Technological advancements in the broadcast industry are applying upward pressure to the global production switcher market, on track to exceed $250 million in 2019, according to a new report from Futuresource Consulting.
“2018 was a landmark year for the industry,” says Chris Evans, Market Analyst at Futuresource Consulting. “Tier one broadcasters drove an uptick in investment, stemming from the ratification of SMPTE ST 2110 unlocking budget for new deployments. We also saw a significant number of projects for new flagship OB trucks in Europe and APAC, driven by demand for more live events coverage.
“The learnings made by early adopters and a more mature offering of IP products on the market have come together to build confidence in an IP future, which has stimulated the high end of the market and is moving products with price tags in excess of $50,000.”
The broadcast industry’s transition to IP is cannibalizing the SDI switcher market. Rather than generating overall volume growth, it is resulting in an increase in the average selling price per switcher input. In 2018, this led to year-on-year value growth of 4% against a backdrop of very little volume growth.
APAC continues to present the biggest opportunity for the market, as the roll-out of pay TV to an expanding middle class creates a demand for more premium live content. The region is forecast to retain the largest share of market value throughout the forecast period, but will reach its peak in 2021, as Chinese state broadcasters conclude their investment in upgrading to 4K at the same time as post-Olympic uptake of 4K extends to smaller regional broadcasters in Japan.
“Despite the positive industry effects of the move to IP, the future is not so clear-cut,” says Evans. “Feedback from the industry suggests that the costs of installing a ST 2110 system are largely prohibitive for anyone except the high-end broadcasters. Right now, middle market and lower end customers are playing a waiting game, as the effective cost of implementing ST 2110 is still too great for them to achieve a return on their investment.”
— Nicola Finn, in London