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Video growth drives VOD, CDN equipment markets

Posted: 13 Apr 2011     Print Version  Bookmark and Share

Keywords:video-on-demand hardware  Content Delivery Networks  VOD equipment market  CDN server market 

ABI Research forecasts that the global VOD equipment market will be worth Rs.2,687.92 crore ($591 million) while the CDN server market will reach Rs.3,520.22 crore ($774 million) in 2016, driven by operators' efforts to deliver high-quality video to iPads and other streaming devices such as PCs, cell phones and connected TVs.

Some operators are now repurposing VOD hardware—formerly used solely for pay-per-view content—to serve N-Screen or TV Everywhere platforms. Meanwhile, others are aiming for high-quality video delivery and efficient network utilisation through the use of Content Delivery Networks (CDN).

The worldwide market for VOD equipment is forecast to grow at more than 3 per cent annually, from Rs.2,242.21 crore ($493 million) in 2010 to Rs.2,687.92 crore ($591 million) in 2016, while the CDN server market is expected to grow at 4.3 per cent from Rs.2,728.85 crore ($600 million) to Rs.3,520.22 crore ($774 million). Video servers and ad servers make up the remainder of the market.

"The rapidly rising amount of video content is creating challenges for service providers," says ABI Research practice director Jason Blackwell. "CDNs have historically focused on delivery between operator networks. However, to facilitate the rapid growth of video, operators are installing CDNs within the footprint of their own networks. Operators used to plan for very low concurrency rates of about 3 per cent on their VOD systems, but increased content and use of these systems on new connected devices is leading concurrency rates to more than 20 per cent."

ABI Research senior analyst Sam Rosen adds, "Operators face a challenge when introducing new services. Time Warner Cable recently saw unprecedented demand for its TWCable TV in-home streaming iPad app, and had to scale back from 30 channels to 15 due to inadequate server capacity. Some forward-looking vendors have developed time-based licensing models to prevent this type of problem and to allow for peak-demand periods, such as sporting events, that would otherwise overwhelm the servers."

ABI Research's "Video-on-Demand, Video Server, Ad Server, Content Delivery Network Hardware" study covers worldwide markets for VOD hardware, video server hardware, ad servers and CDN hardware used exclusively within service provider or video delivery networks. It discusses the merging of managed and unmanaged delivery services, and the strategic implications of this trend, including business models, network architectures, peering agreements and demand drivers for VOD.

- Julien Happich
  EE Times

For more statistics and forecasts, click here.

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