Custom Silicon Drives Video Innovation

The video streaming industry is experiencing a significant transformation driven by the increasing demand for video services and the integration of Artificial Intelligence (AI) processing. This trend has led operators to develop their own custom silicon solutions to meet the evolving needs of the market.

Over the past few years, there has been a shift towards developing custom chips in various sectors, including data centers. The emergence of custom video chips alongside these devices signifies a new era in video processing technology.

The global video streaming market size was valued at USD 106.83 billion in 2023 and is projected to grow at an impressive annual rate of 21.5% from 2024 to 2030. Innovations such as blockchain technology and AI are being leveraged to enhance video quality across various aspects of production, including editing, cinematography, and scriptwriting.

AI plays a crucial role in improving video content quality for streaming service providers, leading to a growing demand for customized silicon solutions. Graham Curren, founder of UK design house Sondrel, highlighted the need for ultra-complex custom chips to meet the processing requirements of the Enterprise Video Streaming market.

Sondrel recently secured a major ASIC design and supply contract for a next-generation video processing chip. This custom-designed chip is set to revolutionize high-performance, professional video streaming by delivering enhanced user experiences with minimal latency. The production of the chip is expected to commence in 2026, fully funded by the customer.

The adoption of cloud-based solutions is driving market growth, particularly in Europe and North America. According to a report by Grandview Research, the cloud segment accounted for over 59% of revenue in 2023. Asia Pacific is anticipated to experience the highest annual growth rate from 2024 to 2030, with North America holding the largest market share.

Streaming platforms are increasingly turning to cloud-based deployment to leverage its capabilities in handling large bandwidth and improving speed. The scalability of cloud-based solutions addresses issues such as buffering and latency, making it a preferred choice for streaming service providers over on-premises deployment.

In the education sector, the use of videos in webinars and courses has become a popular method to enhance teaching and learning processes. Educational institutions are creating multimedia content to deliver engaging video presentations, leveraging the accessibility of educational video content and the proliferation of mobile devices and internet connectivity.

Technological advancements such as 360-degree video streaming and virtual reality (VR) are reshaping the consumer experience with video content, offering new opportunities for education, entertainment, and virtual tourism. These innovations are expected to drive further growth and innovation in the video streaming industry.

Sources: GrandView Research Video Streaming Market Size, Share & Growth Report, 2030, Sondrel