(22 November 2007 3:00 pm)

MUMBAI: The broadcast value chain is undergoing a transformation as digital workflows, high definition (HD) and traditional IT infrastructure revolutionize the TV industry.

The movement is creating immense challenges and opportunities for broadcasters as they fight to adapt to multi- channel and multi-platform distribution.

In a new report, The Evolving Broadcast Value Chain, 2006 – 2012, market analyst Datamonitor says that this transition will present a clear market opportunity for technology vendors and systems integrators in the near term. It predicts that spend by broadcasters in North America and western Europe on technology will reach an estimated $8.7 billion by 2012.

Datamonitor’s media and broadcasting analyst Chris Khouri says, "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. By the end of 2006, broadcast value chain market revenue in western Europe and North America totaled $6 billion. Western Europe accounted for $2.8 billion and North America for $3.2 billion. Between now and 2012, the market will grow at a compound annual growth rate of 6.4 per cent."

The production and broadcast distribution environment is evolving: Traditional media-based workflows, involving the physical movement of video assets from one point to another and affectionately known as 'sneakernet' by some in the industry, are being rapidly transitioned to digital 'tapeless'-based workflows. This transition creates a variety of enterprise-wide benefits for broadcasters, including a reduction in operational expense, a reduction in production times and enhanced repurposing opportunities.

The broadcast space is particularly complex and is becoming ever more challenging as workflows and processes evolve. Managing, tracking and handling digital assets are becoming some of the most important aspects of a modern broadcast system. Implementing transparent asset management systems reduces operating margins, eliminates redundancies and ultimately boosts competitive position. Furthermore, aligning broadcast engineering with commercial operations through enterprise wide management solutions will be a key source of competitive advantage in the near term.

Over 65 per cent of respondents to Datamonitor’s Customer Focus survey of 150 broadcasters consider standardising infrastructure technologies and simplifying their current broadcast systems as key strategies for 2007. Transparency is crucial for broadcasters as the depth and breadth of file-based workflows develop. Moving towards central archives and architecture is expected to provide a significant opportunity to combat systems silos and eliminate redundant functions.

There is still a considerable addressable market for moving towards a fully tapeless environment. In most cases, assistance is required to help broadcasters simplify and standardize their current systems to boost efficiencies in their IP-based workflows. This will prove a lucrative opportunity particularly for professional services and systems integrators (SIs).

Challenges remain for the transition to high definition (HD) and digital archives: 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 towards a hybrid infrastructure, with broadcast facilities forced to handle a plethora of audio, video and aspect ratio formats.

Moving towards a hybrid infrastructure will require the careful re-evaluation of current workflows, particularly with the necessity of up-converts and down-converts from SD to HD, and vice versa. As broadcasters look to transition towards SD/HD infrastructures, there will be strong opportunities for those technology providers and integrators that can address the challenges presented with multiple formats.

Furthermore, as broadcasters grow their content portfolios the physical constraints and costs of storing this content increases by several orders of magnitude. Digitally storing content allows broadcasters to alleviate these costs, and benefit from an increase in usage and a reduction in time-to-air.

Back catalogue digitisation will create increased need for both storage solutions and video servers (particularly with the looming transition towards HD and MPEG-4/H.264), as well as for strong asset management systems. Enhanced asset management systems, coupled with increased transparencies within the archive management function, will prove important as back catalogue digitization intensifies.

Change creates risk, but it also generates opportunity. This is particularly true with regards to the broadcasting sector. Khouri adds, “Broadcasters are at a critical position where adapting to a fragmented media landscape is crucial for survival. As they move towards file-based workflows and HD, there is considerable risk in implementing an architecture in-house that is difficult to adapt to new standards, technologies and systems upgrades. Furthermore, broadcasters are looking for the 'whole package' rather than just a single hardware or software solution. This means that professional service providers, most notably SIs, are in an advantageous position by being able to provide holistic and managed packages from a variety of technology vendors.”