CES Video Trends: Wheat vs. Chaff

Jan. 6, 2017
As the 2017 International CES wraps up in Las Vegas, it's time to sort the wheat from the chaff. Amongst the Internet-connected scarves and WiFi hair brushes (I am not making this up), a number of interesting ...

As the 2017 International CES wraps up in Las Vegas, it's time to sort the wheat from the chaff. Amongst the Internet-connected scarves and WiFi hair brushes (I am not making this up), a number of interesting video trends came out of the show around OTT, UltraHD and HDR, voice control, and virtual reality.

OTT

Over-the-top (OTT) video remains as strong as ever. Comcast (NASDAQ:CMCSA), apparently taking an "If you can't beat 'em, join 'em" approach, is courting OTT providers with an end-to-end solution to help content creators publish, distribute and monetize content directly to consumers. Brightcove (NASDAQ:BCOV) and Evergent announced a similar venture at the show. Vendors such as ThinkAnalytics and You.I TV are also targeting products toward OTT providers, including content discovery-based marketing and video app development, respectively.

4K/UltraHD and HDR

UltraHD/4K TV sets have been around for a while now, but new this year are 4K sets that support high dynamic range (HDR) video, which can be expected to drive increased demand for content using the higher resolutions. The Consumer Technology Association projects shipments of 4K UltraHD displays to reach 15.6 million units in 2017 (a 51% increase over last year) and earn $14.6 billion in revenue (38% increase).

Voice control

While voice control is increasingly the province of smart home technologies (more on that in tomorrow's e-letter), a number of announcements around video-related voice control came out of the show, including a couple from DISH (NASDAQ:DISH) and Universal Electronics (NASDAQ:UEIC). DISH's Hopper DVR can now be voice controlled via Amazon (NASDAQ:AMZN) Alexa, and UEI is providing the voice remotes for DISH's AirTV OTT video service. Comcast has been using UEI voice remotes with its cloud-based X1 video platform and other Xfinity products since last January. The CTA expects sales of voice-controlled digital assistant devices to reach 4.5 million units this year.

Virtual reality

Though the CTA is projecting virtual reality (VR) headset unit sales to grow 79% year-over-year in 2017, VR is still looking more like a niche technology than the next big thing. Throughput requirements for streaming decent video quality are stiff, on the order of 50 Mbps or better, and available content remains somewhat thin on the ground. Anecdotally, users of smartphone-based systems say VR is an energy hog, sometimes running down a day's worth of battery power in less than an hour. Companies such as Harmonic (NASDAQ:HLIT) and Viaccess-Orca are working to reduce the bandwidth hit, but there's been relatively little movement in display technology and products. While VR probably won't flop the way 3D did - gamers and the porn industry will keep it alive - it's not the wave of the future, either. No one is going to want to strap on expensive goggles just to watch the evening news.