Compression: Technology, Need Continue to Grow - Page 1 of 4

The amount of available bandwidth is the only part of the broadcasting sector not growing. How is the latest in compression technology keeping revenues flowing and what lies ahead for broadcasters?

The broadcasting industry needs more bandwidth to meet growing consumer demand for services. Until that becomes available, efficient use of existing bandwidth is becoming more and more critical. "Bandwidth is finite," says David Szelag, vice president of technical operations for Globecast America. "Content is becoming increasingly and readily available on so many different mediums: mobile, 3G, cellular, Wi-Fi, and WiMax. These are the areas that drive consumer convenience, and that’s where we’re going to see the greatest impact of compression. The better compression technologies we have, the better chance we have of succeeding. Compression also opens a lot of opportunities for new markets. The question is how far can we push that envelope and what can we get through the smallest pipe with no perceptible loss of quality?"

DVB-S2 modulation and MPEG-4 advanced video coding (AVC) (H.264) compression have become a necessity for optimizing satellite links used for video broadcasting and point-to-multipoint networks. But while the need is great, adoption of the latest compression technologies is hampered by factors such as legacy networks with plenty of life remaining and the cost of new equipment. "Today, we want to send more, do it in a different way and not pay any more," says Daniel Enns, senior vice president, strategic marketing and business development, for Comtech EF Data. "Demand for bandwidth is infinite and would grow and grow if no cost growth was involved. Bandwidth is in a perpetual spiral of needing more. In order to give you that ability to do differentiated services, we have to do things such as optimizing operational expense, extending the experience to you so you stay with me but don’t lose money."

Current Demand

"There is a significant need for compression today just as there was 10 to 15 years ago when MPEG-2 technology first came on the scene," says Lisa Hobbs, vice president, business development, satellite and broadcast for Tandberg Television. "What we are seeing is an explosion in HD (high-definition) services broadcast over satellite. Clearly that takes up a lot of bandwidth, so the more compression you can get without impacting video quality the better. So we are seeing a move toward MPEG-4. It provides better compression efficiencies than MPEG-2, anywhere from 30 percent to 50 percent bit rate gain depending on video content."

NSR projects that the market for compression equipment sales will reach more than $8.2 billion within five years. According to "MPEG-4 and DVB-S2: Assessing Implementation Schedules for Advanced Video Compression and Satellite Modulation," released in January, the market for DVB-S2 and MPEG-4 equipment will experience strong demand, driven by new system deployments and migration scenarios for five satellite applications: direct-to-home (DTH) and satellite free-to-air (FTA), satellite broadband and IP trunking, headend in the sky, video distribution and contribution, and digital media distribution. Demand for equipment such as MPEG-4 set-top boxes, DVB-S2 receivers, satellite broadband indoor units and integrated receiver-decoders will drive revenue growth.

"In terms of real need, specifically video, HD is the only driver I see," says Hobbs. "If look at SD (standard-definition) channels, there just haven’t been nearly as many new SD channels launched as a move toward HD, because everyone knows HD is the wave of the future. There are roughly the same number of SD channels as in years past, but we are getting HD versions of those channels, so more overall channels are being offered."

Motorola Inc. is active in a number of different segments, delivering services for players such as HBO and Showtime as well trying to capture business from DTH operators, says Neil Braydon, product marketing manager for Motorola’s MPEG-4 Encoding Solutions Group. "Certainly the new compression technology has been key in this delivery of HD. Without the new compression technology, the delivery of HD would have been difficult. It’s such a bandwidth hog. With MPEG-2, delivery would have been limited. We really needed AVC to come along to help enable widespread delivery, and we are seeing HD is very much mainstream now."

Compression also is in demand in the data delivery sector, and an area that is thriving is WAN (wide area network) optimization, says Enns. "WAN optimization is a very booming market today. There is not a network appliance or network product manufacturer that doesn’t have something on WAN optimization. All users want more. They seldom want to pay more but want a better experience. From the perspective of a service provider, we are trying to figure out how to do this without paying more. Any piece of equipment is valued by an offset in operating expenses. How much capital expenditure will I put in to get what kind of operating expense benefit?

"On a satellite, this is about power bandwidth or equivalent of power bandwidth. If I can use same power bandwidth and give you twice the throughput, I’d be a hero," says Enns. "Then the service provider could lower what they charge or bring in twice as many users. To that effect, we’ve been using forward error correction and higher modulation as getting more for satellite bandwidth is what a satellite modem’s entire premise of life is. We’re pushing the envelope until we have no more way to get to nirvana."

"The biggest need for compression is in applications that don’t have decent bandwidth. Prime examples are newsgathering, emergency response/assessment or special forces operations."

— Hildeman, Streambox

Compression advancements also will be key in new broadcasting areas such as IPTV. "All of them have one thing in common, they are interested in compression efficiency. We are doing our best to continue to drive efficiency to able to deliver video at the lowest bit rate. It’s amazing how quickly the bit rate has come down since using AVC technology," Braydon says. "It has become a necessity as the amount of HD delivery has increased. Operators have a lot of commercial pressure to deliver a lot of content, and AVC technology has helped quite a bit."

Gal Garniek, assistant vice president of marketing, North America for Scopus Video Networks, sees the digitalization process opening up more opportunities for technology providers. "In every location in the food chain there are so many opportunities. If some kind of opportunity is filled, then another area opens up. Take the U.S. cable industry. Around 2003-2004, the old digital transition ended and most [multiple system operators] moved all of their signals to the digital domain. That led to a lot of encoders, statistical multiplexing and so forth. "Around 2005, we see how business slowed down, and then on another front, DVB-S, EchoStar and DirecTV, H.264 HD suddenly opened. Tandberg and Harmonic started selling a lot of encoders to this area. Satellite goes in waves. The first deployment in 2005-2006 and then the second in 2006-2007 became huge competition for cable, so cable had to add more. So now operators were adding 50 to 100 channels to their facility, which again is an opportunity for encoders."