The shift to multiscreen services has driven a rapid change in demand for video hardware and video services from a licensing and product model to a services model. The rapid shift in value chain has lead to a stagnation of revenues in hardware categories, including broadcast services and network-related video hardware, while services business, notably CDN, has continued to grow. The encoding and transcoding market, also shifting from a product to service orientation, has been one bright spot in the market from equipment providers.
While CDNs continue to grow based on their wide appeal among video publishers, online video platforms (OVPs) have generally lost out in the media and entertainment (M&E) sector, providing the most meaningful services to enterprise customers around both internal and marketing / branding video use cases. Managed Video Platforms, which take more operational responsibility and may have a profit stake in video services, are increasingly becoming part of larger cloud or operator networks.
Akamai remains a strong leader in the video services market, competing largely against organizations within carriers such as Telstra’s Ooyala and Verizon’s VDMS, as well as those within media companies such as Major League Baseball’s MLBam. In the overall hardware market, revenues are dominated by broadband deployments led by Huawei, Nokia, and Arris. Within the encoding market, Harmonic, Ericsson, and Arris are strong –with Harmonic’s acquisition of Thomson and Ericsson’s acquisition of Envivio integrating the market.