Posts Tagged ‘broadcast cloud’

Evolution of Opinions About Virtualization and Cloud Technology / Service in the Media and Broadcast Industry

Analysis, broadcast industry technology trends, broadcast industry trends, broadcast technology market research, Conference Sessions, technology trends | Posted by Joe Zaller
Nov 18 2015

This is the third in a series of articles about some of the findings from Devoncroft’s 2015 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2015 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry.

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The Most Interesting Take-Away From the 2015 SMPTE Conference … A Change in Sentiment Towards Cloud

On the last day of the 2015 SMPTE technical conference in Los Angeles, I was chatting to the CTO of a large media company.  I asked this person their opinion on the most interesting take-away from the 2015 SMPTE Conference.

After pause for thought the answer (I am paraphrasing here) was that three years ago when SMPTE started the cloud technology track at their annual conference, the 2013 cloud session chair Al Kovalick (who this year chaired the IP Networking track) practically had rotten tomatoes thrown at him when he told the (highly skeptical) audience that broadcasters and media company could indeed get to 5 nines” of reliability, and that it would not be long until media technology infrastructure migrated to the cloud.

Fast forward three years to the 2015 SMPTE Technical Conference, and the most interesting take-away for this media CTO was that not only were there no tomatoes thrown at speakers presenting papers about cloud and IP – it was just the opposite.  There appeared to be was broad agreement, that cloud technology is real (or at least becoming real) and that media companies are rapidly adopting it in various ways.  So minds (and therefore budgets) have changed considerably in a very short space of time.

 

Our Research Shows a Similar Change in Sentiment

What this executive expressed dovetails with the way the opinions of participants in Devoncroft’s annual Big Broadcast Survey (BBS) have changed over the past several years.

As mentioned in a previous post, one of the key outputs from the BBS is the annual BBS Broadcast Industry Global Trend Index. This is a ranking of the broadcast industry trends that are considered by BBS respondents the most commercially important to their businesses in any given year.

The way the opinions about cloud technology and virtualization have evolved in the minds of media and technology buyers is very interesting to observe.

In the 2015 BBS Broadcast Industry Global Trend Index, “Cloud computing / virtualization” ranked as the #5 trend (maintaining the same position as in 2014 and 2013).

For the past several years, it was apparent that there was not a clear understanding of how cloud technology would be deployed in the broadcast environment, and what benefits it would bring.

Today, our research shows that despite remaining skepticism about the cloud (not to mention security concerns), the acceptance of (or at least the willingness to consider) cloud technology and related services increased noticeable over the past several years.

 

 

Plans for Cloud Deployment in Media and Broadcast

But what are buyers of broadcast technology actually planning to deploy in the cloud, and do they actually trust cloud technology?

There is a substantial amount of additional data captured in the 2015 BBS on what technology segments end-users are deploying and planning to deploy cloud services, along with what efficiencies they hope to achieve by deploying cloud Services.  This data is presented in the 2015 BBS Global Market Report (available for purchase).

Over the past year, we’ve observed that cloud services / cloud technology is one of the fastest growing areas of project spending in the media and broadcast industry.

But what are buyers of broadcast technology actually planning to deploy in the cloud, and do they actually trust cloud technology?

 

Opinions and Sentiment About Cloud are Changing Rapidly

Perhaps more than any other topic, the industry’s plans for cloud have evolved considerably over the past several years.

For the past several years, we’ve been asking BBS respondents what they’ve already deployed, or plan to deploy in the cloud over the next 2-3 years.

As the chart below highlights, the answers given by BBS respondents over the past several years have changed over time, as cloud went from a non-issue, to a curiosity, to a top-5 project.

Today, we are hearing more and more from end-users about serious projects being deployed in the cloud, and many more are evaluating how to take advantage of the benefits offered by cloud technology.

 

2009-2015 Evolution of planned cloud deployments in media & broadcast

 

To further illustrate how plans for deployment of cloud technology in media and broadcast have changed over the past several years, the three “word clouds” below show the free-text responses we received from BBS participants about what they have already deployed in the cloud or are planning to deploy in the cloud over the next several years.

 In 2013, plans for cloud technology were highly fragmented, with projects ranging from email, to collaboration, to storage and archive.

 

2013 BBS - Planned Cloud Deployments

 

Many respondents to the 2013 BBS said they planned to use cloud technology to deploy things like email systems, collaboration portals and file-sharing, and straightforward applications such as off-site storage of media assets. However, very few respondents contemplated “serious” media operations in the cloud.  Perhaps that’s because they were busy throwing tomatoes at Al Kovalick…

 

One year later, respondents to the 2014 Big Broadcast Survey revealed that they had started to contemplate more seriously what could be done in the cloud for media operations.  In addition to plans for email and collaboration systems, there was a noticeable increase in the number of companies that were planning to utilize cloud applications for media processing (such as transcoding and editing) and workflow-related applications (such as VOD and archive management).

 

2014 BBS -- Planned Cloud Deployments Word Cloud

 

We also heard from many 2014 BBS respondents that they were beginning to experiment with different operational models and architectures involving virtualization and cloud technologies.  However, in 2014 the majority of responses still involved more “simplistic” cloud technologies such as collaboration, off-site storage, and subscription software services, and file sharing.

 

By 2015, both cloud infrastructure as well as end-user understanding of what can be done in the cloud had evolved.

2015 BBS - Planned Cloud Deployments.

2015 BBS respondents shared information about specific projects already underway, or that have been completed.  We’re also seeing planned cloud deployments of “serious” media operations such as playout, compute, workflow, and MAM.

Perhaps most interestingly, we saw the term “confidential” more than ever when we asked people about their plans to use for virtualization and cloud technology in broadcast and media operations.  Based on what we see and hear in the market, we’re taking this as an indication that that trials and projects are already underway.

This was reinforced throughout the 2015 SMPTE Technical Conference, where presenters from BT, Fox NE&O, Amazon AWS, Sundog, Telestream, Levels Beyond, and others all talked about the potential of virtualization and cloud, and described real-world examples of how cloud and virtualization are being used today, and how this will increase in the future.

So hearing from a media company CTO that one of the most interesting take-aways from the 2015 SMPTE conference was that there is growing acceptance of cloud is not a surprise.  Our data shows a clear progression of the importance of cloud technologies and cloud services in media and broadcast operations, and we expect this to continue into the future.

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Related Content

2015 Big Broadcast Survey (BBS) Reports Now Available

The 2015 Big Broadcast Survey

Ranking The Most Commercially Important Trends in Broadcast and Media Technology – 2015 Edition

Download New Devoncroft Partners Report: NAB 2015 – Observations and Analysis of the Media Technology Industry

New Devoncroft Report Available for Download: IBC 2015 – Observations & Analysis of the Media Technology Industry

2015 SMPTE Technical Conference Program

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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Ranking The Most Commercially Important Trends in Broadcast and Media Technology – 2015 Edition

Analysis, broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research, OTT Video, technology trends | Posted by Joe Zaller
Nov 09 2015

This is the second in a series of articles about some of the findings from Devoncroft’s 2015 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2015 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry.

 

Measuring the Most Important Trends in the Broadcast and Digital Media Technology Industry

Each year, Devoncroft Partners conducts a large-scale global study of the broadcast industry called the Big Broadcast Survey (BBS).  Nearly 10,000 broadcast professionals in 100+ countries participated in the 2015 BBS, making it the most comprehensive study ever done in the broadcast industry.

Firstly, we’d like to once again thank all the people who participate in the BBS each year.  We’re thankful that you take time from your busy schedules to participate, and we love (and read all of) your feedback.

 

One of the key outputs from the BBS is the annual BBS Broadcast Industry Global Trend Index. This is a ranking of the broadcast industry trends that are considered by BBS respondents the most commercially important to their businesses in any given year.

In order to ensure the relevance of the trends we measure each year, we spend a considerable amount of time seeking feedback about the structure of our reports from a wide variety of industry professionals.

As part of this process, the composition of the BBS Broadcast Industry Global Trend Index is reviewed each year in conjunction with Devoncroft clients, broadcast technology end-users, and a variety of domain experts.  New trends are added to the Index when BBS stakeholders believe that the value of this additional trend information outweighs the resulting distortion of the year-over-year comparisons.

Based on discussions with clients, end-users, and experts during the planning stages of the 2015 BBS project, we decided to maintain the same list of trends as contained in the 2014 BBS Broadcast Industry Global Trend Index.  The benefit of this approach is a straightforward comparison of how trends were ranked in 2015 versus 2014 across all demographics.

After this review process, the decision was taken to not change the trends measured in the 2015 BBS.  This enables a 1:1 comparison of trends on a year-over-year basis.


 

The 2015 BBS Broadcast Industry Global Trend Index

To create the 2015 BBS Broadcast Industry Global Trend Index, we presented BBS respondents with a list of 18 industry trends and asked them to identify the one trend they consider to be “most important” to their business, the one trend they consider to be “second most important” to their business, and the other trends (plural) they consider to be “also very important.”

We then apply a statistical weighting to these results, based on how research participants ranked the commercial importance of each trend.
Please note that our goal from this question is to help clients gain insight into the business drivers behind the respondent’s answer.  Therefore, respondents were asked to rank these trends in the context of the commercial importance to their business, rather than “industry buzz,” or “cool technology,” or marketing hype. The 2015 BBS Broadcast Industry Global Trend Index is shown below.

 

 

2015 BBS - Devoncroft Big Broadcast Survey 2015 Broadcast Industry Global Trend Index

 

When reviewing the data presented above, readers should note the following about the 2015 BBS Broadcast Industry Global Trend Index:

  • It is a measure of what research participants say is commercially important to their businesses in the future, not what they are doing now, or where they are spending money today (these topics will be addressed in future posts)

 

  • The chart above is visualized as a weighted index, not as a measure of the number of people that said which trend was most important to them

 

  • It measures the responses of all technology purchasers (i.e. non-vendors) who participated in the 2015 BBS, regardless of company type, company size, geographic location, job title, etc. Thus the responses of any demographic group such as a particular company type or geographic location may vary widely from the results presented in this article.

 

Analyzing the 2015 BBS Broadcast Industry Global Trend Index

Multi-platform content delivery (MPCD) is cited by a wide margin as the most important trend commercially to respondent businesses.  This is not surprising given the rise of new distribution mediums and devices.  Indeed, across multiple studies, research participants have repeatedly stated multi-platform content delivery is the most commercially important trend to their business over the next several years.

However, our discussions with broadcasters, content owners, and technology vendors indicate that despite the obvious fact that the way content is delivered and consumed has changed forever, this has not yet (with few exceptions) translated into profitable revenue streams for end-users.  There are a number of reasons why this is the case, and these have significant implications for content owners, broadcasters, and technology vendors.

These implications are addressed later in this report, as well as on the Devoncroft website.

Although multi-platform content delivery is by far seen as the most important trend in 2015, there are quite a few other interesting things to consider in the BBS Broadcast Industry Global Trend Index.

For over the past decade the transition to HDTV operations has been a major driver of end-user technology budgets, and therefore technology product sales.  The first BBS Broadcast Industry Global Trend Index, published in 2009, ranked the transition to HD as the #1 trend globally.  In the seven years since, the transition to HD operations has drifted lower in the rankings based on the continued adoption of HD technology infrastructure globally.  For the first time in 2014, the transition to HD operations was not ranked among the top five trends by respondents, instead ranking #6.  In 2015, the transition to HD operations declined further, now ranking #8.  However, within developing markets or smaller media markets within developed regions, the HD transition remains one of the strongest drivers of broadcast industry revenue.

We provide significant coverage of the ongoing global transition to HDTV operations in the 2015 BBS Global Market Report (available for purchase). This includes a granular breakdown of the current and projected future progress that end-users have made in their transition to HD, as well as the upgrade plans for fifteen product categories including cameras, switchers, routers, servers, graphics, encoders, and video transport. We’ll also be publishing more information about project-based spending and the HD transition later in this report, as well as on the Devoncroft website.

A trend that has increased in importance over the past several years is “IP networking & content delivery,” which is ranked as the #2 most important trend in the BBS Broadcast Industry Global Trend Index.

The move to IP-based infrastructure has increased in importance in response to several market developments.  Based on our research, end-user motivations for moving to IP-based infrastructure are more nuanced than simply generating operational efficiencies, though this goal is an important component.  Rather, end-user responses to the Big Broadcast Survey are consistent with a more encompassing goal of moving to fundamentally different technology infrastructures to better support evolving media business models.

While the move to IP-based infrastructure is still at the stage of early adopters in broadcast operational environments, there were several notable developments during 2015.  These included the progression of interoperability standards (e.g. SMPTE 2022-6), the advancement of work from the joint task force on networked media (JT-NM) [sponsored by SMPTE, EBU, and the VSF], the creation of several individual vendor ecosystems (e.g. Evertz ASPEN), and the elevated activities by large IT providers (e.g. Cisco).

A transition to IP-based infrastructures is likely inevitable given the comparative size of the broadcast technology sector versus the broader IT industry.  This greater size equates to far greater research and development resources.  There remains, however, several obstacles preventing widespread adoption of IP-based infrastructure in the immediate term.  For this reason we are expecting the move to IP to represent a major industry driver over the mid-to-long term.

Regardless of timing, the transition to IP-based infrastructure will have profound implications for both technology buyers and suppliers.

The #3 ranked trend in the 2015 BBS Broadcast Industry Global Trend Index is “4K / UHD.”  2015 is the second year the BBS has included 4K / UHD as a trend within the BBS Broadcast Industry Global Trend Index. It was added based on feedback from Devoncroft’s clients.  The high ranking of 4K / UHD in both 2014 (ranked #4) and 2015 demonstrates these requests were well-founded.

Many in the industry believe 4K / UHD is the next major driver of infrastructure upgrades – similar to the transition to HD over a decade ago.

While there is no doubt that 4K / UHD is a very important development, the data collected in the 2015 BBS lends skepticism to the proposition 4K / UHD will have a similar impact on the industry as the transition to HDTV operations, which drove a massive wave of technology spending that lasted more than a decade.

Although episodic and documentary content has, or will soon, move to 4K/UHD acquisition along with archive activities (because it extends the useful life of content assets), it will take time for 4K/UHD to move into mainstream live production environments such as news and sports.  One reason is creating a live event in 4K / UHD is complex and expensive to create versus an HD broadcast.  Uncompressed 4K / UHD requires real-time processing at 12Gbps, and the full production chain is not yet widely available.  Another critical issue is that (until mid-2015) most 4K / UHD capable cameras utilize large format single sensors and cine-style PL-mount lenses. While the shallow depth-of-field produced by these acquisition systems is a perfect match for theatrical or drama production, it causes problems in live sports production, where depth-of-field is important to keep critical action sequences in constant focus.  There were several announcements by camera manufacturers during 2015 to address this issue with depth-of-field.

Nevertheless, there’s no doubt that 4K / UHD is driving strong interest and excitement in the industry.  The question remains whether it will become a mainstream technology driver as HD has been, or whether it will only achieve penetration into technology infrastructure through the normal product upgrade cycle.

The trend ranked #4 in the 2015 BBS Broadcast Industry Global Trend Index, “file-based / tapeless workflows,” is a clear indication of the importance of increased efficiency for broadcast technology end-users.  This trend has accelerated as the transition to HDTV (ranked #8 this year) begins to decline in developed markets around the world.

Over the past several years, we’ve observed a pattern whereby broadcasters, who have invested considerable time, effort, and money into transitioning their operations to HD, begin to shift their focus towards increasing the efficiency of their operations. Over time, efficiency has become a key driver of broadcast technology purchasing.  In fact, our research shows that in many cases, increased operational efficiency and cost savings are more important than cutting-edge technology.

This is because the economics of the entire industry have changed – because of MPCD and other factors – and as a result, end-users must change their cost structure (radically in some cases) in order to generate sustained profitability into the future.

This has implications for the broadcast industry in terms of both workflows and product procurement, and as a result, the importance of both “file-based workflows” and “IP networking & content delivery” has increased as broadcast technology buyers continue to look for efficiencies as they transition to new technical platforms and business models.  The desire for broadcast technology buyers to gain operational efficiencies will likely continue to be a strong macro driver in 2015, as broadcasters continue to deploy new workflows.

Cloud computing / virtualization,” is the #5 ranked trend (maintaining the same position as in 2014 and 2013).

For the past several years, it was apparent that there was not a clear understanding of how cloud technology would be deployed in the broadcast environment, and what benefits it would bring.  This is still the case in many respects in 2015.  However, similar to observations in 2014, our research shows that despite remaining skepticism about the cloud (not to mention security concerns), the acceptance of (or at least the willingness to consider) cloud technology and related services increased noticeable during the year.

But what are buyers of broadcast technology actually planning to deploy in the cloud, and do they actually trust cloud technology?

There is a substantial amount of additional data captured in the 2015 BBS on what technology segments end-users are deploying and planning to deploy cloud services, along with what efficiencies they hope to achieve by deploying cloud Services.  This data is presented in the 2015 BBS Global Market Report (available for purchase).

Selected example data is provided in this free report from the Devoncroft 2015 BBS Global Project Index (see Part 2 of this report, starting on page 29).  It highlights how cloud services / cloud technology is one of the fastest growing areas of project spending in the broadcast industry.

But what are buyers of broadcast technology actually planning to deploy in the cloud, and do they actually trust cloud technology?   Perhaps more than any other topic, the industry’s plans for cloud have evolved considerably over the past several years.

For the past several years, we’ve been asking BBS respondents what they’ve already deployed, or plan to deploy in the cloud over the next 2-3 years.

As the chart below highlights, the answers given by BBS respondents over the past several years have changed over time, as cloud went from a non-issue, to a curiosity, to a top-5 project.

 

2009-2015 Evolution of planned cloud deployments in media & broadcast

 

Today, we are hearing more and more from end-users about serious projects being deployed in the cloud, and many more are evaluating how to take advantage of the benefits offered by cloud technology.

But what are media technology end-users actually deploying in the cloud?  This will be discussed in a future post.

“Improvements in compression efficiency,” which is ranked #6 in the 2015 BBS Broadcast Industry Global Trend Index is consistent with the desire for increased efficiency. With content distribution models having migrated from single linear broadcast channels, to multi-channel Pay TV playout, to a totally on-demand environment, high quality compression is a critical success factor for broadcasters and content playout platforms.

A plethora of new channels, and the desire for simultaneous bandwidth saving and increased image quality for MPCD services have driven an increasing focus on high quality compression systems. For the past several years this has resulted in better MPEG-2 and H.264 compression products for primary distribution, contribution, and redistribution to consumers. H.265 (HEVC) compression technology holds the promise of further reducing the bandwidth required to deliver high quality images, particularly for 4K / UHD channels.  Despite continued momentum in 2015, HEVC is still in early stages of adoption, though wider deployments are expected over the next 12 to 18 months.

In addition to creating greater efficiencies, end-users are also looking for ways to generate incremental revenue in an environment where the economic model of the industry is changing dramatically.  Thus “video-on-demand,” which is ranked #7 in the 2015 BBS Broadcast Industry Global Trend Index, will remain a strong driver for content owners, media companies and broadcasters.  The combination of MPCD, better compression technology, and an ever-increasing channel count, will drive video on demand deployments, whether via traditional broadcast and pay TV platforms, or over the internet or mobile networks.

The #8 ranked trend in the 2015 BBS Broadcast Industry Global Trend Index is the “transition to HDTV operations.

The transition to HDTV has been a huge driver of broadcast technology spending for more than a decade, but 2015 BBS respondents report that it continues to decline in terms of future commercial importance to their organizations.  In 2015, the technology required for the transition to HDTV is well understood by the majority of the market, even those who have not yet made the transition.

Despite its gradual decline in the 2015 BBS Broadcast Industry Global Trend Index rankings, we believe that the HD transition will continue to be one of the most important industry drivers over the coming years. There are a number of reasons for this, but the most important is that there is still a long way to go in the HD transition on a global basis. Indeed, our research shows that 2014 was the first year the total penetration of HDTV infrastructure surpassed the 50% mark for the global market.

Nevertheless, with the transition to HD having been a critically important driver for so many years, it begs the question of what’s next — as broadcast technology end-users in developed markets approach the completion of their HD transition, where does their focus (and spending) shift?

The “move to automated workflows” is ranked #9 in the 2015 BBS Broadcast Industry Global Trend Index

Better compression technology and lower cost integrated playout platforms (such as “channel-in-a-box”), will facilitate an ongoing proliferation of new TV channels.  This will in turn drive a focus on bringing highly automated operations to channel playout and master control environments. Thus we expect to continue to see a strong interest in the “move to automated workflows” over the next several years.  Automated workflows are also seen as drivers of efficiency.

While efficiency is undoubtedly very important to end-users, actually making money from new on-line channels has driven a significant increase in focus on content monetization via “targeted advertising,” which is ranked #10 in the 2015 BBS Broadcast Industry Global Trend Index.

“Remote production,” which is ranked #11 in 2015 BBS Broadcast Industry Global Trend Index is another trend that is focused on efficiency.  Through the use of remote production, broadcasters can lower their costs of producing live events, whether a small local soccer match or the World Cup.  Our research suggests that despite the potential for savings using “remote production” approaches for high-profile events, end-users are not yet comfortable adopting these approaches given the mission critical nature of the associated productions.  Therefore, the greater adoption for remote production is lower-tier events with inherently constrained revenue opportunities.

Similarly, broadcasters and media companies can achieve enormous cost-savings through the trend ranked #12 in the 2015 BBS Broadcast Industry Global Trend Index, “centralizing operations,” including playout and transmission.  A relevant example of centralized operations is the North American sporting leagues (including MLB, NFL, and the NBA) creating central facilities to handle the responsibility of in-game replays.

Although it’s towards the bottom of the rankings at #13, “analog switch-off” is very important for those regions where it’s happening today – primarily as mandated by local governments.  Our research shows that analog switch-off (also called “digital switch-over” in some territories) has driven huge waves of CapEx in those markets where it has already occurred.

As with previous years, the following trends were ranked towards the low-end of the Index: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations”, “3D TV” and “green initiatives.

 

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The information in this article is based on select findings from the 2015 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2015 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Granular analysis of these results is available as part of various paid-for reports based on the 2015 BBS data set. For more information about this report, please contact Devoncroft Partners

 

© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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Related Content

2015 Big Broadcast Survey (BBS) Reports Now Available

The 2015 Big Broadcast Survey

Download New Devoncroft Partners Report: NAB 2015 – Observations and Analysis of the Media Technology Industry

New Devoncroft Report Available for Download: IBC 2015 – Observations & Analysis of the Media Technology Industry

The 2014 BBS Broadcast Industry Global Trend Index

Devoncroft Research: IBC 2014: Observations and Analysis of Broadcast and Media Technology Industry (free 52 page report, registration required)

The 2013 BBS Broadcast Industry Global Trend Index

The 2012 BBS Broadcast Industry Global Trend Index

The 2011 BBS Broadcast Industry Global Trend Index

The 2010 BBS Broadcast Industry Global Trend Index

The 2009 BBS Broadcast Industry Global Trend Index

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There’s a Lot of Talk About Cloud Technology in Media & Entertainment, But What’s Actually Being Deployed?

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Sep 30 2014

This is the second in a series of articles about some of the findings from Devoncroft’s 2014 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2014 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry.

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There’s no question that cloud technology is a hot topic in the media and entertainment industry.

Indeed, it seems that these days you can’t read anything about industry technology trends (in broadcast or any other industry for that matter), NAB or IBC Show wrap-up piece, and/or manufacturer white paper, without coming across some mention of “the cloud.”

We see this in our own research too.

In the 2014 Devoncroft BBS Broadcast Industry Global Trend Index, “Cloud Services / Cloud Technology” was ranked the #5 in terms of the industry trends that are most important commercially to broadcast technology end-users world-wide.

This indicates that while there continues to be skepticism (not to mention security concerns) about cloud technology, the acceptance of (or at least the willingness to consider) cloud technology and services increased rapidly in 2014.

For example, data from the Devoncroft 2014 Big Broadcast Survey (BBS) Global Market Report shows that Cloud Services / Cloud Technology had one of the largest year-over-year percentage increases in terms of broadcast technology end-user project spending, when compared to wide variety of other capital projects.

So while there is still a great deal of hype about cloud in media and broadcast, there also appears to be genuine interest on the part of buyers to actually deploy technology in the cloud.

But what are buyers of broadcast technology actually planning to deploy in the cloud, and do they actually trust cloud technology?

To find out we asked participants in our 2014 Big Broadcast Survey (BBS) what they have already deployed, or plan to deploy in the cloud over the next 2-3 years.

Since we typically get about 10,000 people in 100+ countries participate in the BBS (thanks to all who participated, we really appreciate the time you spent sharing your feedback and opinions), we’ve gathered a lot of data on this and many other topics.

As simple example is shown in the “word cloud” below, which provides a graphical representation of how the many thousands of broadcast technology end-users who participated in the 2014 BBS responded to this simple question:  “what have already deployed in the cloud, or plan to deploy in the cloud over the next 2-3 years?”

Please note that the chart shown below is derived from “free-text” answers received in 10 separate languages from the many thousands of 2014 BBS respondents, so there is a lot going on in this diagram.

The free-text responses from 2014 BBS participants were used to create the “word cloud” shown below, whereby the font size of each term was made larger based on how often it was mentioned by 2014 BBS respondents (the colors do not mean anything, but they are pretty).

 

 

2014 BBS -- Likely Cloud Deployments in Broadcast Over Next 2-3 Years (small)

 

 

Although the data in this chart just scratches the surface in terms of the overall scope of opinions captured in the 2014 BBS, it’s a useful illustration of what broadcast technology buyers are thinking about actually deploying in the cloud.

It’s probably not surprising to most readers that “storage” was the use-case mentioned most often by 2014 BBS participants. The combination of low-cost digital acquisition technology, ever-increasing shooting ratios, and the desire to monetize content assets over multiple distribution platforms is driving the need for more storage (both on and off-premise). As one vendor told me recently, “the one thing I can tell you about content archives is that they are not getting smaller every day.”

More interesting, is that when you compare the above diagram with how last year’s BBS respondents answered this same question, is appears that there is more consensus beginning to emerge about media use-cases for cloud technology beyond the obvious.

In previous years, BBS respondents also reported that storage was one of the most important things they planned to deploy in the cloud.  However, after storage, the next most important response was typically “I Don’t Know.”

While there are still some BBS respondents who remain unsure about their cloud deployment plans, there are now many fewer, and it appears that in 2014 broadcast technology end-users are more serious than ever about deploying cloud technology.

In 2014, commonly cited use-cases for media and entertainment cloud deployments include streaming, archiving, editing, transcoding, and content distribution.

It’s also interesting to see specific vendors (including Adobe, Amazon AWS, Apple, and Dropbox) being frequently mentioned as being “the thing” that will be deployed in the cloud. This may indicate that technology buyers are looking to these vendors to provide them anything from specific cloud-based tools, to a complete end-to-end cloud solution.

Leaving aside specific technologies and vendors, sometimes it’s more useful to “zoom out to a 10,000 foot view” of the potential deployments of cloud technology in the professional media and entertainment industry.

Considered from this perspective, we believe that more significant than the technologies and vendors mentioned in the above chart, is the fact that cloud technology is being seen as increasingly important by major broadcasters and media companies.

There is plenty of evidence to support this premise, including several recently announced end-user initiatives and many discussions about creating a “virtualized broadcast infrastructure” in order to drive greater efficiencies. If this is the case, there are significant implications for all involved in the media supply chain, including both vendors and end-users.

Much more information about the attitudes of broadcast technology buyers towards cloud technology, and what broadcast technology buyers are likely to actually deploy in the cloud is available from Devoncroft Partners as part of our 2014 BBS Global Market Report. This report also includes information about what technologies end-users are planning to deploy in the cloud, when they are planning to deploy them, and what efficiencies they hope to achieve by doing so.

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Related Content:

2014 Big Broadcast Survey (BBS) Reports Now Available

2014 Broadcast Industry Market Research from Devoncroft Partners

Devoncroft Research: IBC 2014: Observations and Analysis of Broadcast and Media Technology Industry (free 52 page report, registration required)

2014 BBS: Ranking the Most Important Trends in the Broadcast Industry, Based on Commercial Importance to End-Users

2013 BBS: With All the Hype About Cloud, What Are Media Organizations Actually Going to Deploy?

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Ranking the Most Important Trends in the Broadcast Industry, Based on Commercial Importance to End-Users

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Sep 29 2014

This is the first in a series of articles about some of the findings from Devoncroft’s 2014 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2014 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry.

 

Measuring the Most Important Trends in the Broadcast and Digital Media Technology Industry

Each year, Devoncroft Partners conducts a large-scale global study of the broadcast industry called the Big Broadcast Survey (BBS).  Nearly 10,000 broadcast professionals in 100+ countries participated in the 2014 BBS, making it the most comprehensive study ever done in the broadcast industry.

One of the key outputs from the BBS is the annual BBS Broadcast Industry Global Trend Index. This is a ranking of the broadcast industry trends that are considered by BBS respondents to be the most commercially important to their businesses in any given year.

In order to ensure that the trends we measure each year in our research are the most relevant to the industry, we spend a considerable amount of time seeking feedback about the structure of our reports from a wide variety of industry professionals.

As part of this process, the composition of the BBS Broadcast Industry Global Trend Index is reviewed each year in conjunction with Devoncroft clients, broadcast technology end-users, and a variety of domain experts.  New trends are added to the Index when BBS stakeholders believe that the value of this additional trend information outweighs the resulting distortion of the year-over-year comparisons.

Based on the input we received during the planning stages of the 2014 BBS project, it was decided that the following two trends should be added to the list of trends included in the composition of the 2014 BBS Broadcast Industry Global Trend Index:

  • 4K / UHD
  • Remote Production

 

The benefit of this change is that we were able to capture a significant amount of information about information about the perceptions of 4K/UHD and remote production, including deployment plans.

The downside of this approach is that the inclusion of new trends will almost certainly cannibalize the rankings of other trends in our Index. Therefore, it is slightly more complicated to make a 1:1 comparison of how trends were ranked in 2014 versus 2013 across different demographics.

 

The 2014 BBS Broadcast Industry Global Trend Index

To create the 2014 BBS Broadcast Industry Global Trend Index, we presented BBS respondents with a list of 18 industry trends and asked them to tell us which one trend they consider to be “most important” to their business, which one trend they consider to be “second most important” to their business, and which other trends (plural) they consider to be “also very important.”

We then apply a statistical weighting to these results, based on how research participants ranked the commercial importance of each trend.

Please note that our goal from this question is to help clients gain insight into the business drivers behind the respondent’s answer. Therefore, respondents were asked to rank these trends in the context of the commercial importance to their business, rather than “industry buzz,” or “cool technology,” or marketing hype.

The table below shows the 2014 BBS Broadcast Industry Global Trend Index.

 

2014 Devoncroft BBS Broadcast Industry Global Trend Index

 

Keep in mind that this chart shows a measure of what people say is important to the future of their businesses, not what they are doing now, or where they are making money today.  These topics will be addressed in future posts.

Please note that this chart shows a weighted index, not a measure of the number of people who said which trend was most important to them.

Also, please note that this chart measures the responses of all non-vendors who participated in the 2014 BBS, regardless of company type, company size, geographic location, job title etc.  Thus the responses of any demographic group such as a particular company type or geographic location may vary widely from the results presented in this free summary information.

The fact that multi-platform content delivery (MPCD) is considered by respondents to be the industry trend that is most important commercially to their business jumps off the page, and is perhaps not surprising, given the rise of on-demand video platforms, consumer mobility, and sales of smartphones and tablets.  Indeed, across multiple studies, research participants have repeatedly told us that multi-platform content delivery is the trend that is most commercially important to their business over the next several years.

However, our discussions with broadcasters, content owners, and technology vendors indicate that despite the obvious fact that the way content is delivered and consumed has changed forever, this has not yet translated into profitable revenue streams for end-users.  There are a number of reasons why this is the case, and these have significant implications for content owners, broadcasters, and technology vendors.

These will be addressed in future posts, as well as on the Devoncroft website.

Although multi-platform content delivery is by far seen as the most important trend in 2014, there are quite a few other interesting things to consider in the above chart.

Since the first BBS Broadcast Industry Global Trend Index was published in 2009, “multi-platform content delivery,” “file-based / tapeless workflows,” “IP networking and content delivery” and transition to HDTV operations” have been the top ranked trends.  However their relative position has shifted dramatically.  For example, in 2009, the transition to HD operations was the #1 ranked trend globally, and MPCD was ranked #4.  In 2014, these were ranked #6 and #1 respectively.

For a number of years the transition to HDTV operations has been a major driver of end-user technology budgets, and therefore technology product sales. The HD transition continues to be and is likely to remain one of the strongest drivers of broadcast industry revenue, particularly in emerging markets, but has this year dropped to the #6 position on a global basis.

We provide significant coverage of the global transition to HDTV operations in the 2014 BBS Global Market Report (report available for purchase). This includes a granular breakdown of the current and projected future progress that end-users have made in their transition to HD, as well as the upgrade plans for more than a dozen product categories including cameras, switchers, routers, servers, graphics, encoders, communication links, and encoders. We’ll also be publishing more information about project-based spending and the HD transition later in this report, as well as on the Devoncroft website.

Another trend that has become increasingly more important over the past several years is “IP networking & content delivery,” which is ranked as the #2 most important trend in the 2014 BBS Global Trend Index.

The move to IP-based infrastructure become increasingly important as broadcast technology buyers continue to look for efficiencies as they transition to new technical platforms and business models.  In 2014, the move to IP-based infrastructure took on a new sense of urgency as buyers began to seek ways to implement IP-based systems in broadcast operational environments.

With new standards (e.g. SMPTE 2020-6), new market entrants (e.g. Arista Networks), and a high-profile joint task force on networked media (JT-NM), sponsored by the EBU, SMPTE, and VSF; the move to IP not only looks more and more inevitable, it is also likely to be a major industry driver over the mid to long-term.  As a result, we believe that the coming move to IP (which is still at least a year or two away in practice) has profound implications for both broadcast technology buyers and suppliers.

The move to IP is driven by an ever-increasing desire for broadcast technology buyers to gain operational efficiencies.  We believe this trend is set to accelerate, and will continue to be a strong macro driver of the overall industry for the next several years, as broadcasters continue to deploy new workflows.

The trend ranked #3 in the 2014 BBS Global Trend Index, “file-based / tapeless workflows,” is another indication of the importance of increased efficiency for broadcast technology end-users.  This trend has accelerated as the transition to HDTV (ranked #6 this year) begins to wind down in developed markets around the world.

Over the past several years, we’ve observed a pattern whereby broadcasters, who have invested considerable time, effort, and money into transitioning their operations to HD, begin to shift their focus towards increasing the efficiency of their operations.

Over time, efficiency has become a key driver of broadcast technology purchasing.  In fact, our research shows that in many cases, increased operational efficiency and cost savings are more important than cutting-edge technology.

This is because the economics of the entire industry have changed – because of MPCD and other factors – and as a result, end-users must change their cost structure (radically in some cases) in order to generate sustained profitability into the future.

This has implications for the broadcast industry in terms of both workflows and product procurement, and as a result, the importance of both file-based workflows and “IP networking & content delivery” has increased as broadcast technology buyers continue to look for efficiencies as they transition to new technical platforms and business models.  The desire for broadcast technology buyers to gain operational efficiencies will likely continue to be a strong macro driver in 2014, as broadcasters continue to deploy new workflows.

The trend ranked #4 in the 2014 BBS Global Trend Index is “4K / UHD.

2014 is the first year that we have included 4K / UHD as a component of the BBS Global Trend Index. It was added based on feedback from our clients, readers, and stakeholders.  The fact that 4K / UHD is ranked #4 in the first year of its inclusion in the Index demonstrates that these requests were well-founded.

Although 4K / UHD is still in its early phases of deployment, many in the industry see it as the next major driver of infrastructure upgrades – similar to the transition to HD a decade ago.

While there is no doubt that 4K / UHD is a very important developments, we are skeptical that it will have the same impact on the industry as the transition to HDTV operations, which drove a massive wave of technology spending that lasted more than a decade.

Although episodic and documentary content has or will soon move to 4K/UHD acquisition and archive (because it extends the useful life of content assets), it will take time for 4K/UHD to move into mainstream live production environments such as news and sports.  One reason for this is that it is still complex and expensive to create an entire live event in 4K/UHD, compared to today’s HD broadcast.  Uncompressed 4K/UHD requires real-time processing at 12 Gbps, and the full production chain is not yet widely available.  Another critical issue is that most 4K/UHD capable cameras utilize large format single sensors and cine-style PL-mount lenses. While the shallow depth-of-field produced by these acquisition systems is a perfect match for theatrical or drama production, it causes problems in live sports production, where depth-of-field is important to keep critical action sequences in constant focus.

Nevertheless, there’s no doubt that 4K/UHD is driving strong interest and excitement in the industry.  However, it remains to be seen whether it will become a mainstream technology driver as HD has been, or whether it will go the way of 3D production, which caused huge excitement in 2010 before being relegated to near-non-existence just a few years later.

Cloud computing / cloud based services,” is the #5 ranked trend (maintaining the same position as in 2013).

It seems that you can’t read anything about technology these days (broadcast or otherwise) without coming across some mention of “the cloud.”  So why is something that is apparently so important to so many people not ranked higher?

For the past several years, it was apparent that there was not a clear understanding of how cloud technology would be deployed in the broadcast environment, and what benefits it would bring.  This is still the case in many quarters in 2014, but this year our research shows that while there continues to be skepticism about the cloud (not to mention security concerns), the acceptance of (or at least the willingness to consider) cloud technology and services increased rapidly in 2014.

Indeed the Devoncroft 2014 BBS Global Market Report shows that Cloud Services / Cloud Technology is one of the fastest growing areas of project spending in the broadcast industry in 2014. This (paid) report also includes information about what technologies end-users are planning to deploy in the cloud, when they are planning to deploy them, and what efficiencies they hope to achieve by doing so.

For example, data from the Devoncroft 2014 BBS Global Market Report shows that Cloud Services / Cloud Technology has become one of the fastest growing areas of project spending in the broadcast industry this year.

Significantly more information about the attitudes of broadcast technology buyers towards cloud technology, and what broadcast technology buyers are likely to actually deploy in the cloud is available from Devoncroft Partners.

The #6 ranked trend in the 2014 BBS Broadcast Industry Global Trend Index is the “Transition to HDTV Operations.

The transition to HDTV has been a huge driver of broadcast technology spending for more than a decade, but 2014 BBS respondents report that it is declining in terms of future commercial importance to their organizations.  In 2014, the technology required for the transition to HDTV is well understood by the majority of the market, even those who have not yet made the transition.

Despite its gradual decline in the 2014 BBS Broadcast Industry Global Trend Index rankings, we believe that the HD transition will continue to be one of the most important industry drivers over the coming years. There are a number of reasons for this, but the most important is that there is still a long way to go in the HD transition on a global basis. Indeed, our research shows that 2014 is the first year that the total penetration of HDTV infrastructure has surpassed the 50% market for the global market.

Nevertheless, with the transition to HD having been a critically important driver for so many years, it begs the question of what’s next — as broadcast technology end-users in developed markets approach the completion of their HD transition, where does their focus (and spending) shift?

A review of the 2014 BBS Broadcast Industry Global Trend Index seems to indicate the answer lies in products and services that facilitate increased operational efficiency, and new revenue streams.

“Improvements in compression efficiency,” which is ranked #7 in the 2014 BBS Broadcast Industry Global Trend Index is consistent with the desire for increased efficiency. With content distribution models having migrated from single linear broadcast channels, to multi-channel Pay TV playout, to a totally on-demand environment, high quality compression is a critical success factor for broadcasters and content playout platforms.

A plethora of new channels, and the desire for simultaneous bandwidth saving and increased image quality for MPCD services have driven an increasing focus on high quality compression systems. For the past several years this has resulted in better MPEG-2 and H.264 compression products for primary distribution, contribution, and redistribution to consumers. H.265, aka HEVC compression technology holds the promise of further reducing the bandwidth required to deliver high quality images, particularly for 4K/UHD channels.  However, it’s still early days for HEVC, and widespread deployments are still a year or two away.  Nevertheless, it’s clear that for many end-users of broadcast technology, HEVC could be a game-changer.

In addition to creating greater efficiencies, end-users are also looking for ways to increase their revenue in an environment where the economic model of the industry is changing dramatically.  Thus “video-on-demand,” which is ranked #8 in the 2014 BBS Broadcast Industry Global Trend Index, will continue to be a strong driver for content owners, media companies and broadcasters.  The combination of MPCD, better compression technology, and an ever-increasing channel count, will continue to push video on demand deployment, whether via traditional broadcast and pay TV platforms, or over the internet or mobile networks.

The “move to automated workflows” is ranked #9 in the 2014 BBS Broadcast Industry Global Trend Index

Better compression technology and lower cost integrated playout platforms (aka “channel-in-a-box”), will facilitate an ongoing proliferation of new TV channels.  This will in turn drive a focus on bringing highly automated operations to channel playout and master control environments. Thus we expect to continue to see a strong interest in the “move to automated workflows” over the next several years.  Automated workflows are also seen as drivers of efficiency.

While efficiency is undoubtedly very important to end-users, actually making money through the monetization of the new automated channels that are coming on-line has driven a significant increase in focus on content monetization via “targeted advertising,” which is ranked #10 in the 2014 BBS Broadcast Industry Global Trend Index.

“Remote production,” which is ranked #11 in 2014 BBS Broadcast Industry Global Trend Index is another trend that is all about efficiency.  Through the use of remote production, broadcasters can lower their costs of producing live events, whether they are as small as a local soccer match or as large as the World Cup.

Similarly, broadcasters and media companies can achieve enormous cost-savings through the trend ranked #12 in the 2014 BBS Broadcast Industry Global Trend Index, “centralizing operations,” including playout and transmission

Although it’s towards the bottom of the rankings at #13, “analog switch-off” is very important for those regions where it’s happening today – primarily as mandated by local governments.  Our research shows that analog switch-off (also called “digital switch-over” in some territories) has driven huge waves of CapEx in those markets where it has already occurred.

As with previous years, the following trends were ranked towards the low-end of the Index: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations”, “3D TV” and “green initiatives.

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The information in this article is based on select findings from the 2014 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2014 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Granular analysis of these results is available as part of various paid-for reports based on the 2014 BBS data set. For more information about this report, please contact Devoncroft Partners

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Related Content

2014 Big Broadcast Survey (BBS) Reports Now Available

2014 Broadcast Industry Market Research from Devoncroft Partners

Devoncroft Research: IBC 2014: Observations and Analysis of Broadcast and Media Technology Industry (free 52 page report, registration required)

The 2013 BBS Broadcast Industry Global Trend Index

The 2012 BBS Broadcast Industry Global Trend Index

The 2011 BBS Broadcast Industry Global Trend Index

The 2010 BBS Broadcast Industry Global Trend Index

The 2009 BBS Broadcast Industry Global Trend Index

 

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Business Model Questions Linger As Broadcasters Shutter 3D Offerings in Favor of Multi-Screen Services

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Jul 05 2013

Earlier this week the BBC announced that it will broadcast select matches from the Wimbledon Championships in 3D this year.  At that time, Kim Shillinglaw, Head of BBC 3D, said: “We’re delighted to provide live 3D coverage from the biggest matches of this year’s Wimbledon. Major UK sporting events are a big part of our trials with 3D content and this allows us to build on our work from previous Wimbledon Championships and the London 2012 Olympics.”

Now, Broadband TV News reports that the BBC is taking “a three-year holiday from the development of 3D programming with the corporation’s head of 3D admitting the UK public had not taken to the format.”

Broadband TV News quotes the BBC’s Shillinglaw saying “Watching 3D is quite a hassly experience in the home. You have got to find your glasses before switching on the TV. I think when people watch TV they concentrate in a different way. When people go to the cinema they go and are used to doing one thing – I think that’s one of the reasons that take up of 3DTV has been disappointing.”

Shillinglaw’s sentiments echo the statement made by ESPN last month and first reported by the Sports Video Group (SVG) that the leading US sports network was discontinuing its ESPN 3D service “due to limited viewer adoption of 3D services to the home.” ESPN went on to say that it plans on committing the resources currently assigned to 3D production to “other products and services that will better serve fans and affiliates,” specifically citing 4K (UHDTV) as an example.

At the time of the ESPN announcement, SVG said that the discontinuation of ESPN 3D raises serious questions regarding the future of 3D sports programming in the U.S. While Europe — especially the UK — has seen continued interest in live 3D sports, American consumers failed to adopt the format at a high rate.” The BBC’s announcement implies that UK consumer appetite for 3D is as lukewarm as it has been in North America, making it impractical for even a publicly funded broadcaster to continue with the format.

A remaining piece of the 3D puzzle is the 2014 FIFA World Cup, which will probably be the most watch global event of the year.  According to SVG, HBS (Host Broadcast Services), which will produce the world feed for the 2014 World Cup in Brazil, has yet to confirm whether the tournament will be produced in 3D.

 

Research Shows Commercial Importance of 3D Down, Multi-Screen Up

These announcements from BBC and ESPN are consistent with the findings of the Big Broadcast Survey (BBS), our annual study of the global broadcast industry.  In particular, the 2013 BBS Broadcast Industry Global Trend Index, reveals that multi-platform content delivery is once again the top industry trend for broadcast technology end-users worldwide, while 3D lags far behind in terms of its commercial importance to broadcast professionals.

Not only have research participants consistently told us that 3D lags other industry trends in terms of its commercial importance to their businesses, we’ve also found that 3D has become increasingly less important each year for the past several years.

For example, the chart bellows shows the chart below shows a comparison of the BBS Broadcast Industry Global Trend Index from 2012 and 2013.  It measures changes in how end-users ranked the commercial importance of industry trends on a year-over-year basis.

 

2013 BBS -- 2013 BBS Broadcast Industry Global Trend Index -- Red Box Around 3D (small)

 

Note that in this chart, 3D had the largest reported year-over-year percentage decline in commercial in both between 2012 and 2013.  This was also the case last year.

However, the above chart also demonstrates that while interest in 3D has waned, multi-platform content delivery is and continues to be the dominant trend in the broadcast industry, with more research participants citing it than any other trend as being most important commercially to their business.

The BBS’s plans for Wimbledon are further evidence of this.  The broadcaster said that it will make coverage of the tournament available on an increasing number of platforms, including ten live streams that will be available to PCs, mobiles, tablets and connected TVs.  The BBC will also offer three streams for “Red Button” for viewers on cable and satellite and Digital Terrestrial TV.

 

What about the business model?

Our research, as well as studies from many other firms, leaves no doubt that the popularity of multi-screen services in increasing.

However, it’s another matter to create a commercially successful business model in an environment where audiences are fragmenting, additional content preparation costs are required, and bandwidth providers charge steep fees for unicast delivery of video stream to consumers.

Delivering multi-screen services to consumers is a relatively straightforward process from a technical perspective. Monetizing content on multiple platforms, devices, and use cases is a different matter.

For example, in March 2013 Broadcasting and Cable magazine reported that one panelist at Next TV Conference said that multi-platform content monetization is still a ‘train wreck,’ although other did express “great optimism about the leaps technology will take in coming years.”

In our conversations with broadcasters, Devoncroft analysts have found that many broadcasters and media companies are indeed finding it a challenge to create a sustainable multi-screen business model with a margin profile similar to their traditional business.

The issue is that the shift to multi-platform has dramatically altered the economic model of the TV business. There are a number of reasons and examples why this is the case, but the end-result is that many broadcasters and media companies feel that in order to thrive in this new environment, they must radically change their cost structure.

The resulting decision these organizations will take will have significant implications for content owners, broadcasters, and technology vendors.

We’ll be addressing some of these in future posts on this website.
Some of the information in this article is based on select findings from the 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Unless otherwise specified, all data in this article measures the responses of all non-vendor participants in the 2013 BBS, regardless of factors such as organization type, organization size, job title, purchasing and geographic location. Please be aware that responses of individual organization types or geographic locations may be very different. Granular analysis of these results is available as part of various paid-for reports based on the 2013 BBS data set. For more information about this report, please contact Devoncroft Partners

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Related Content:

Broadband TV News: BBC puts 3D development on hold

BBC Press Release: BBC confirms 3D coverage plans for Wimbledon

Sports Video Group: ESPN To Discontinue ESPN 3D by Year’s End  

Broadcasting & Cable: Monetization Still a ‘Train Wreck,’ But Shows Signs of Clearing

The 2013 Big Broadcast Survey (BBS) – overview of available reports, including covered brands and product categories

Largest Ever Study of Broadcast Market Reveals Most Important Industry Trends for 2013

Tracking the Evolution of Broadcast Industry Trends 2012 – 2013

Analyzing Where Money is Being Spent in the Broadcast Industry – The 2013 BBS Broadcast Industry Global Project Index

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© Devoncroft Partners 2009 – 2013. All Rights Reserved.

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Broadcast Technology Products Being Evaluated for Purchase in 2013 – 2014

broadcast industry trends, broadcast technology market research, Broadcast Vendor Brand Research, Quarterly Results | Posted by Joe Zaller
Jul 03 2013

This is the fourth in a series of articles about some of the findings from Devoncroft’s 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. 

 

Previous articles about the 2013 BBS discussed the most important broadcast industry trends, how the relative commercial importance of broadcast industry trends have changed over time, and where money is currently being spent in the broadcast industry.

This article expands on the findings of the 2013 BBS Broadcast Industry Global Project Index by drilling down into the specific product categories that are being evaluated for purchase this year by our global sample of nearly 10,000 broadcast technology end-users in 100+ countries.

We presented research participant with a list of relevant product categories and asked to indicate which ones they are currently evaluating for purchase.

The results are shown in the chart below.

 

2013 BBS -- Product Being Evaluated for Purchase

 

In 2013 it is likely that production technology – such as video editing systems, camera-related products, and audio technology – will be in demand as broadcast professionals continue to upgrade their facilities to HDTV operations.

The new studios, OB vans, and channels that broadcasters have planned and budgeted for will drive the evaluation and purchase of a wide variety of equipment including studio cameras, production switchers, multiviewers, automation, storage, and transmission encoders. As always, test & measurement products will be required for these new facilities.

Strong interest in multi-platform content delivery is driving interest in products and services such as ingest/ streaming/ transcoding and online video delivery platforms.

The ongoing transition to file-based/tapeless workflows will drive the evaluation and purchase of products such as near-line/off-line/archival storage, production servers, and playout automation.

All of the above will likely benefit software-oriented systems such as workflow / asset management, library/storage management, and broadcast business management systems. These products help broadcast technology increase their operational efficiency by facilitating content storage & search; linear and multi-platform playout & distribution; and of course monetization.

 

The information in this article is based on select findings from the 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Unless otherwise specified, all data in this article measures the responses of all non-vendor participants in the 2013 BBS, regardless of factors such as organization type, organization size, job title, purchasing and geographic location.  Please be aware that responses of individual organization types or geographic locations may be very different. Granular analysis of these results is available as part of various paid-for reports based on the 2013 BBS data set. For more information about this report, please contact Devoncroft Partners

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Related Content:

The 2013 Big Broadcast Survey (BBS) – overview of available reports, including covered brands and product categories

Largest Ever Study of Broadcast Market Reveals Most Important Industry Trends for 2013

Tracking the Evolution of Broadcast Industry Trends 2012 – 2013

Analyzing Where Money is Being Spent in the Broadcast Industry – The 2013 BBS Broadcast Industry Global Project Index

Devoncroft Partners: 2013 Broadcast Industry Market Research Findings

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© Devoncroft Partners. All Rights Reserved.

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Analyzing Where Money is Being Spent in the Broadcast Industry – The 2013 BBS Broadcast Industry Global Project Index

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Jul 01 2013

This is the third in a series of articles about some of the findings from Devoncroft’s 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. 

 

In a previous article, we published the 2013 BBS Broadcast Industry Global Trend Index, which shows how a global sample of nearly 10,000 broadcast professionals ranked a set of broadcast industry trends in terms of the commercial importance of each one to their business.

This was followed by a post called Tracking the Evolution of Broadcast Industry Trends 2012 – 2013, which examined how the relative commercial importance of broadcast industry trends have changed over time.

Rather than looking at industry trends, which are often an indicator of what might happen in the future, this article examines what technology products and services are actually being purchased today by broadcasters and media companies globally.

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The 2013 BBS Broadcast Industry Global Trend Index (which can be found here) showed that the top-ranked broadcast industry trend in 2013 is “multi-platform content delivery.”  Other important trends include “file-based workflows,” “IP networking and content delivery,” and the “transition to HDTV operations.”

The 2013 BBS Trend Index includes a mix of current and future commercial priorities, some of which have already been widely deployed, on a wide scale, some of which are currently being trialed, and others which have not yet been widely implemented. Industry trends evolve and change over time, so tracking this evolution is helpful to better understand what customers are discussing and thinking about implementing in the future.

However, a top ranking in an industry trend Index does not necessarily translate into where broadcast technology buyers are actually spending their budgets in 2013 and 2014. Therefore, it’s important to make a clear distinction between what broadcast customers are thinking and talking about doing in the future (trends), and where they are spending their technology budgets today (projects).

Technology spending in the broadcast industry is typically project-based. Real (budgeted) projects are where broadcast technology budgets are being spent today, not just what people are talking about doing in the future.

Capital projects come in many forms.  They might include international elections, sporting championships, new services designed to attract incremental revenue, and the long-term planned capital upgrades of broadcast infrastructure and facilities.

In order to better understand this dynamic, we presented 2013 BBS participants with a list of 18 projects (determined based on feedback of BBS stakeholders), and asked them to indicate which of these projects they are currently in the process of implementing or have budgeted to implement within the next year.

Unlike industry trend data, which highlights what respondents are thinking/talking about doing in the future, this information provides direct feedback about what major capital projects are being implemented by broadcast technology end-users around the world, and provides useful insight into the capital expenditure plans of the industry.

Taken together, information about trends and projects collected in the 2013 BBS can be used to understand the difference between “trend and spend,” and/or hype and reality.

 

The 2013 BBS Broadcast Industry Global Project Index, shown below, measures the number of projects that research participants are currently implementing or have budgeted to implement.

2013 BBS -- 2013 BBS Broadcast Industry Global Project Index

 

Comparing the above chart with the 2013 BBS Broadcast Industry Global Trend Index illustrates the difference between what end-users are thinking and talking about (trends), and where they are actually planning to spend their budgets today (projects).

While “multi-platform content delivery” was this year’s top-ranked trend, when it comes to where money is actually being spent in 2013, more broadcast technology buyers said that they have budgeted for “upgrading infrastructure for HD/ 3Gbps operations” than any other project.

This finding is consistent with our previous research. Upgrading infrastructure for HD / 3Gbps operations has consistently been the top driver of broadcast technology spending for the past several years, and this is once again the case in 2013.

This year’s top project correlates directly with “transition to HDTV operations,” which was ranked #4 in the 2013 BBS Broadcast Industry Global Trend Index.

The projects ranked #3, #4, #5, #7, #9, and #12 in the 2013 BBS Broadcast Industry Global Project Index – “upgrading cameras,” “upgrading transmission & distribution capabilities;” “building new studios / OB vans;” “launching new channels;” and “upgrading newsroom operations” – are also related to the transition to HDTV operations. These new cameras, transmission upgrades, new studios, new channels, and upgraded news environments will almost certainly be at least HD capable, if not fully HD.

In some cases, industry trends and budgeted projects line up nicely. In others however, there are significant differences.

A good example of the latter is “multi-platform content delivery,” which has been the top-ranked trend in the BBS Broadcast Industry Global Trend Index since 2010, and dominated the Index this year.  However, the corresponding project measured in the chart above, “distribute and monetize content on multiple distribution platforms,” ranked #10 out of 18 in the 2013 BBS Broadcast Industry Global Project Index, significantly below items ranked much lower in the BBS Trend Index.

These findings are consistent with previous BBS studies, as well as our other research in the professional broadcast technology marketplace.

Despite strong interest in multi-platform content delivery, it appears that creating a sustainable (and profitable) business model for distributing and monetizing content on multiple digital distribution platforms has proven elusive to date for both end-users and technology vendors.

We have conducted numerous projects about multi-platform business models that involved interviewing senior executives from broadcasters and media companies. Although these executives immediately agree that getting to “multi-platform nirvana” is strategically important to their organizations, many readily admit that they have yet to find the right business model.

Many broadcasters and content owners believe that in order to achieve increased revenue and profitability in a multi-platform world, they must first dramatically increase their efficiency through the implementation of new workflows and technical systems, some of which do not yet exist.

This implies that there are likely to be significant opportunities in the future for broadcast technology vendors that are able to solve the technical, operational, and business challenges facing end-users who see multi-platform distribution and monetization as a critical part of their business strategy.

It also helps explain why “file-based/tapeless workflows” was ranked #2 in the 2013 BBS Trend Index, with many research participants saying it is the industry trend that is most important commercially to their businesses over the next few years.

Indeed, a number of capital projects are being implemented in 2013-14 are directly related to “file-based/tapeless workflows” trend. Examples of this are “cloud technology/cloud services,” “workflow / asset-management,” “archive-related projects,’ and “automating workflows.”

In particular, the #2 ranked project in 2013 — “install or enhance workflow / asset management system” – is an area where there has been a great deal of recent activity. Although it may seem that MAM has been set to become “the next big thing” for the past decade or so, it now appears that broadcasters are increasingly focusing on MAM deployments.

One reason for this could be that many end-users believe that in order to be profitable in a multi-platform world, they must significantly increase the efficiency of their operations, and broader use of MAM is seen as one part of solution.

Indeed, in a recent Devoncroft project, more than half of the senior executives from broadcasters and media companies we interviewed cited multi-platform content distribution as the factor that will drive the most change in their organizations over the next few years; and because of this, more than two-thirds predicted their spending on MAM and workflow tools will increase over the next two years.

The remainder of the 2013 BBS Broadcast Industry Global Project Index offers a mixed picture of project activity across the world, and includes everything from upgrading audio and newsrooms to migrating infrastructure from copper to fiber.

And as seen in the 2013 BBS Trend Index, some projects are being planned as the direct result of government or corporate mandates. “Prepare for analog switch-off” is the best example of this.  In the territories where governments have mandated a switch to digital broadcasting, tremendous planning and focus is being devoted to these projects, resulting in strong revenue for transmission and distribution-related products and services.

Interestingly, despite the fact that they may have the potential to deliver increased efficiencies and new revenue streams, some very large projects appear towards the bottom of this list. For example, “consolidate operations in regional hubs (centralcasting),” and “outsourced operations (playout),” are the bottom ranked projects in 2013. This is because although these are high value projects, they will be undertaken by a relatively small number of organizations — i.e. large broadcasters.  This highlights that the 2013 BBS Broadcast Industry Global Project Index is a graphic representation of the number of all planned projects across all respondents, regardless of organization type, size, or location.  It does not measure size, value, or relative commercial importance of planned projects.  Please keep this in mind when reading this information and interpreting these findings.

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The information in this article is based on select findings from the 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Unless otherwise specified, all data in this article measures the responses of all non-vendor participants in the 2013 BBS, regardless of factors such as organization type, organization size, job title, purchasing and geographic location.  Please be aware that responses of individual organization types or geographic locations may be very different. Granular analysis of these results is available as part of various paid-for reports based on the 2013 BBS data set. For more information about this report, please contact Devoncroft Partners

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Related Content:

The 2013 Big Broadcast Survey (BBS) – overview of available reports, including covered brands and product categories

Largest Ever Study of Broadcast Market Reveals Most Important Industry Trends for 2013

Tracking the Evolution of Broadcast Industry Trends 2012 – 2013

Devoncroft Partners: 2013 Broadcast Industry Market Research Findings

Previous Year: The 2012 BBS Broadcast Industry Global Project Index

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© Devoncroft Partners. All Rights Reserved.

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Tracking Changes in the Commercial Importance of Broadcast Industry Trends, 2012 – 2013

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Jun 26 2013

This is the second in a series of articles about some of the findings from Devoncroft’s 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. 

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In a previous article, we published the 2013 BBS Broadcast Industry Global Trend Index, which shows how a global sample of nearly 10,000 broadcast professionals ranked a set of broadcast industry trends in terms of the commercial importance of each one to their business.

This article compares how the relative commercial importance of these trends has changed over time, and looks specifically at what trends were ranked higher or lower in terms of commercial importance in 2013 versus 2012 by our global panel of research participants.

 

Why Tracking Movement of Trends is Important

Understanding changes in how technology buyers rank the relative commercial importance of industry trends provides important insight into what might be next for the industry.

Whereas it’s tempting to use historical sales data to try to determine what factors will drive industry CapEx in the future, it’s actually quite difficult to use the relative performance of a technology vendor in the past as predictor of the behavior of technology buyers in the future.

Broadcast industry CapEx tends to be project-based. Expenditure is typically contemplated based on business needs, and then deployed according to available resources. And yet, technology buyers must always be cognizant of a wide variety of factors, including technology evolution, business risk/reward, and even government intervention.

Changes to end-user rankings of the commercial importance of trends can be used to predict where technology expenditure may be headed in the future.

This is because industry trends drive capital projects, which in turn drives technology budgets, which in turn drives product purchase.  In other words, what technology buyers say is commercially important to their business in the future (i.e. trends) will likely turn into what they are budgeting for tomorrow (i.e. projects).

Therefore it’s useful to review how the relative importance of broadcast industry trends has changed over time, because it provides a preview of where technology purchases will be made in the future.

 

  • In 2009, the BBS Broadcast Industry Global Trend Index was dominated by the “transition to HDTV operations.”  “Multi-platform content delivery” was ranked #4 on this list.

 

  • The following year, in 2010, “multi-platform content delivery” had become the most important industry trend, narrowly eclipsing “file-based/tapeless workflows” (which were combined in the 2010 index) and the “transition to HDTV operations.”

 

  • By 2011, multi-platform content delivery began to dominant trend in the BBS Broadcast Industry Global Trend Index, ranking significantly higher than all other industry trends.  Analog-switch-off was added to the Index in 2011.

 

  •  Last year (2012) multi-platform content delivery continued to dominate the BBS Broadcast Industry Global Trend Index, and file-based workflows surpassed transition to HDTV operations for the first time.  Cloud computing/cloud-based services was added to the Index in 2012.

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The 2013 BBS Broadcast Industry Global Trend Index

To create the 2013 BBS Broadcast Industry Global Trend Index, we presented BBS respondents with a list of 16 industry trends and asked them to tell us which one trend they consider to be “most important” to their business, which one trend they consider to be “second most important” to their business, and which other trends (plural) they consider to be “also very important.”

We then apply a statistical weighting to these results, based on how research participants ranked the commercial importance of each trend, and use this information to create the BBS Broadcast Industry Global Trend Index, which is shown below.

2013 BBS -- 2013 BBS Broadcast Industry Global Trend Index

 

In 2013, “multi-platform content delivery” was ranked by research participants as being the most important industry trend – by an order of magnitude versus other trends included in the 2013 Index.  More information about the 2013 BBS Broadcast Industry Global Trend Index can be found here.

In the context of this article, it should be noted that trends included in the 2013 BBS Broadcast Industry Global Trend Index have not changed from the previous year.

The composition of the BBS Broadcast Industry Global Trend Index is reviewed each year in conjunction with Devoncroft clients, broadcast technology end-users, and a variety of domain experts.  New trends are added to the Index when BBS stakeholders believe that the value of this additional trend information outweighs the resulting distortion of the year-over-year comparisons.

Based on this input, it was decided not to make any changes to the composition of the 2013 BBS Broadcast Industry Global Trend Index. The benefit of this is that it’s easy to make a 1:1 comparison of how trends were ranked in 2013 versus 2012.  The downside is that some emerging trends such as 4K, bonded cellular, HEVC encoding, social TV etc., were not included in the 2013 Index.   However, these issues (and more) were included in other parts of the 2013 BBS, and there is a significant amount of available data on these subjects within various 2013 BBS reports.

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Comparing the Commercial Importance of Broadcast Industry Trends in 2013 Versus 2012 

The chart below shows a comparison of the BBS Broadcast Industry Global Trend Index from 2012 and 2013.  It measures changes in how end-users ranked the commercial importance of industry trends on a year-over-year basis.

 2013 BBS -- Comparison of 2012 and 2013 BBS Broadcast Industry Global Trend Index (white background)

 

MPCD, file-based/tapeless workflows, IP networking & content delivery, and the transition to HD operations have occupied the top four positions in the BBS Global Trend Index since its inception in 2009, although it is interesting to note there has been considerable movement in their position in the actual rankings.

While multi-platform content delivery (MPCD), was once again the top-ranked trend in 2013, it did decline slightly on a year-on-year basis versus the rest of the Index. Nevertheless, MPCD was ranked considerably higher in 2013 than any other trend, which was also the case in 2012.

 

Leaving aside the numerical rankings for the moment, other observable changes in the relative commercial importance of broadcast industry trends between 2012 and 2013 include:

  • Y-Y increases in the relative importance of “IP networking & content delivery,” “improvements in video compression efficiency,” “cloud computing/cloud-based services,” “move to automated workflows,”  “centralized operations,” “transition to 5.1 channel audio,” “outsourced operations,” and “green initiatives.”

 

  • Y-Y decreases in the relative importance “multi-platform content delivery,” “file-based/tapeless workflows,” “transition to HDTV operations,” “video on demand,” “targeted advertising,” “analog switch-off,” and “3D-TV”

 

Some of these changes are subtle, and do not necessarily imply that the relative importance of the trends have changed over time.  However, other movements in the Index do indeed impact the actual numerical position of each trend within the ranking.

 

 

Changes in Numerical Ranking in the BBS Broadcast Industry Global Trend Index

As shown below, there were some interesting changes in the numerical ranking of the trends in the 2013 Index versus the 2012 Index.

The column on the left of the table below shows the numerical rankings of trends in 2013. The number in parentheses to the right of each trend shows how it ranked in the 2012 BBS Index. Although there were no changes at the top and bottom of the 2013 Index versus the 2012 Index, there was movement in between.

2013 BBS -- Numerical Ranking Changes -  2012 and 2013 BBS Broadcast Industry Global Trend Index

 

 

Several trends were ranked more highly in 2013 than in 2012.  For example, IP networking & content delivery moved up one spot to the #3 ranking (eclipsing the transition to HDTV operations for the first time in the Index).

Other net gainers in numerical rankings include IP networking & content delivery, cloud computing/cloud-based services, centralized operations, transition to 3Gbps (1080p) operations, and transition to 5.1 channel audio; all of which show year-over year increases in the Index ranking.

Net decliners in 2013 versus 2012 include the transition to HDTV operations, video on demand, analog switch-off, and 3D-TV, which had the largest year-over-year percentage drop.

The table below provides a consolidated view of the relative movement in numerical rankings of broadcast industry trends between 2012 and 2013.

 

2013 BBS -- Chages of Relative Imporance of 2012 versus 2013 BBS Broadcast Industry Global Trend Index

 

So what does this all mean?

On a global basis, the strong showing of “file-based workflows,” coupled with a y-y decline in the commercial importance of the “transition to HDTV operations” implies that those broadcasters that have largely completed their HD transition are now focusing on introducing efficiencies that will ultimately lead to new sources of revenue.

Indeed, the continued domination of “multi-platform content delivery” and “file-based workflows,” combined with the increasing importance of “IP networking & content delivery” and “cloud computing/cloud-based services” demonstrates that in 2013 broadcast technology buyers will spend money to create operational efficiencies, while at the same time working to generate new revenue streams through multi-screen offerings.  However, it remains to be seen whether many broadcasters will be able to create sustainable profits from multi-platform offerings.

It should be noted that there may be significant regional variations in this data.  For example, the transition to HDTV operations is likely to remain a strong driver for those end-users who have not yet started, or substantially completed their migration to HD.  Likewise, although “analog switch-off” is ranked towards the bottom of the 2013 Index, it’s probably safe to assume this is a top priority in in those territories where governments have mandated a switch to digital broadcasting.

 

 

Turning Talk into Action – When do Trends Become Capital Projects?

There is a difference between recognizing that a trend is commercially important and having a business plan in place that capitalizes on that trend.  As stated previously, our view is that industry trends drive capital projects, which in turn drive technology budgets, which in turn drive product purchase.  In other words, what technology buyers say is commercially important to their business in the future (i.e. trends) will likely turn into what they are budgeting for tomorrow (i.e. projects).

The 2013 BBS Broadcast Industry Global Trend Index shows that monetizing content on multiple platforms remains the top objective for broadcast professionals in the year ahead.  However, many industry participants — on both the content and technology sides of the business — are still experimenting with their business models.

At some point these trends will drive capital projects, if they are not already doing so today.  When that happens they will become major drivers of technology spending in the broadcast industry.

In a future article, we’ll look at where money is being spent today in the broadcast industry.

 

 

The information in this article is based on select findings from the 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Unless otherwise specified, all data in this article measures the responses of all non-vendor participants in the 2013 BBS, regardless of factors such as organization type, organization size, job title, purchasing and geographic location. Please be aware that responses of individual organization types or geographic locations may be very different. Granular analysis of these results is available as part of various paid-for reports based on the 2013 BBS data set. For more information about this report, please contact Devoncroft Partners

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Related Content:

The 2013 Big Broadcast Survey (BBS) – overview of available reports, including covered brands and product categories

Largest Ever Study of Broadcast Market Reveals Most Important Industry Trends for 2013

The 2012 BBS Broadcast Industry Global Trend Index

Tracking the Evolution of Broadcast Industry Trends 2009 – 2012

The 2011 BBS Broadcast Industry Global Trend Index

The 2010 BBS Broadcast Industry Global Trend Index

The 2009 BBS Broadcast Industry Global Trend Index

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© Devoncroft Partners. All Rights Reserved..

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Largest Ever Study of Broadcast Market Reveals Most Important Industry Trends for 2013

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Jun 18 2013

This is the first in a series of articles about some of the findings from Devoncroft’s 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. 

 

Measuring the Broadcast Industry’s Most Important Trends

Each year, Devoncroft Partners conducts a large scale global study of the broadcast industry called the Big Broadcast Survey (BBS).  Nearly 10,000 broadcast professionals in 100+ countries participated in the 2013 BBS, making it the most comprehensive study ever done in the broadcast industry.

One of the key outputs from the BBS is the annual BBS Broadcast Industry Global Trend Index. This is a ranking of the broadcast industry trends that are considered by BBS respondents to be the most commercially important to their businesses in any given year.

In order to ensure that the trends we measure each year in our research are the most relevant to the industry, we spend a considerable amount of time seeking feedback about the structure of our reports from a wide variety of industry professionals including broadcasters, broadcast service providers, technology vendors, consultants, and domain experts.

In 2013 we kept the list of trends in this Index the same as in 2012.  This enables direct year-over-year comparisons of trends across different demographics.  It also means that we decided not to include certain “new” technology trends in the 2013 Index, including 4K, Ad-ID, connected TV, DSLR cameras, HEVC, second screen applications, SOA, and social TV.  However, we have covered each of these “new” technologies separately in the 2013 BBS project, and will be making this information available to clients through our published reports.

 

The 2013 BBS Broadcast Industry Global Trend Index

To create the 2013 BBS Broadcast Industry Global Trend Index, we presented BBS respondents with a list of 16 industry trends and asked them to tell us which one trend they consider to be “most important” to their business, which one trend they consider to be “second most important” to their business, and which other trends (plural) they consider to be “also very important.”

We then apply a statistical weighting to these results, based on how research participants ranked the commercial importance of each trend.

Please note that our goal from this question is to help clients gain insight into the business drivers behind the respondent’s answer. Therefore, respondents were asked to rank these trends in the context of the commercial importance to their business, rather than “industry buzz,” or “cool technology,” or marketing hype.

The table below shows the 2013 BBS Broadcast Industry Global Trend Index.

Keep in mind this is a measure of what people say is important to the future of their businesses, not what they are doing now, or where they are making money today.  We’ll address some of these topics in later posts.

Please note that this chart shows a weighted index, not a measure the number of people that said which trend was most important to them.  Also, please note that this chart measures the responses of all non-vendors who participated in the 2013 BBS, regardless of company type, company size, geographic location, job title etc.  Thus the responses of any demographic group such as a particular company type or geographic location may vary widely from the results presented in this article.

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2013 BBS -- 2013 BBS Broadcast Industry Global Trend Index

 

 

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The fact that multi-platform content delivery (MPCD) is considered by respondents to be the industry trend that is most important commercially to their business jumps off the page, and is perhaps not surprising, given the rise of on demand video platforms, consumer mobility, and sales of smartphones and tablets.  Indeed, across multiple studies, research participants have repeatedly told us that multi-platform content delivery is the trend that is most commercially important to their business over the next several years.

However, our discussions with broadcasters, content owners, and technology vendors indicate that despite the obvious fact that the way content is delivered and consumed has changed forever, this has not yet translated into profitable revenue streams for end-users.  There are a number of reasons why this is the case, and these have significant implications for content owners, broadcasters, and technology vendors.  We’ll be addressing some of these in future posts on this website.

Although multi-platform content delivery is seen by far as the most important trend in 2013, there are quite a few other interesting things to consider in the above chart.

Since the first BBS Broadcast Industry Global Trend Index was published in 2009, “multi-platform content delivery,” “file-based / tapeless workflows,” “IP networking and content delivery” and transition to HDTV operations” have been the top ranked trends.  However their relative position has shifted dramatically.  For example, in 2009, the transition to HD operations was the #1 ranked trend globally, and MPCD was ranked #4.  Today these rankings are reversed.

For a number of years the transition to HDTV operations has been a major driver of end-user technology budgets, and therefore technology product sales. The HD transition continues to be and is likely to remain one of the strongest drivers of broadcast industry revenue, particularly in emerging markets, but has this year dropped to the #4 position on a global basis.

We provide significant coverage of the global transition to HDTV operations in the 2013 BBS Global Market Report (report available for purchase). This includes a granular breakdown of the current and projected future progress that end-users have made in their transition to HD, as well as the upgrade plans for more than a dozen product categories including cameras, switchers, routers, servers, graphics, encoders, communication links, and encoders. We’ll also be publishing more information here about project-based spending and the HD transition in future articles.

At the same time, the relative importance of the transition to file-based workflows has been increasing in the market, and in 2013 is ranked #2 in the Index of Global Trends.

The “transition to file-based operations” is significant for many reasons. Over the past several years, we’ve observed a pattern whereby broadcasters, who have invested considerable time, effort, and money into transitioning their operations to HD, begin to shift their focus towards increasing the efficiency of their operations.

Over time, efficiency has become a key driver of broadcast technology purchasing.  In fact, our research shows that in many cases, increased operational efficiency and saving cost is more important than cutting-edge technology.

This is because the economics of the entire industry have changed – because of MPCD and other factors – and as a result, end-users must change their cost structure (radically in some cases) in order to generate sustained profitability into the future.

This has implications for the broadcast industry in terms of both workflows and product procurement, and as a result, the importance of both file-based workflows and “IP networking & content delivery” has increased as broadcast technology buyers continue to look for efficiencies as they transition to new technical platforms and business models.  The desire for broadcast technology buyers to gain operational efficiencies will likely continue to be a strong macro driver in 2013, as broadcasters continue to deploy new workflows.

Another key driver of broadcast technology spend is new channel launches, which have the potential to increase revenue.  New channels, and the desire for simultaneous bandwidth saving and increased image quality for MPCD services have driven an increasing interest in “improvements in compression efficiency,” which is ranked #5 in the 2013 Index.

New channel launches are being enabled by integrated playout systems (aka “channel-in-a-box”), which bring highly automated operations to channel playout and master control environments. Thus we expect to continue to see a strong interest in the “move to automated workflows” over the next several years.  Automated workflows are also seen as drivers of efficiency.

“Cloud computing / cloud based services,” which was added to the Index last year is the #6 ranked trend (up one spot from last year).  It seems that you can’t read anything about technology these days (broadcast or otherwise) without coming across some mention of “the cloud.”  So why is something so important to so many people ranked in the middle of the pack?  Our research shows that it’s still early days for cloud technology in the broadcast industry. Not only is there still a lack of widespread understanding about exactly how the cloud will impact the business models of broadcast technology buyers, there is also an inherent distrust of cloud technology by many broadcasters.  We posted some preliminary information about the planned uses of cloud technology in the broadcast industry in an earlier article called With All the Hype About Cloud, What Are Media Organizations Actually Going to Deploy?

Nevertheless, cloud technology is seen as increasingly important by broadcasters, as evidenced by several recently announced end-user initiatives and many discussions about creating a “virtualized broadcast infrastructure” in order to drive greater efficiencies.

So while the “hype” surrounding cloud technology in broadcast may be real, it appears that a previously much-hyped technology, 3D, is seen as increasingly less important to end users. Research participants ranked 3D at #14 in the 2013 Index.  It was #10 in 2012, and #8 in 2011.

In addition to creating greater efficiencies, end-users are also looking for ways to increase their revenue in an environment where the economic model of the industry is changing dramatically.  Thus “video-on-demand” (#7), and “targeted advertising” (#9) make strong showings in the 2013 Index.

Although it’s towards the bottom of the rankings, “analog switch-off” is very important for those regions where it’s happening today – primarily as mandated by local governments.

As with previous years, the following trends were ranked towards the low-end of the Index: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations” and “green initiatives”.

We’ll take a more in-depth look at the year-over-year changes in a subsequent post.

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The information in this article is based on select findings from the 2013 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands. Nearly 10,000 broadcast professionals in 100+ countries took part in the 2013 BBS, making it the largest and most comprehensive market study ever conducted in the broadcast industry. The BBS is published annually by Devoncroft Partners.

Granular analysis of these results is available as part of various paid-for reports based on the 2013 BBS data set. For more information about this report, please contact Devoncroft Partners

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Related Content:

The 2013 Big Broadcast Survey (BBS) – overview of available reports, including covered brands and product categories

The 2012 BBS Broadcast Industry Global Trend Index

The 2011 BBS Broadcast Industry Global Trend Index

The 2010 BBS Broadcast Industry Global Trend Index

The 2009 BBS Broadcast Industry Global Trend Index

 

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© Devoncroft Partners 2009 – 2013. All Rights Reserved.

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Brightcove Revenue Increases 32 Percent in Q3 2012

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Nov 01 2012

Online video publishing provider Brightcove announced that its revenue for the third quarter of 2012 was $22.1m, up 32% versus the same period a year ago.

Subscription revenue for the quarter was $21.5m (97% of total revenue), up 35% versus the same period a year ago. Professional services and other revenue was $600,000, down 25% from last year.

The GAAP net loss for the quarter was $600,000, or $0.02 per share, compared to a GAAP net loss of $5.4m, or $1.09 per share last year.  The non-GAAP net loss for the third quarter was $1.5m, or $0.05 per share, compared to a non-GAAP net loss of $2.9m, or $0.59 per share last year.

The GAAP operating loss for the third quarter was $3.7m, compared to an operating loss of $3.3m last year. The non-GAAP operating loss for the third quarter was $1.3m, compared to a non-GAAP operating loss of $2.2m last year.

GAAP gross margins were 68% for the third quarter, flat with last year. Non GAAP gross margins were 69%, up from 52% last year.

The company ended the quarter with cash, cash equivalents and investments of $30.8m, down from $58.6m at the end of the previous quarter. The decrease in cash was driven primarily by the $27.2m acquisition of Zencoder.  Free cash flow for the third quarter was $1.4m compared to negative $5.5m last year.

 

Brightcove chairman & CEO said he was pleased with the Q3 results and issued a bullish statement on the company’s future potential, saying “We believe that we are in the very early stages of a fundamental shift in how digital content is being delivered and consumed. We view this as a significant market opportunity, and Brightcove is focused on leveraging our first mover advantage into continued, long-term market leadership.”

 

Guidance:

Brightcove said it expects to post a Q4 2012 non-GAAP operating loss of $1.9m to $2.2m on revenue of $22.8m to $23.3m. The non-GAAP loss per share for Q4 2012 is expected to be $0.07 to $0.08.

For the full year 2012, the company expects to post a non-GAAP operating loss of $7.5m to $7.8m on revenue of $86.5m to $87m.  The full year non-GAAP  loss per share is expected to be $0.35 to $0.36.

The company cautioned that the finalization of the Zencoder acquisition could impact its non-GAAP results for the fourth quarter and full year 2012.

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Related Content:

Press Release: Brightcove Announces Financial Results for Third Quarter 2012 | Business Wire

Brightcove SEC Filing Details Zencoder Financials

Brightcove SEC 8K Filing: Zencoder Financials

Brightcove 8K Filing with SEC: Zencoder Inc Financial Statements Year Ended December 31, 2011 and the Period From January 8, 2010 (Inception) through December 31, 2010

Brightcove 8K Filing with SEC: Zencoder Inc. Unaudited Condensed Financial Statements For the Six Month Periods Ended June 30, 2012 and 2011

More Broadcast Vendor M&A: Brightcove Buys Zencoder for $30 Million in Latest Video Transcoding Deal

Press Release: Brightcove Announces New Services to Transform the Video Encoding Workflow | Brightcove

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© Devoncroft Partners. All Rights Reserved.

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