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The overall infrastructure video equipment market will grow to reach $3.8 billion dollars in 2017, up from $2.8 billion in 2012. Video encoders represent the fasted growing sub segment of the market, growing over 10 per cent annually, compared to the market as a whole which grows at a 6 per cent pace. Classic video servers, which are experiencing a high rate of integration as well as replacement with more modern IP-based architectures, increase at about 3 per cent annually.
“Significant consolidation is taking place within the video infrastructure hardware space,” according to Adarsh Krishnan, senior analyst at ABI Research. “In addition to the well-publicized acquisition by smaller Arris of larger Motorola – creating a more healthy and diverse company – Harmonic recently spun off a small and low-margin business to Aurora Networks. Mature hardware companies, including Cisco, Ericsson, and even Huawei are all turning their focus to higher margin services business as new entrants compete in well understood sections of the equipment space.”