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The IABM DC global market valuation report

By Joe Zaller, digital media market strategist, IABM DC

Since its first edition in 2006, the Broadcast and Media Technology Global Market Valuation Report (GMVR) has been widely recognised as the most authoritative market-sizing and forecasting report in the broadcast and digital media industry. The latest edition GMVR represents an evolution from previous versions of this report. It has been produced through a unique partnership between the IABM, the trade association that represents media technology suppliers worldwide, and Devoncroft Partners, a provider of market intelligence products and services to the broadcast and digital media industries.

IABM and Devoncroft have joined forces and established a joint venture – IABM DC LLC – whose sole purpose is to provide high-quality market sizing and forecasting data, and related products and services. The combined experience, skills, and intellectual property of IABM and Devoncroft have been combined to produce the 2013 GMVR, which is the first result of the collaboration between the two organisations.

The GMVR is the only report where broadcast industry vendors come together in a collaborative partnership, under a mutually agreed framework of strict confidentiality, to share their revenue data, future forecasts, and detailed information on what drives their businesses.

Partner data is augmented by interviews with hundreds of industry insiders (including vendors, service providers, and broadcasters), publicly available information, and exhaustive research into each industry segment, sub-segment, and product category. The result is the most comprehensive model ever created of the broadcast and digital media industry. It encompasses more than 2,000 companies ranging from large service providers and technology vendors to small start-up businesses just breaking into the industry.

Broadcast industry market sizing Using 2012 as our base year, this report values the broadcast market at $39 billion. Our analysis divides the industry into nine separate segments – eight product-oriented segments, plus a single segment that aggregates services purchased by broadcasters. In 2012, the global market for broadcast products was $19.8 billion, or 51% of the total industry value. The bulk of this report is dedicated to providing detailed information on the composition of this product revenue at the segment, sub-segment, and product category levels.

The remainder of the broadcast market is comprised of service revenue, which comes from a wide variety of sources including transmission infrastructure; managed services; systems integration, consultancy; and the rental and hire of facilities, outside broadcast resources, and specialist equipment.

Taken together, the broadcast market was valued at $39 billion in 2012, flat versus the previous year, following growth of 6.8% and a growth of 4.6% in 2010 and 2011, respectively.

Although it is difficult to generalise about such a large and dynamic marketplace, broadcast industry growth in 2010 and 2011 was due to a number of factors, including an improving economic environment in North America, the transition to HDTV in China and other emerging markets, project spending in Europe in preparation for the switch-off of analogue transmission and industry seasonality that is typified by the ‘four-year cycle,’ which ended in 2012.

However, readers should note that each segment has been subject to major shifts, some of which have changed the entire structure of the market. Even in market segments where revenue appears to be flat compared to previous years, there may be significant changes to the composition of the underlying product revenue. Many of these factors are discussed in each of the segment reports that are contained within this report. The total size of the broadcast market is shown above, including details of each market segment covered in this report.

The market for broadcast technology products and services is a fragmented one. The table above, which shows market share for the five largest players in each market segment, indicates that each segment has many participants and there is no single dominant player.

This is not a surprise considering that there are about 2,000 firms chasing $39 billion of broadcast industry revenue. However, taking into account that nearly half of industry revenue measured in this report comes from the services sector, it becomes evident that there are a large number of small hardware and software vendors in the broadcast industry. We believe the GMVR is the definitive market sizing report for the broadcast industry. It provides market sizing data for the entire broadcast industry (about 150 product categories across nine segments).

In creating the report, we built a robust data model of the entire broadcast industry. The GMVR data model includes about 2,000 companies including hardware vendors, software vendors, and service providers. One of the key inputs to this data model is the comprehensive data submissions we received from leading industry vendors who have signed on to be partners in this industry-wide collaborative effort. These partner companies have agreed to share historic and future projected sales data at a granular level according to our segmentation model of the industry.

They have also provided extensive input to the report through an interview and feedback process. In addition to partner data submissions, many data submissions were received from non-partners. Data was also gathered from a wide variety of public and proprietary sources. We also did an exhaustive review of company financials, and interviews with end-users about their past and future planned purchasing strategies. In creating the report, one of our objectives was to allow clients to purchase the entire report (all product segments) or just the specific segments that are of interest to them.

Therefore the report was designed from the beginning to be modular. This structure is important because the broadcast industry has a large number of small companies who don’t want and/or can’t afford to buy a monolithic report about hundreds of product categories that may not be relevant to them. The GMVR is currently available via the IABM and/or Devoncroft Partners. Work has already begun on the next edition of the report, and we are actively looking for new partners to join this collaborative effort.