Despite hitting a serious slump, the digital video software market is poised for a rebound, with modest growth in 2010 followed by significant gains through 2013, according to a new study from multimedia and graphics research and consulting firm Jon Peddie Research. Numbers from JPR show the market hitting the skids in 2008, when year-on-year growth stalled out as the market sat at just under $1.5 billion, and actually contracting slightly in 2009. (About 68 percent of that figure, or $1 billion, is the professional market, with the remainder representing consumer software.) Over the next four years, however, JPR projects that the market will grow by more than 50 percent, to $2.3 billion.
f it pans out, that's good news in the long run, as it would mean a compound annual growth rate of 9 percent for the years 2007 to 2013, which includes the current recession. It's especially good news for Adobe, Apple, and Avid, which JPR acknowledged “dominate” the market.
JPR VP Kathleen Maher, author of the report, said via email that she based her forecast for continued growth on a belief that stereo 3D film production would be good for business across the board, and that increased utilization of VFX in all genres of filmmaking as well as trends toward ever-higher-resolution formats in production and post would help maintain revenue on the high end of the market.
2007
2008
2009
2010
2011
2012
2013
Worldwide forecast for Digital Video software ($M US dollars) CAGR-9%, 2007-2013
1,480
1,485
1,474
1,533
1,763
2,028
2,332
Year-on-year percent growth
--
0.3
-0.7
4.0
15.0
15.0
15.0
Source: Jon Peddie Research; HD Studio
As far as specific signs of life in the industry, she pointed to growth in mid-range desktop software, especially given increasingly attractive pricing. “I believe Avid is catching on,” she told HD Studio. “Apple has just released a new Final Cut Studio with a reduced price, and I like some of the things Adobe is doing with metadata that are going to aid the advertising industry.”
As far as bellwethers of a recovering industry economy are concerned, Maher said she'd keep an eye mainly on activity in the movie industry and, to a lesser extent, on TV, while cautioning that the advertising industry may take longer to recover. “The movie industry has had a good first half of 2009,” she said. “There are a respectable number of movies in the pipeline. On the TV side, watch online distribution of TV content. Site like Hulu, NBC, etc., are actually doing pretty well in advertising. This is a model that is still evolving, and it's going to drive growth.
The Digital Video Software Market Study, part of JPR's Digital Content Creation series, is available for $3500 to single users, or $5000 for a site license.
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