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Trends and Forecasts for the HEVC Video Market in M&E Applications, 2016

Trends and Forecasts for the HEVC Video Market in M&E Applications, 2016

Video is a push industry. It thrives when new algorithms to compress video more and deliver better video over available infrastructure are brought to market. HEVC is the next-generation successor to current standard AVC, but its adoption has been mired in licensing disputes and competition from open IT disciplines. There is a massive gap between devices that are capable of playing back HEVC and those that are enabled to do so. This gap is creating restraints for sale of video encoding/transcoding equipment as well. At the same time, there is slow-but-steady movement forward, particularly in the areas of 4K, next-generation broadcast, and HDR. With future roadmaps and product strategies for many classes of companies hinging heavily on video codec strategy, there is need for reliable and objective strategic direction around this new codec.

The moving pieces of HEVC span consumption devices, streaming standards, encoding/decoding and licensing. This insight provides in-depth analysis of forces shaping the market. It compiles, in a single source, forecasts for all classes of video-enabled CE devices as well as all types of professional encoders and transcoders for media and entertainment applications. Competing options for next-generation video compression technology are placed in context, for both M&E and enterprise applications. Strategic recommendations for content business are provided. Finally, select vendors that stand out in the 2016-to-2018 timeframe are highlighted, on account of strong value proposition and consequent market leadership in unit sales and/or revenue.

Key Questions This Insight Will Answer:
• Is the market growing? How long will it continue to grow and at what rate?
• What is the relationship of this technology to other competing options? Who will win?
• What technical trends are shaping the marketplace today? What disruptions are on the horizon, and what implications does this have on future product strategy?
• How should content companies plan to grow usage and profit? How should technology vendors enable content companies to do so?
• What role are licensing pools and patent holders playing in propelling or holding back the market?

This study is one in a series of full-length and topical research deliverables provided by Frost & Sullivan in the general area of video encoding and transcoding.

The most pressing challenges to online content businesses today are monetization and profitability, and churn management. The secret to global growth is cost-efficient scalability and differentiation. HD and 4K services play an important role in this transition. HEVC, a new compression technology, was intended to replace currently prevalent standard AVC and usher the media ecosystem into a new era of high video quality, breathtaking experiences, and infrastructural efficiency. However, a quagmire of licensing hurdles quickly drove a stake into the heart of that early momentum. As a result, M&E and enterprise ecosystems have bifurcated again, with the former still using HEVC but the later coalescing around Google-promoted standard VP9.  This insight provides unit and revenue forecasts for HEVC encoders as well as HEVC-enabled decoders. It also provides suggested compression strategies for various types of video-driven businesses with an eye towards agility and differentiation.


  • Executive Summary
    • Key Findings
  • Market Forces and Trends
    • Market Forces from 2017 to 2021
    • Key Developments for HEVC in 2016
    • HEVC Encoder and Transcoder Unit Sales Forecast
      • Table HEVC-Enabled Encoder & Transcoders: Unit Sales Forecast by Segment, Global, 2015-2021
    • HEVC Encoder and Transcoder Unit Sales Forecast Discussion
    • HEVC-Enabled Broadcast & DTT Encoders Sales
      • Table HVEC-enabled Broadcast & DTT Encoders: Forecast in Relation to Overall Sales, Global, 2015-2021
    • HEVC-Enabled Pay TV Encoder Sales
      • Table HVEC-enabled Pay TV Encoders: Forecast in Relation to Overall Sales, Global, 2015-2021
    • HVEC Revenue Forecast
      • Table HEVC Video in M&E Applications: Revenue Forecast, Global, 2015-2021
    • Revenue and Pricing Discussion
    • HEVC-enabled CE Device Unit Shipment Forecast
      • Table HVEC-Enabled CE Device Unit Shipment Forecast, Global, 2016-2021
    • HEVC-enabled CE Device Unit Shipment Forecast Discussion
    • Playback on Devices-HEVC Market Maturity
  • Key Vendors and Industry Influencers
    • Key Vendors
  • Growth Opportunities and Companies to Action
    • Transformation in the Video Processing Ecosystem-2016
    • 5 Major Growth Opportunities
    • Growth Opportunity 1-Compression Technologies
    • Growth Opportunity 2-Video Everywhere
    • Growth Opportunity 3-Virtualized Workflows
    • Growth Opportunity 4-Infrastructure Upgrades
    • Growth Opportunity 5-Format Fragmentation
    • Strategic Imperatives for Video Technology Providers
  • The Last Word
    • Summary and Recommendations
    • Competition to HEVC is Growing, Even in Broadcast
    • Video Compression Choices-OTT & Broadcast
    • HEVC versus AVC-Predictions

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