Revised 2009 IP Video Projections

Author: John Honovich, Published on Apr 11, 2009

IMS has publicly released revised market forecast for 2009: "IMS still sees growth, but the research firm's predictions are 15 percent less robust after the past three months of watching the market." IMS is still predicting 29% growth for IP video. I attended one of Simon Harris' presentations last month and one interesting element was how sharply and quickly revenue for IP video slowed over the last few months. A key question is how the global economy responds in the next few months. I believe achieving 29% growth for 2009 requires a recovery this year and project delays to start decreasing (both I am skeptical of).

In the SSN interview on the IMS report, Simon discusses what still drives analog sales: "It's surprising how big that low end of the market is . . . There's a lot of small retailers out there. It's a quite chunky part of the market, and that's really the mainstay of analog today." While I agree that small retailers are a mainstay of analog, given that 75% of purchases are still analog today, almost by definition, analog is being sold into way more than simply the low end. I personally know dozens of Fortune 500 companies, utilities, government agencies and military bases still buying analog. It is these really big organizations that make or break the growth of IP. The reason they still use analog is primarily because of their existing infrastructure. The cost of switching to IP can be high and a key factor in the analog/IP cross-over is reducing the transition costs. This is why I think the development of hybird systems by the incumbent manufacturers is key. The incumbent analog providers are in the best position to cost-effectively drive a transition if for no other reason than their compatability with the legacy equipment.

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