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DTV Driving Market for New Video Productions Tools

The market for advanced television equipment is growing, thanks to the Federal Communications Commission's digital TV mandate. But the changeover will be slow. According to a study conducted by research and consulting firm Frost & Sullivan, industrial users of television equipment are likely to opt for converting their existing gear rather than replacing it during the transition, and they will move to software solutions for their production and editing needs.

The firm's predictions for the professional market parallel those made for the consumer market, particularly the widely held belief that most television viewers will choose to ease into DTV through set-top converter boxes attached to their analog displays. The F&S study predicts that the market for advanced video products will grow at an annual rate of 5.7% from 1999 through 2004---a figure that includes a growing demand for all types of equipment, especially computer-based gear.

Many video-production and post-production houses are turning to computers as a low-cost alternative to exotic professional hardware. The great advantage for users of PC-based video processing and editing equipment is that upgrades are typically available as software. "Increased sophistication of PC-based video equipment is bringing higher functionality to the low-end and midrange markets," says Frost & Sullivan Multimedia Communications Industry Analyst Alena Carroll. "As these products continue to improve, more post-production studios and broadcasters will consider turning toward PC-based equipment and away from high-end alternatives."

According to Carroll, heavyweight hardware makers might feel the heat from the software industry. "Manufacturers of high-end systems will have to continuously enhance their products to demonstrate their advantages over lower-priced solutions."

In reaching its conclusions, Frost & Sullivan studied 93 companies in the diversified video-production and post-production equipment market. Included were giants from the consumer-electronics industry, such as Hitachi, JVC, Panasonic, Philips, Sony Electronics, and Thomson. Multibillion-dollar companies from the computer industry were also examined, including IBM, Hewlett-Packard, Silicon Graphics, and Sun Microsystems. Among the companies with video production and/or video post-production businesses were Avid Technology, Chyron, Pinnacle Systems, Scitex, and Tektronix . Many smaller niche-market companies were surveyed as well, such as high-end video-display specialists Faroudja and Snell & Wilcox.

F&S researchers covered a wide range of related technologies, including HDTV, digital and analog broadcasting, MPEG data compression, video servers, video on demand, real-time editing, and digital signal processing as well as PAL, SECAM, NTSC, and broadband video.

Frost & Sullivan presents Market Engineering Awards to companies that have worked hard to make a positive contribution to the video-production/post-production equipment market. According to an F&S press release, this year's winner was Quantel, for "the cutting-edge technology they have been introducing into the market for a number of years. Quantel has recognized the need to offer its customers a paced transition to HDTV, since very few broadcasters or post-production houses are planning to conduct the transition rapidly because of prohibitive costs."

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