The global broadcast equipment market was valued at USD 4.43 billion in 2020. It is expected to reach a value of USD 6.13 billion by 2026, registering a CAGR of 5.66%. The growing number of devices capable of supporting digital media along with increasing access to high-speed internet has provided consumers with an option to access the media content of their own choice in terms of information, entertainment, or social activity anywhere, anytime
Over the last few decades, the demand for better-quality video and audio from consumers has resulted in broadcast equipment products and technology being upgraded rapidly. With content being produced in UHD and 4K formats, transmission in the same format for improved viewing quality has led to IP live-production technology. This is significant for live production, where a premium is placed on flexible and efficient system control.
Broadcasters are increasingly focusing on product innovation to replace conventional SDI-based environments with live production systems that offer system control and high efficiency. Also, the growing popularity of high-efficiency video coding (HEVC) standards propels the demand for equipment, such as encoders, in the market. Moreover, the introduction of multi-channel video encoders has allowed users to generate multiple different streams, resulting in reduced hardware. HEVC can deliver up to 50% better data compression than AVC or H.264 with the same or substantially improved video quality, at the same bit rate. This ability enables delivering 4K and HDR video over existing delivery networks.
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Notwithstanding the uncertainties owing to COVID-19, the market is well-positioned to benefit from an economic revival and the industry transition to IP and Cloud-based solutions. The industry has reached a stage where new habits and means of working have settled for most broadcast and media organizations. Cloud infrastructure is expected to continue to support remote workflows and eliminate dependency on on-premises systems.
Regardless of purpose-built hardware, any broadcast infrastructure on site must be able to support peak demand. Due to this, just the virtualization of functions into on-premise hardware does not provide the expected cost savings or flexibility that an SaaS model could bring. Even if a supplier retains their ownership of the hardware and charges the customer for use through a pay-as-you-go model, they will need to recoup the hardware costs. Furthermore, the customer becomes reliant on the vendor for services. This places the consumer in a weak bargaining position and unable to keep rent from increasing year to year. Due to this, the market is witnessing a shift from hardware to SaaS models.
The rapidly evolving nature of digital audio and video formats and the lack of any open, national or international consensus standards for creating and preserving digital audio and video are challenging the market’s growth. Standards for digital audio and video formats and compression methods are evolving with every new advancement of digital technology.
Key Market Trends
Digital broadcasting is Expected to Witness Significant Growth
The practice of using digital signals instead of using analog signals for broadcasting over radio frequency band is called digital broadcasting. The technology has evolved over the years, with various governments across the world focusing on digital switch over and analog switch off. Moreover, the technology has transitioned from BVB-T + MPEG2 to DBV-T2 + MPEG7.
The technology mainly involves three ways of broadcasting for television such as the DTH-Direct to Home, also called the Satellite Television, IPTV- Terrestrial or Internet Protocol Television, and Cable Television which predominantly involves the customers to pay and use. Furthermore, the technology has proven worthy to transmit the radio frequency signals for FM and podcast channels.
The market is witnessing various mergers, acquisitions, partnerships, and collaborations, which boosts the need for digital broadcasting infrastructure that includes antennas, switchers, servers, encoders, transmitters, repeaters, among others. For instance, In February 2021, iHeartMedia, an audio company that mainly publishes podcasts in America acquired Triton digital, a technology provider for the digital audio and podcast industry, for USD 230 million. The acquisition is expected to enhance the distribution methods of broadcasting, audio, on-demand, digital streaming radio, and podcasting.
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Various investments are being made from the Sports associations to broadcast various sports activities such as rock climbing, cricket, football tennis, among others, on linear TVs. For instance, The International Federation of Sport Climbing announced the partnership with four broadcast partners such as RAI Sport, Sport5, SRG-SSR, and Zhibo.tv to broadcast IFSC World Cup and World Championships competitions in 2021, finals of the 12 World Cup competitions, and World Cup in Meiringen, Switzerland either on delayed as live or on a live basis. This further increases the investments of the broadcasters on the infrastructure to target a greater audience.
Digital broadcasters are also investing in enhancing the content for linear TVs with D2C such as a paramount+, Disney+, discovery+, and OTT offering that boosts infrastructure broadcasting development. Some of the strategies of the broadcasters are to ensure all the content of the D2C platform to be aired on linear TV channels. However, the broadcasters are still questioning and planning whether to display the content on D2C and then display the same on free to air after a period of time or show some content on free to air and then show the full content on D2C. Such instances are catering to the growth of the market.
North America is Expected to Hold Significant Market Share
The North American region is expected to witness substantial growth during the forecast period. The rapidly growing number of satellite and cable television channels, buoyed with the increasing internet penetration, has provided broadcasters with the opportunity to offer high-quality content to viewers, which is one of the prominent factors behind the demand for broadcast equipment. The online platforms in the region are expanding at a high rate and including new innovative technologies, primarily meant to enhance personalized user experiences.
One of the major drivers for the region’s market has been the rapid adoption of OTT services. The rapid growth in the OTT subscriptions in the region leads to the adoption of broadcast equipment, especially encoders, which allow appropriate video quality and density by compressing a video stream. The use of encoders for OTT also ensures uninterrupted streaming with outputs of different formats to serve different viewing devices such as laptops, smartphones, tablets, and others.
The shift of broadcasting equipment toward software as a service (SaaS) also molds the market over the forecast period. The SaaS-based infrastructure reduces the cost of infrastructure, thus, providing an integrated solution. Also, the move toward the pay-as-you-go model from the load of equipment by broadcasters creates opportunities for the market.
Local vendors are also investing heavily to capitalize on the opportunities brought by the pandemic. For instance, in March 2021, Signiant Inc. announced the acquisition of Kyno, which provides embedded media processing software. The acquisition helps Signiant Inc. extend the functionality of the Software Defined Content Exchange (SDCX) SaaS platform, adding tools for interaction with media assets. With nearly one million users worldwide, the platform connects more than 50,000 Media & Entertainment companies of all sizes.
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