Vitec operates in one of the most exciting global markets; that of image capture and content creation.
This dynamic market has been transformed over the past decade and will continue to change. Driven by social media and technological innovation, image capture and content creation has grown exponentially, with millions of videos and still images taken and shared every day. This drives sustained demand for new and replacement products as customers take advantage of new technologies.
Our focus is on supplying a wide range of premium products for broadcasters, cinematographers, independent content creators, photographers and videographers to enable them to capture and share content. This content can be video footage or still images and can be produced in a studio, on location, in an enterprise or at home.
We position our brands at the premium end of the market with technically advanced products. We are focused on developing new products to enable our customers to think and work differently, to capture and create world-class content in multiple ways.
Adoption of new image capture devicesplus
The growing demand for video content, combined with the adoption of new image capturing devices, are important growth drivers for Vitec. As camera technology improves, for example, with new 4K and HDR recording capabilities, mirrorless cameras, OLED viewfinders and live streaming of content to mobile devices, this creates new opportunities for Vitec accessories (e.g. LED lights and flexible tripods) as well as for our video transmission systems as the production of live streamed content increases.
These continued technological enhancements mean that premium mirrorless cameras, drones, action cameras and smartphones are rapidly being adopted by professionals and advanced consumers as complementary equipment to traditional cameras (photo and video). This has opened up further opportunities for Vitec to develop and commercialise innovative, high end accessories that enable a competent creative public to obtain the best results from new image capturing technologies.
Furthermore, the rapid growth in smartphone adoption has resulted in a sharp increase in the volumes of general consumers shooting stills and video and uploading them to the internet with an increasing focus on quality of content requiring accessories to assist with these
Increase in video consumption and independent video creationplus
The proliferation of new media, coupled with the growth of third party streaming applications, has resulted in significantly higher content generation, engagement, reach and measurability (via likes, follows, shares and comments). Media companies today must deliver content to more platforms and devices than ever before to build brand awareness and retain their audience.
Newer online platforms such as Netflix, Amazon and Hulu have rapidly increased their commissioning of original content as opposed to re-transmitting programmes previously aired on the traditional networks. This has led to the expansion of independent or owner/operator production companies set up to produce content for those networks and those production companies purchasing or renting equipment to do so. Our products are well-suited to meeting the needs of these production companies.
These smaller production companies require more affordable, portable products. Free streaming platforms such as Facebook Live and YouTube Live allow content creators in the field (independent and traditional broadcasters) to stream live and publish content on mobile devices. Vitec provides a wide range of mobile equipment (e.g. Manfrotto and JOBY compact tripods and monopods, Sachtler Flowtech tripod, Litepanels portable lights and Manfrotto and Lowepro carrying solutions) while Teradek's Live:Air production suite offers a comprehensive video mixer for mobile devices.
Wireless and cellular data transmission, and next generation compressionplus
We see accelerating growth in the use of wireless devices to transmit data and images on "connected devices", especially through WiFi. The cost-effectiveness, range and quality of video data encoders, decoders and related components allows users to monitor and transmit at increasingly lower costs. Vitec products, including Litepanels' use of Bluetooth for remote lighting management and Teradek's wireless decoders are evidence of our innovation in new markets and technologies.
With the advent of Ultra High Definition the amount of data contained in one hour of video has dramatically increased. This, combined with the growing demand to consume video on mobile devices, necessitated a new video compression paradigm, called HEVC, or H.265. Vitec is a leading manufacturer of HEVC solutions for broadcasters and webcasters.
4K resolution adoption has increased rapidly and is becoming more mainstream in the US, with Netflix, Amazon, Sky and Apple all offering 4K Ultra HD streaming services. As adoption grows around the globe, studios and video cameras will need to be upgraded with new technology, resulting in increased demand for our products and software to accommodate the new formats. Worldwide, even higher resolutions have been launched, for example, Japan's pioneering public broadcaster NHK has already begun the world's first 8K broadcast trials.
In addition, the application of 4K video technology to both DSLR and compact system cameras is attracting a growing number of content creators who can now produce high quality visual content in either still or motion picture formats with highly dependable, portable and affordable equipment. This positive trend is expected to further consolidate with the evolution of 4K into 8K technology which will enable the extraction of high resolution still images from video assets.
Traditional broadcasters’ capital expenditureplus
Traditional broadcasters' ability and willingness to incur capital expenditure on the construction or refurbishment of studios depends partly on their financial performance. Those broadcasters reliant on advertising expenditure continue to invest in their capabilities but tend to be more susceptible to macroeconomic conditions.
Vitec's ability to offer products that reduce the capital expenditure requirements of broadcasters and in turn reduce their investment risk, is increasingly attractive, notably through savings offered by our lower cost Vinten robotic heads and Litepanels LED lighting solutions. The savings and efficiencies offered by LED lighting compared with traditional lighting are significant. There is also a focus on mobile journalism and portable solutions, for example, Vitec's carbon-fibre Flowtech tripod is popular for electronic news gathering and with independent content creators. It is not enough to simply create content for broadcast; content must also be made for online audiences, whether that is live streamed or uploaded as "second screen" content, and more bonded cellular broadcasts are using products such as Teradek's Bond.
As part of the US broadcast spectrum incentive auction, the Federal Communications Commission was authorised to "repack" the television bandwidth by assigning television stations to new channels. This process has posed significant challenges and delays for the broadcast industry as television stations will need to complete channel moves. This project has led to unexpected additional capital investments in core transmission technologies and has led to some uncertainty by US broadcasters and impacted investment in other broadcast technology, including Vitec's US studio products from our Production Solutions Division.
Sales of photographic cameras with interchangeable lensesplus
We are seeing more stability in the interchangeable lens cameras market, driven by the popularity of mirrorless cameras and their combined photo/video high resolution recording capabilities. The continued upgrade in sensors and overall specifications of latest generation compact system cameras is also driving a growing adoption of this format by advanced consumers and professionals alike. In addition, the average price of a photographic camera is increasing as consumers demand premium camera models to differentiate from images captured on their smartphones. The camera accessories market reflects this trend with increased demand for SmallHD monitors, Manfrotto high performance compact tripods, and Manfrotto and Lowepro multi-media bags.
Online distribution channelsplus
The continued growth in online distribution channels for products for photographers, videographers and independent content creators has stimulated increased demand from new customers, particularly in emerging economies where e-commerce provides easier and faster access to a wider range of products and tutorial information.
Video for enterprisesplus
There is a growing demand for high quality video being produced by a variety of non-broadcast enterprises.
- Fortune 1000 businesses wanting to capture and disseminate corporate messages internally, as well as training videos and new product introductions;
- Large religious institutions increasingly using video to connect with congregations;
- Public addresses and streaming of official meetings, court proceedings and government sessions;
- Medical institutions wanting to record healthcare procedures with high quality video; and
- Sports teams and franchises looking to capture and further enhance their fans' experience and the team's brand awareness.
These customers need to light their content, use teleprompters to better tell their story, deploy stable supports to hold and use their cameras, equipment to hold their lights and even backgrounds for their videos.