Broadcast Value Chain to Reach $8.7 billion in North America and Western Europe by 2012

Spending by broadcasters in North America and Western Europe on technology will reach an estimated $8.7 billion by 2012, according to a new report, “The Evolving Broadcast Value Chain, 2006 – 2012,” from Datamonitor, writes MarketingCharts.
The broadcast value chain is undergoing a significant transformation as digital workflows, high definition (HD) and traditional IT infrastructure revolutionize the TV industry, the firm said.

(See a graphical representation of the broadcast value chain.)

“The broadcast value chain market will see significant growth over the coming years as broadcasters look to upgrade their equipment to handle file-based workflows and HD content,” said Chris Khouri, Datamonitor’s media and broadcasting analyst and the report’s author.

(See chart of forecast for North America and Western Europe.)

By the end of 2006, broadcast value chain market revenue in Western Europe and North America totaled $6 billion, Khouri said, with North America accounting for $3.2 billion and Western Europe accounting for $2.8 billion.

Between 2007 and 2012 the market will grow at a compound annual growth rate of 6.4 percent, according to Datamonitor.

Traditional media-based workflows, involving the physical movement of video assets from one point to another are being rapidly transitioned to digital “tapeless”-based workflows. As a result, managing, tracking and handling digital assets are becoming some of the most important aspects of a modern broadcast system.

Over 65 percent of respondents to Datamonitor’s Customer Focus survey of 150 broadcasters consider standardizing infrastructure technologies and simplifying their current broadcast systems as key strategies for 2007.

One of the primary challenges associated with the looming transition to an HD-based broadcast environment is the integration with standard definition (SD) infrastructures. The use of multiple new signal formats is a major issue with the move toward a hybrid infrastructure, with broadcast facilities forced to handle a plethora of audio, video and aspect ratio formats.