Who Will Win The Camcorder Format War?

Who Will Win The Camcorder Format War?More than four in every five camcorders sold in Europe in 2005 recorded footage to digital tape. However, according to a new industry report from Understanding & Solutions (U&S), digital tape will only account for 14% of the European camcorder market by 2010.

“Over the course of 2006 we’ve seen a format war develop between Digital Tape, DVD and Hard Disc Drive (HDD) camcorders,” says Simon Bryant, Business Director of Consumer Electronics at U&S. “Right now, digital tape still accounts for nearly 70% of the European camcorder market, but DVD is gaining ground, and as early as Christmas 2008 shipments will outstrip those of digital tape.”

With most of the leading brands producing DVD camcorders in 2006, the format has proved itself popular across the globe. Prices are now beginning to fall and by 2008 the price will be close to that of digital tape.

Who Will Win The Camcorder Format War?“By 2010, DVD will have clearly established itself as the format of choice for mass market consumers, and will account for nearly half of all camcorders shipped,” says Bryant. “This format’s appeal is its ease of use. You can record direct to a DVD and then drop the disc straight into your home player: it makes for a hassle-free workflow system. Couple this with the wide availability of low cost DVD players and you can see its appeal.”

The third competing format – the HDD camcorder – is still a niche product, but has outperformed the expectations of many, performing particularly well in the Japanese market. Though it has a more complex workflow and archiving process when compared with DVD, consumers are becoming familiar with the variety of HDD-based devices within their homes. As the migration of HDD from PCs to MP3 players, set top boxes and games consoles continues, its many benefits will become more widely recognised, making it an attractive alternative to DVD. By 2009, U&S predicts HDD will have overtaken digital tape to become the second most popular choice amongst camcorder purchasers, accounting for 31% of all camcorder shipments in Europe.

In addition, the rise of High Definition Television, with more than 115 million ‘HD-Ready’ homes in Western Europe by 2010, will create further opportunities for the camcorder market. Fuelled by consumer demand for flat panel LCD and plasma TVs, most of which now come HD-Ready, the hunger for HD content won’t be far behind. High Definition DVD players are already available, in either HD-DVD or Blu-ray format, and the next 12 months will see a proliferation of High Definition consumer electronics products. As a result, the camcorder market is forecast to experience a similar revolution, with High Definition devices becoming ever more prevalent. However, initial demand will be low and will ramp up slowly, due to the large price premiums. Longer term, HDD camcorders, with far greater storage capacity than DVD camcorders, will be the preferred choice for memory-hungry High Definition image capture.

Who Will Win The Camcorder Format War?In addition to traditional motivations for video capture, there is an upsurge of consumers who capture video to inform, meet and entertain, primarily via the Internet. The growing global interest in social networking sites such as YouTube and MySpace will squeeze the camcorder market, applying pressure through hybrid ‘still-cams’, digital cameras and mobile phones. In particular, the ever-increasing capacity of flash memory will make these devices a serious future competitor to the camcorder.

Due to issues surrounding quality, features and functionality, the short-term impact of convergence on the camcorder market will be minimal; however, moving forward, high-end digital cameras, hybrid ‘still-cams’ and mobile phones will increasingly steal share of the video capture market.

1 In 3 Euro Homes To Have AV/IT Network By 2010

1 In 3 Euro Homes To Have AV/IT Network By 2010More than 1 in 3 European households will have an integrated home network by 2010, according to a new industry report from Understanding & Solutions.

Until recently, home networking – the ability to connect digital devices together around the home – has largely been confined to Broadband and PC networking. However, linking multiple computers, telephones, televisions, Personal Video Recorders (PVRs), games consoles, home security systems and other digital devices into a home network is slowly beginning to generate a groundswell of activity.

Understanding & Solutions predicts that within 2-3 years IP crossover networking (bridging the gap between PC/Broadband and AV/Broadcast) will gradually increase as a result of consumer demand, coupled with a growing online content supply from the entertainment, photo services and consumer electronics industries.

“We’re all becoming more demanding, craving access to up-to-the-minute entertainment and information – however, wherever and whenever we want it,” says John Bird, Principal Analyst at Understanding & Solutions. “Home networking is the new gateway that manages, transports and stores our information across multiple devices within the home: it’s the great content enabler and by 2010 at least 30-50% of all consumer electronics devices on sale will be network-enabled.”

There are two key factors driving the home networking revolution, each with its own respective service provider ‘push’: namely, the wide availability of Broadband and the increase of digital multi-room TV networking.

1 In 3 Euro Homes To Have AV/IT Network By 2010

Consumers want to access Web content on a range of devices, including PCs, laptops (accounting for over 50% of the consumer PC market), games consoles and handheld devices. Additionally, PCs are increasingly being used to store entertainment content, which consumers now want to access and view on other consumer electronics products around the home, including TVs, PVRs and home audio equipment.

In parallel with this Broadband-driven trend, multi-room TV networking will move from analogue to the digital domain over the next 3 years, using Wi-Fi and a variety of ‘no new wires’ technologies. For example, coax, powerline and phone line communication signals can now carry a digital network signal around the home: simply plug in and you are connected.

A significant cultural change over recent years is that many consumers are using the PC as a mainstream TV viewing platform. Indeed, a quarter of European homes now have PCs and TVs co-located in the living room.

“Another key factor,” says Bird, “is the MP3 boom. With more than 200 million player owners worldwide, consumer focus is moving towards the PC as a music access device, storage platform and media library. This is resulting in a small, but growing number of users networking PC-based content and direct Broadband connectivity across to other audio devices such as home music systems.”

Networking of AV/Broadcast-centric and PC/Broadband-centric ‘clusters’ will not happen overnight, but the ingredients for market growth are there. As Broadband architectures and mass storage evolve towards fully-networked distribution systems, a new breed of consumer is demanding its own home entertainment and communications hub in a rapidly converging marketplace.

Understanding & Solutions