Video Technology News. You need to provide for multible standards, or get off the bus..........................................
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Flexibility Is the Key To ATV Product Development
The professional video manufacturing community would do well to develop a "tri-level" product line in preparation for the digital broadcast future, one that provides enough flexibility to meet the wide range of applications and broadcast formats that are likely to arise.
By having a diverse product line consisting of standard-definition, widescreen and high-definition gear, manufacturers will be able to tap into the coming boom in video production and transmission equipment sales prompted by broadcasters, cable companies and others looking to provide more channels or enhanced programming.
According to a new report from Multimedia Research Group (MRG), the U.S. market for professional video gear will easily top $600 million in revenue by 2002, and could climb as high as $1.9 billion.
Gary Schultz, principal analyst at MRG and author of "DTV Consumer & Broadcast Products: Market Overview and Forecast," said the broadcast and cable industries are not likely to adopt a "one size fits all" approach to advanced television, and that should lead manufacturers to provide as wide and varied a product line as possible.
"What works in Cincinnati will be different from what works in L.A.," he said. "There will certainly be opportunities for vendors that want to provide high-definition equipment. I think the broadcasters will start playing with it in about a year."
Managing R&D Resources
Schultz added that with a tri-level product line, manufacturers will have the resources to serve broadcasters and program providers looking to implement more than one format.
"A lot of final decisions (about formats) will be made at the upconverter," he said. "If someone shoots in 4:3 525-interlace and then 16:9 720-progressive, they can convert that to any other ATSC format just before it goes out."
One of the biggest advantages to the ATV market is the fact that it will develop in clearly defined stages. Under FCC rules, top 10 markets are under the gun to ramp up ATSC broadcasting by November 1998, while the top 30 network stations need to get on the air by the following June.
"Since you're only focusing on 30 markets, you're marketing costs are way down," Schultz said. "Unlike marketing on a global scale, you can focus your efforts."
Fast or Slow
The MRG study offers market predictions based on fast- and slow-growth scenarios. Under fast growth, sales of ATV production and transmission gear will hit $290 million in 1998, mostly from transmitter sales. By 2002, sales would approach $1.9 billion before leveling off to about $1.6 billion a year. Under slow growth, 1998 sales start at $192 million and rise to $676 million by 2002 and then averages at $350 million a year.
Schultz said a number of factors contribute to fast growth vs. slow growth. Among them:
Cable must-carry. If the FCC doesn't mandate it for ATV and cable operators back off from carriage, initial growth could be slowed significantly;Broadcast/cable common fee structure. If the two industries can reach revenue-sharing pacts, broadcast carriage is encouraged and ATV rollout quickens;The FCC buildout schedule. There still could be baclash from special interest groups and squabbles between industry players (like UHF and VHF broadcasters). In general, Schultz expects the top 30 markets to surpass the schedule;Growth of the PC-TV. If the computer industry figures out a way to accommodate the entire ATSC format in its products, the ATV pace quickens;Open standards among storage vendors. Common standards for file exchange, transport, etc. would greatly ease the introduction of new digital suites;Price reductions. Mid-level products priced roughly equivalent to today's gear, particularly among camera and server systems, would greatly speed up adoption of ATV.
No matter which way the market shakes out, Schultz cautions manufacturers away from sitting on ATV Production Equipment Revenues
Fast Growth vs. Slow Growth
(x $1 million)
Fast
Growth
Slow
Growth
1998 $290
$192
1999 $418
$239
2000 $867
$423
2001 $1,361
$587
2002 $1,854
$676
03-06 $6,453
$1,372
Total $11,243
$3,490
Source: MRG
the fence, hoping to tap into secondary markets.
"Ignore this at your own peril," he said. "You cannot ignore that digital television will be here soon and that should be reflected in your product development.
"If your company is already positioned as a _me too' provider with less than a 5 percent R&D budget, you're probably going to take a back seat," he added. "If you already have unique products, technical patents and are on the cutting edge, you had better be out there with some products soon."
The MRG study provides market trends and projections for the entire gamut of digital television equipment. Forecasts include professional cameras and recording/storage devices, switchers, signal processing gear, editing systems, playout, transmission and reception equipment. (MRG, 650/961-6209) |
