Posts Tagged ‘VOD’

Tracking Changes in Broadcast Industry Trends — 2011 Versus 2010

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research, technology trends | Posted by Joe Zaller
Mar 21 2011

This is the second in a series of articles about some of the findings from the 2011 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands.  More than 8,000 people in 100+ countries took part in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

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In a recent post I discussed the 2011 BBS Broadcast Industry Global Trend Index, which shows the most important trends in the broadcast industry for 2011.

The article referenced both the 2009 and 2010 BBS Broadcast Industry Global Trend Index from, and looked at how the rankings of trends have changed over time.  For example, in 2009 the transition to HDTV operations was, by far, the top ranked trend.  However by 2011, the transition to HDTV operations had been overtaken by multi-platform content delivery as the top trend (although the move to HD is clearly still very important).

This post generated a lot of lot of feedback from clients and readers.  Many people said they wanted to more easily see changes to the importance of trends over time, and asked for a single chart that shows year-over-year comparisons.  I’ve done this in the chart below, which shows a comparison of the BBS Broadcast Industry Global Trend Index from 2011 and 2010. 

Please note that I have not included the 2009 Index in this chart because multiple changes were made to the trends in the Index between 2009 and 2010, reducing the ability to make an “apples-to-apples” comparison.  It’s also worth noting that all 14 trends from the 2010 Index were included in the 2011 Index.  However, based industry feedback, we added a 15th trend to the 2011 list – i.e. analog switch-off, which was ranked 11th out 15 in 2011.  The addition of analog switch-off likely “cannibalized” a small percentage of responses from other trends in this year’s ranking. 

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So what changed between 2010 and 2011? 

There are two ways to look at this:

  • changes in overall numerical ranking relative to the previous year
  • changes in overall commercial importance relative to the previous year

 

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Changes in Numerical Ranking of Broadcast Industry Trends

Let’s start with the overall numerical ranking of trends.  The first column in the table below shows how trends were ranked in 2011. The number in parentheses to the right of each trend shows how it ranked in the 2010 BBS Index. Although there were no changes at the top and bottom of the 2011 Index versus the 2010 Index, almost everything in between changed position relative to the previous year.

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As I wrote previously, the top four trends in the 2011 Global Broadcast Industry Trend Index are the same as last year and the year before:

  • Multi-platform content delivery
  • Transition to HDTV operations
  • File-based / tapeless workflows
  • IP networking and content delivery

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However, there has been considerable movement in the relative ranking of these four trends over the past several years.  Most significantly, “multi-platform content delivery” has become increasingly important, and is the dominant trend in 2011.   

Several trends were ranked more highly in 2011 than in 2010.  For example video-on-demand moved up from #8 in 2011 from #6 in 2011; while 3DTV moved up from #10 in 2010 to #8 in 2011.

Other trends remained relatively static in terms of their ranking in 2011.  For example: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations” and “green initiatives” remained the bottom four trends in 2011, as they were in 2010.

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Changes in Commercial Importance of Broadcast Industry Trends

As well as changes to numerical ranking, there were also year-over-year changes to the perception of commercial importance to each trend.  This is shown in the table below:

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For the most part, the trends moved up in the rankings in 2011 also were seen as more important commercially versus the previous year. 

However, it is possible for a trend to move up in the numerical ranking, while moving down in terms commercial importance to respondents, as happened this year with the transition to HDTV operations.  In this case, these changes are likely more of a function of the strong showing for multi-platform content delivery, than a poor showing for the transition to HDTV.

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Why Tracking Movement of Trends is Important

In the broadcast industry much of the spending on technology is project-based, and those projects all come from somewhere.  Our view is that industry trends drive capital projects, which in turn drive budgets, which in turn drive product purchase.  In other words, what’s commercially important to technology buyers today (i.e. trends) will likely turn into what they are budgeting for tomorrow (i.e. projects).

Looking at the trend data from the 2011 BBS, monetizing content on multiple platforms is clearly a key objective for broadcast professionals this year.  Yet, as I wrote a few months ago after returning from CES: “On the monetization point, I lost count of the number of times I heard the word “experimentation” during [conference] sessions – particularly from content owners.  In other words, although everyone agrees that multi-platform content delivery is a very important trend, many players have still not figured out the business model.”

There’s a difference between recognizing that a trend is commercially important and having a business plan in place that capitalizes on it.  So while there’s no doubt that generating incremental revenue by delivering a multi-screen experience to consumers is hot topic, business models have to move beyond the experimental in order to drive serious market growth.  Once that happens, multi-platform content delivery will likely become the most important planned project rather than just the most important trend.

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Keep in mind when reading this information that all data in this article measures the responses of all non-vendor participants in the 2011 BBS, regardless of organization type, organization size, job title or geographic location.  Responses of individual organization types or geographic locations may be very different than those shown in this high level overview.  Granular analysis of these results is available as part of the full 2011 BBS Global Market Report. For more information about this report, please contact Devoncroft Partners.

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Related Content:

You can find out about the 2011 Big Broadcast Survey here.

The 2011 BBS Broadcast Industry Global Trend Index is here.

The 2010 BBS Broadcast Industry Global Trend Index is here.

The 2009 BBS Broadcast Industry Global Trend Index is here.

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This article is based on the findings from the 2011 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 8,000 people in 100+ countries participating, the 2011 BBS is the largest and most comprehensive market study ever done in the broadcast industry.

Devoncroft Partners has published a variety of reports from 2011 BBS data.  For more information, please get in touch.

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©Devoncroft Partners 2009-2011

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SeaChange Announces Q4 and Full Year 2011 Results

Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Mar 18 2011

Video on demand solution provider SeaChange International announced that its revenue in the fourth quarter of FY 2011 was $61.4m, an increase of 16% versus the same period a year ago, and an increase of 23% versus the previous quarter.  Non-GAAP revenue in the quarter was $56.8m, an increase of 5% compared to the same period a year ago.

GAAP net income for the fourth quarter was $10.9m, a significant improvement on the break-even results for the fourth quarter of last year, and a GAAP loss of $5.2m during the previous quarter.  Non-GAAP net income for the fourth quarter was $5.8m, compared with non-GAAP net income of $2.3m in the previous year’s fourth quarter.

The company attributed the changes in GAAP results to two deals that fourth quarter that “materially impacted its reported GAAP financial results but were excluded from its non-GAAP financial results.”

  • In December of 2010 SeaChange realized a $1.9m pre-tax gain when a company in which it held an equity stake was sold to Dell 

 

  • During the fourth quarter a SeaChange customer switched to another VOD equipment supplier, enabling SeaChange to recognize $4.6m in pre-paid maintenance revenue as a result of the deactivation notice

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Segment Performance:

  • Software revenue was $46.1m, an increase of 32% versus both the same period last year and the previous quarter.  The strong software results were helped by the accelerated recognition of $3.4m in maintenance revenue mentioned above.

 

  • Sales from the servers & storage segment were $8.8m, down 28% compared to the same period a year ago, and up 42% versus the previous quarter.  The company attributed the decrease in servers and storage revenue to lower VOD server shipments to North American customers partially offset by VOD server shipments to a customer in Latin America and a customer in Europe.

 

  •  Media services revenue was $6.4m, up 9% versus the same period last year, and down 21% versus the previous quarter.

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Full Year 2011 Results:

For the fiscal year ended January 31, 2011 GAAP revenue was of $216.7m, an increase of 7% versus fiscal 2010.  Non-GAAP revenue for the fiscal year was $216m, an increase of 6% versus fiscal 2010.

GAAP net income for fiscal 2011 was $29.5m, up from $1.3m in fiscal 2010.  Non-GAAP net income for the year was $13.7m, up from $8m last year.

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Related Content:

You can read the full SeaChange Q4 and FY 2011 earnings press release here.

You can read about SeaChange’s Q3 results here.

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Broadcast Industry’s Most Comprehensive Market Study Reveals Top Trends of 2011

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research, technology trends | Posted by Joe Zaller
Mar 16 2011

This is the first in a series of articles about some of the findings from the 2011 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands.  More than 8,000 people in 100+ countries took part in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

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The 2011 BBS Broadcast Industry Global Trend Index

Each year, Devoncroft Partners conducts a large scale global study of the broadcast industry called the Big Broadcast Survey (BBS).  More than 8,000 broadcast professionals in 100+ countries participated in the 2011 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.

To create the 2011 BBS Broadcast Industry Global Trend Index, we presented BBS respondents with a list of 15 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 used the responses to this question to create the BBS Broadcast Industry Global Trend Index by applying a weighting based on 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, we asked this question in the context of commercial importance, rather than “industry buzz” or technology hype.

The table below shows the 2011 BBS Broadcast Industry Global Trend Index.  Please note that this chart measures the responses all non-vendors who participated in the 2011 BBS, regardless of company type, company size, geographic location, job title etc. 

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Similar to results in both the 2009 and 2010, the top four trends in the 2011 Global Broadcast Industry Trend Index are:

  • Multi-platform content delivery
  • Transition to HDTV operations
  • File-based / tapeless workflows
  • IP networking and content delivery

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However, there has been considerable movement in the relative ranking of these four trends over the past several years.  Most significantly, “multi-platform content delivery” has become increasingly important, and is the dominant trend in 2011.   For comparison:

  • In 2009, the BBS Broadcast Industry Global Trend Index was dominated by the transition to HDTV operations, while multi-platform content delivery was fourth on the list

 

  • 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 BBS Trend Index) and the transition to HDTV operations

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These results show that broadcast professionals continue to focus their efforts on taking advantage of the potential for incremental revenue streams presented by multi-platform content delivery.  Indeed, as the chart above shows multi-platform content delivery was ranked significantly higher than any other trend in our 2011 study.  As video content become ubiquitous, broadcasters and content owners are looking for ways to monetize their assets, and grow their revenue.  Technology vendors are continuing to develop solutions to convert content for optimal performance on any platform, and to run targeted ads alongside that content.

But there is more to the story than just multi-platform content delivery. For the third year in a row, the transition to HDTV operations ranks as one of the top trends in the broadcast industry.  It’s likely that HDTV upgrades will continue to be one of the major drivers of project-based spending as broadcasters around the world continue with plans to transition their operations to HDTV.  We provide significant coverage of the global move to HDTV in the 2011 BBS Global Market Report.  This includes a breakdown of where broadcasters are in their transition to HD, and a look at the upgrade plans for more than a dozen product categories. We’ll also be publishing more information here about project-based spending and the HD transition in future articles.

Operational efficiencies (through file-based / tapeless workflows) remain a significant macro driver in 2011, as broadcasters continue to deploy new workflows.  The increasing importance of file-based technologies has implications for the broadcast industry in terms of both workflows and product procurement.  Our previous research shows that broadcasters are moving to file-based workflows not only to achieve greater speed and efficiencies, but also to reduce cost.  During the recession, technology budgets were typically prioritized towards solutions that add revenue and/or reduce cost.  Now that the industry is recovering from the downturn, it’s likely that the way technology is purchased will remain focused on these commercial priorities.

Several trends were ranked more highly in 2011 than in 2010.  For example video-on-demand moved up from #8 in 2011 to#6 in 2011; while 3DTV moved up from #10 in 2010 to #8 in 2011.

Other trends remained relatively static in terms of their ranking in 2011.  For example: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations” and “green initiatives” remained the bottom four trends in 2011, as they were in 2010.

It’s worth mentioning that in order to show year-over-year movement, all trends from the 2010 BBS were included in the 2011 BBS.  However, based on industry feedback, we added a 15th trend to the 2011 list – i.e. analog switch-off, which was ranked 11th out of 15 in 2011.  The addition of analog switch-off likely “cannibalized” a small percentage of responses from other trends in this year’s ranking. 

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Keep in mind when reading this information that all data in this article measures the responses of all non-vendor participants in the 2011 BBS, regardless of organization type, organization size, job title or geographic location.  Responses of individual organization types or geographic locations may be very different.  Granular analysis of these results is available as part of the full 2011 BBS Global Market Report. For more information about this report, please contact Devoncroft Partners.

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Related Content:

You can find information about the 2011 Big Broadcast Survey here.

The 2010 BBS Broadcast Industry Global Trend Index is here.

The 2009 BBS Broadcast Industry Global Trend Index is here.

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This article is based on the findings from the 2011 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 8,000 people in 100+ countries participating, the 2011 BBS is the largest and most comprehensive market study ever done in the broadcast industry.

Devoncroft Partners has published a variety of reports from 2011 BBS data.  For more information, please get in touch.

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SeaChange Q3 Revenue Drops 8%, Says Q4 Will be Better

broadcast industry trends, broadcast technology market research, Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Dec 09 2010

Video-on-demand specialist SeaChange announced that revenue for the third quarter of 2010 was $49.9m, down 8% versus the same period a year ago, and down 3% versus the previous quarter.  The results were disappointing to equity analysts whose consensus target was $51.3m for the quarter.  

Non-GAAP net income in the quarter was $1.5m, 56% lower than the same period last year.  ON a GAAP basis, the company lost $5.2m versus a gain of $700K in last year’s third quarter.

On a segment basis:

  • Software revenue was $34.8 million, a decline of 3% versus the same period last year.  SeaChange said the drop in software sales in the quarter to lower VOD software licensing revenue from North American customers, but the decrease was  partially offset by higher sales of ad software and the recently acquired VividLogic and eventIS.

 

  • Sales from the servers & storage segment were $6.2m, down 50% compared to than during the same period a year ago.  The company attributed this decline to lower VOD server shipments to customers in North America and Latin America combined with the impact of an isolated warranty-related return of product from a customer resulting in the reduction of previously recorded revenue.

 

  •  Media services revenue was $8.1m, up 56% versus last year, thanks to new customer contracts in France and Dubai, as well as increased content processing fees from a customer in Greece.

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For the year-to-date, the company’s non-GAAP revenues were $159.2m, an increase of 7% versus the first nine months of fiscal 2010. On a GAAP basis the company’s revenues for the first nine months of the year were $155.4m, up 5% versus last year.

Year to date net income was $7.4m on a non-GAAP basis and $18.6m on a GAAP basis, versus $6.7m and 1.3m respectively.

In a statement, company chairman & CEO Bill Styslinger provided strong guidance, saying that the company’s non-GAAP revenue in Q4 would be in the $55m to $59m range.  “The strong guidance is primarily due to expectations for higher software license revenue in North America,” said Styslinger.

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You can read the full SeaChange Q3 earnings press release here.

Information about the company’s Q2 results are here.

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SeaChange Q2: Top Line Up 11%, But VOD Sales and Outlook Slump. Server + Storage BU to the Restructured

broadcast technology market research, Broadcast technology vendor financials | Posted by Joe Zaller
Sep 03 2010

Video-on-demand specialist SeaChange released their Q2 results on Thursday. Revenues for the quarter increased 11% to 51.6m, but were below the expectation of analysts who expected revenues to come in at around $54m. The company earned $3.5m, an improvement on the $376K loss it posted a year ago.

The higher top-line was driven by an increase in software revenue, thanks to the recent acquisitions of eventIS and VividLogic.  The company also said that higher VOD software maintenance revenue contributed to the increase in Software segment revenue.

However hardware sales declined 13% during the quarter, due to  lower VOD server shipments to North American and Latin American service providers offset partially by a large Broadcast server order shipped in a previous quarter and accepted by the customer in the 2011 fiscal second quarter. 

The company said that it expects lower VOD hardware demand to continue through the end of the fiscal year.

Company Chairman & CEO Bill Styslinger said that the company plans to restructure the server and storage business, and issued lower guidance for the company due to lower revenue in the server and storage revenue, combined with “software revenue challenges related to product commercialization and customer launch delays.”

Investors did not like this outlook, sending shares down sharply.

You can read the full SeaChange earnings press release here.

The broadcaster’s view of technology trends

market research | Posted by Joe Zaller
Jun 23 2009

I’ve recently been looking at how broadcast technology trends vary by geographic region, based on the research data from the 2009 Big Broadcast Survey. The examples I have shown previously look at the differences in technology trends based solely on geography. 

Now it’s time to get a bit more granular and look at how just broadcasters view these technology trends, and whether there are regional variations in their opinions.   Approximately 1,400 broadcasters participated in the study.  Each was presented with a list of 15 industry trends and asked to choose the three trends from the list (ranking them 1-3) that they feel will have the most significant impact on the way they do business over the next 2-3 years.  The chart below shows their responses, which are weighted based on how they were ranked by the respondents.  If a trend was ranked most important, its weight=3; if a trend was ranked #2, its weight=2; and if a trend was ranked #3, it is weight=1.  

 

The broadcaster's view of industry trends by region

The broadcaster's view of industry trends by region

 

In general it appears that broadcasters around the world are roughly aligned in terms of overall opinion of technology trends, but there are a few regional variations. 

Just as with the overall market, the transition to HDTV and tapeless workflows are the top trends for broadcasters, followed by multiplatform delivery and file-based workflows.  Interestingly, broadcasters in EMEA rank the move to file-based workflows higher than their counterparts in the Americas and Asia, while ranking multi-platform content delivery lower.

Otherwise, it is broadcasters in Asia  who vary from their counterparts in the Americas and EMEA. 

For example, broadcasters in Asia rank the following trends differently than their counterparts in the Americas and EMEA (although some of these are still at the low end of the range):

* IP content delivery (lower)

* automated worflows higher (higher)

* 3DTV (higher)

* Set-top box PVR (higher)

* Network PVR (higher)

 

Once again, some of the trends that we often read about in the trade press — e.g. the transition to 3Gbps and 3DTV — are relatively far down the list of business priorities for broadcasters (#9 and #11 respectively), which implies that broadcasters are continuing to move to HDTV operations while striving for efficiency in their operations rather than pursuing new technology. 

 

Here’s the full list of technology trends from the study, in the order that they were ranked by the broadcasters:

  Broadcasters — Asia Broadcasters — Americas Broadcasters — EMEA
1 Transition to HDTV Transition to HDTV Transition to HDTV
2 Tapeless workflows Tapeless workflows Tapeless workflows
3 Automated workflows Multi-platform delivery File-based workflows
4 Multi-platform delivery File-based workflows Multi-platform delivery
5 File-based workflows IP content delivery IP content delivery
6 IP content delivery Automated workflows Automated workflows
7 Advanced encoding techniques (e.g. h.264) Advanced encoding techniques (e.g. h.264) Advanced encoding techniques (e.g. h.264)
8 Video on Demand Video on Demand Video on Demand
9 Transition to 3Gbps (1080p) Transition to 3Gbps (1080p) Transition to 3Gbps (1080p)
10 3D TV On-line advertising On-line advertising
11 Set-top box PVR/DVR 3D TV 3D TV
12 On-line advertising 4K production 2K production
13 Network DVR Set-top box PVR/DVR 4K production
14 4K production 2K production Set-top box PVR/DVR
15 2K production Network DVR Network DVR

Regional Variation in Broadcast technology Trends — HDTV Still Top Trend

market research | Posted by Joe Zaller
Jun 22 2009

In a previous post about broadcast  industry trends, I looked at at a ranking of top trends in the broadcast industry and made the comment that there  is considerable variation in response when you segment data by geography and customer type.  One of the really interesting things about the data in the 2009 BBS is that is can be sliced and diced in many ways, thereby providing insight through granular analysis. 

Here’s an example of how trends can vary by geographic region:

2009 BBS trends -- regional variations

 This chart shows responses to the same question as the previous post — i.e.  “please choose from this list the top three trends that will most affect the way your company does business over the next 2-3 years” — from the point of view of people in different geographies.  Once again, a simple weighting formula was used to generate these rankings — if  a technology was ranked 1st (weight=3), 2nd (weight=2) or 3rd(weight=1).  This was done to illustrate the relative importance of  each technology trend to the respondent.  The trends in this chart are then expressed as a percentage of the total weighted votes.  As you can see, there are some interesting differences between the views of respondents in the Americas, EMEA and Asia.

While the transition to HDTV is still the top trend for all three geographies, there are differences in how important this trend is to the businesses of the respondents.  In the Americas, the transition to HDTV scores 23.79%; in EMEA is scores 21.92% and in Asia is scores 17.36%.  There are similar difference in the scores of the “file-based workflows” question.  This trend appears significantly more important to Europeans than it is to Americas and especially to respondents in Asia.

 A couple more observations:

  • Transition to HD and tapeless workflows are the top two trends in all three regions — despite the variations in importance of these trends relative to one another
  • Some of the trends that are in the news these days — e.g. transition to 3Gbps and 3DTV did not score particularly high.  Perhaps the reason we read about these trends in trade publications is that this vendors want to push the next new thing, while their customers want to complete the transition (to HD or tapeless for example) that they are in the middle of now, rather than worrying about the next new thing.
  • A few of the more “advanced” trends (multi-platform content delivery, 3D TV) scored higher in Asia than they did in the Americas or EMEA

Here’s the full list of the 15 trends from the study, ranked in order for each region.

       EMEA Americas Asia
1      Transition to HDTV Transition to HDTV Transition to HDTV
2      Tapeless Workflows Tapeless workflows Tapeless Workflows
3      File-based workflows IP content delivery Multi-platform content delivery
4      IP content delivery File-based workflows IP content delivery
5      Multi-platform content delivery Multi-platform content delivery Automated workflows
6      Automated workflows Video on Demand Advanced encoding techniques
7      Advanced encoding techniques Automated workflows Video on Demand
8      Video on Demand Advanced encoding techniques 3D TV
9      Transition to 3Gbps Transition to 3Gbps File-based workflows
10     On-line advertising On-line advertising Transition to 3Gbps
11     2K production 3D TV Set-top box PVR/DVR
12     4K production 2K production 2K production
13     Set-top box PVR/DVR 4K production On-line advertising
14     3D TV Set-top box PVR/DVR Network DVR
15     Network DVR Network DVR 4K production 
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