Video transcoder market will continue to grow, driven by HEVC adoption

December 2, 2013 - 5:46pm
Video transcoders are essential to the delivery of HEVC compressed video to any device environment.

Video transcoders for next-generation multichannel distribution will continue to be hot-ticket items for broadcasters and network operators, according to recent research by MRG. High efficiency video coding (HEVC), the compression standard that debuted earlier in 2013, is one of the main driving factors toward increased procurement, as media companies concentrate more resources on network optimization for any device environment. 

The increased utilization of HEVC compression in 2014 will spur video transcoding market growth over the next several years, Rapid TV News reported. Transcoder revenues are forecasted to surpass $490 million by 2017, with live streaming transcoders accounting for the majority of market gains. Vendors need to invest in transcoder solutions that enable the use of HEVC codecs without sacrificing functionality in older compression formats during the transition. Distribution over the Internet is the most significant factor behind the rising demand, but other activities, such as digital archival, are also contributing to the need for greater density input/output hardware.

Video transcoders: Delivery and mezzanine
Mezzanine transcoders continue to see increased adoption as critical components of complex video production systems. As opposed to delivery transcoders, which facilitate the transport of video files to viewing devices in the correct formats, mezzanine transcoders are used as part of production workflows, according to the news source. They are part of a workflow system that is being automated in order to reduce the need for engineers to manually process and transcode video.

"Many of the customers for file transcoders buy them for mezzanine transcoding and workflow automation which can save money and time, thereby boosting profits and possibly generating revenue if it allows them to distribute their content more widely," said MRG senior analyst Michelle Abraham, according to the news source.

HEVC royalty discussion takes backseat to functionality
As it represents an opportunity for increased digital ad insertion in a radically different environment, the HEVC standard has also recently been the subject of discussion over anticipated royalties. Streaming Media contributor Jan Ozer wrote that while it seems as though HEVC will be similar to its predecessor, H.264, in royalty structure, the industry's primary focus is the successful integration of HEVC and next-gen transcoders within video broadcast systems. The seamlessness and power efficiency of mobile viewing continue to be central concerns to both network operators and content publishers as they strive toward end-to-end optimization. 

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