World ready for video-on-demand but can server vendors meet the challenge?

20 October 2004 News

Until recently the video-on-demand (VOD) market has been almost exclusively a North American phenomenon, driven by the overwhelming dominance of cable services there. That state of affairs has existed for most of the three years since such services were launched. In the last six to nine months, however, VOD has started to gain real traction in other parts of the world.

Vamsi Sistla, ABI Research's director of broadband research, says that international adoption of VOD would have been quicker, but for the worldwide economic slowdown. However, China, Japan, Korea, Australia, Venezuela, the UK and several other EU countries have all seen VOD deployments recently, and according to the research firm's new study, the time is now ripe for those fledgling markets to spread their wings.

In the US, the three dominant vendors of VOD servers have been Concurrent Computer, nCube and SeaChange. Many of the initial overseas VOD deployments have used servers from one or the other of them, with nCube currently leading the race. However, Sistla says they have a problem: how to market their products to international buyers who may not be willing or able to pay American prices.

"If they cannot find a way to address these markets at an acceptable price point," notes Sistla, "local VOD server vendors will undoubtedly seize the opportunity. They are naturally more attractive to local operators (who are increasingly not just cable operators, but telcos): they are cheaper, they have regional support, and they have localised brand recognition."

www.abiresearch.com

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