Joseph O'Halloran ©RapidTVNews | 23-08-2011

​The controversial premium VOD services in the US are among a handful of new offerings along with advanced advertising and catch-up TV services, driving 20% growth in the worldwide market for VOD equipment.

According to ABI Research’s “Video-on-Demand, Video Server, Ad Server, Content Delivery Network Hardware”, this will see VOD equipment revenues rise from $493 million in 2010 to $591 million in 2016.

The onset of premium VOD will give a kick to VOD hardware, video server hardware, ad servers, and content delivery network hardware used exclusively within service provider or video delivery networks. In addition, pay-TV providers have integrated extra security into premium VOD services and are implementing advanced advertising solutions to help justify upgrades to their VOD equipment.

“Premium VOD requires close cooperation of VOD server and content protection vendors. In the case of DirecTV’s premium VOD launch, Home Premiere, SeaChange worked to integrate watermarking technology by Civolution to help persuade Hollywood to release premium content to video on demand (VOD) platforms,” said Sam Rosen, senior analyst, digital home at ABI.

"To date, most operators have been providing their free video on demand (VOD) libraries only as a way to reduce subscriber churn, with the focus on attracting viewers,” Rosen added. “Now, VOD system manufacturers are turning their attention to advanced advertising as a way for operators to sell ads in VOD streams.”