up the adoption of some specific ones.
Mastering live streaming at scale is not an easy job and while it is a top challenge in the report, respondents also see this as the greatest opportunity for innovation. Even with less live sports and other events happening at the time of the survey, it is encouraging to see that it makes the top of the list of innovation topics.

Viewer engagement can be complex as well, considering the different kinds of viewers that use a service and need to be engaged in different ways. “Recommendations” and “personalizations” will play an even great role moving forward, as developers are tasked with new ways of retaining viewers. We can also expect innovative ways streaming services and providers find to put on compelling content, whether live sports, concerts, musicals or shows.

Top Platforms – HTML Browsers Tops the List, Gaming Consoles Trail Far Behind

We are living in a multi-device world. The typical OTT viewer now accesses content via three different devices. New devices and platforms are coming out on a continuous basis and this list might get even longer. The study shows that HTML Browsers (on devices including PCs and Mac) are the top places where developers are focusing their work, followed by Native iOS, Native Android and then Apple TV. It is noteworthy that only 13% of developers are developing for PlayStation 4 and Xbox One, while only 3% are streaming to Nintendo Switch. This indicates that game consoles have not yet caught on as streaming devices, but there is a potential for this to change with this fall’s launches of the PlayStation 5 and the Xbox Series S & X.

“As the streaming/OTT industry continues to rapidly expand, new challenges and opportunities will develop. Bitmovin is proud to be on the front-lines of the industry each day and this year’s study shows that even with growth there is a need for deep reflection on how money is spent and where to put assets and talent,” said Stefan Lederer, CEO of Bitmovin. “In today’s COVID world, there is huge volatility that is accompanied by large demand. The industry players that best recognize the changing technological and financial landscape will be the ones to not only survive, but to thrive.”

The Importance of Efficient Codecs – Where? What Types? Audio Codec Trends

An efficient codec and multi-codec adoption may be the competitive edge when balancing cost and quality. Software encoding on premise remains the top location for encoding video.

Consistent with previous years, cloud-based encoding implementations are increasing slightly. In 2020, cloud encoding is up 3% to 32% from 2019. Contrary to last year where we saw an increase by 5%, hardware encoders recorded the largest drop by 9%. Time will tell if this is a result of fewer live events being held or the cost efficiencies and other advantages of cloud encoding services.

For the first time in the history of Bitmovin’s study, video developers were asked about the types of encoders they use: commercial or open source. An overwhelming 51% use a mix of commercial encoders while ffmpeg was named the encoder of choice for open source.

Business goals will continue to drive the use of media codecs. The study found that while multi-codec usage is reality, most developers and organizations will take a pragmatic approach to adopt and support new media codecs depending upon their business criteria. Target audience, targeted devices and platforms, and support for 4K/8K contents are common objectives among participants surveyed.

For audio codec, the study found that AAC continues to dominate the space as it pursues its promise to be the successor of the MP3 format with its higher sound quality than MP3 at the same bitrate. Sound quality continues to prove important for elevated viewing experiences. Hence, the use of Dolby Atmos immersive sound technology which has been broadly embraced by artists, content creators, and developers alike; and is trending for future widespread use.

With most movie theaters closed or slowly re-opening due to the COVID-19 pandemic, and movie releases going straight to on-demand, living room and large screen viewing experiences are becoming state-of-the-art and creating increased demand for innovation.

Survey Methodology

For the fourth consecutive year, Bitmovin has conducted its Annual Video Developer Survey between June 29-August 9, 2020. The number of participants in the Survey and countries represented similarly reflect this global surge in demand for streaming. Bitmovin surveyed a sample set of 792 video developers, industry experts, customers and prospects from 87 countries–participation was up dramatically by 46% from 2019. Consistent with years past, demographics such as industry, company size, and job titles were predominantly in three key industry categories: broadcasters, integrators, and OTT streaming services.