Next Generation Video Codec in Spain Trends and Forecast
The future of the next generation video codec market in Spain looks promising with opportunities in the mobile phone, computer, and TV markets. The global next generation video codec market is expected to reach an estimated $7.9 billion by 2031 with a CAGR of 22.1% from 2025 to 2031. The next generation video codec market in Spain is also forecasted to witness strong growth over the forecast period. The major drivers for this market are the growing demand for better video experience, increasing mobile video consumption, and the proliferation of video content across platforms.
• Lucintel forecasts that, within the video codecs type category, the HEVC segment will remain the largest segment over the forecast period due to cutting the necessary bitrate in half while maintaining similar image quality, but at the cost of more processing complexity.
• Within the application category, mobile phone is expected to witness the highest growth.
Emerging Trends in the Next Generation Video Codec Market in Spain
Microsoft Teams has committed to researching how to improve virtual meetings through the development of metaverse applications. The industry requires innovation for improvement, and innovation derives from the emergence of technological advancements, increased demand for digital video content, and the adaptation of 5G networks. The next generation video codec market in Spain is evolving at a fast pace, leading to the evolution of the Spanish media and entertainment industry and even telecommunications. Spain is in dire need of advanced video codecs that are high in quality, yet manage to consume low data. Below are five trends that are windows into the future and set the tone for the next generation video codec market in Spain.
• Emphasis on AV1 Adoption: The new AV1 codec, which eliminates the need for licensing, is becoming popular in Spain because it permits the streaming of videos at high resolutions while simultaneously minimizing bandwidth use. It is the preferred codec for new generation video streaming platforms that offer 4K and 8K streaming due to the much higher compression rate than older formats like HEVC. AV1 will soon dominate OTT and broadcasting services, creating more opportunities in the market for content providers and telecom companies willing to enhance video delivery without sacrificing quality.
• 5G Video Streaming Adoption Increase: The continuing deployment of 5G networks in Spain creates a new opportunity for the Next Generation Video Codec industry. Thanks to 5G’s high download and upload speeds, consumers can watch HD video content without any buffering or excessive lag. This is particularly useful for live streaming, gaming, and mobile video applications. With the rise in demand for quality mobile video services, AV1, HEVC, and other low bandwidth, low latency streaming-optimized codecs will change the way consumers engage with video content.
• AI Techniques Incorporated in Video Compression: In Spain, the development of video compression technologies powered by Artificial Intelligence (AI) is receiving wider adoption. AI allows video encoding to be smarter. Compression can be optimized for efficiency by encoding the video in real time and modifying video parameters such as bitrate and resolution. This improves compression while maintaining the quality of the video. In turn, AI-powered video codecs can achieve increased use of video data while providing smoother streaming to users, which is beneficial to both consumers and service providers. Codec innovations in telecommunications and entertainment industries will continue to further develop due to this evolution.
• Improved Video Delivery for Work and Learning from a Distance: The level of remote work and online teaching in Spain increased drastically during the COVID-19 pandemic, creating a demand for effective video communication tools. With video conferencing increasingly becoming a part of daily business and education, there is a demand for codecs that can deliver quality video even with limited bandwidth. HEVC and VP9 video codecs are very important adaptive bitrate technologies that drive professional and educational platforms’ usage of video codecs to enhance user experiences. They enable seamless communication via video in low-bandwidth environments.
• Increasing Need for VR and AR Content: In Spain, VR and AR applications are widely used in gaming, entertainment, and even training. The nature of VR and AR requires high-speed video transmission at low latency. These technologies, however, require the next generations of video codecs that support the instant delivery of high-value VR and AR video products. The integration of advanced video codecs into VR and AR systems in Spain will enable greater opportunities for the creation and consumption of VR and AR immersive content.
The next generation video codec market in Spain is shifting with trends such as the adoption of AV1, 5G video streaming, the use of AI in video compression, improved video servicing for remote working and learning, and the increasing appetite for VR and AR content. These trends increase the need for efficient and high-quality video codecs that address the changing requirements of consumers and industries. With the continuous adoption of cutting-edge video technologies in Spain, the market for Next Generation Video Codecs is poised for growth and change.
Recent Developments in the Next Generation Video Codec Market in Spain
Spain is experiencing rapid growth in the next generation video codec market due to increased demand for high-quality video content from a multitude of platforms. Improvements in video codec technology, along with the market need for video streaming and communication compression, are driving growth and innovation. Below is a summary of the top five developments that are impacting the Next Generation Video Codecs market in Spain concerning video content production, distribution, and consumption.
• Adoption of HEVC and VP9 by Spanish Streaming Services: To meet the increasing demand for 4K and UHD materials, streaming services operating in Spain have recently sought the use of advanced video codecs HEVC and VP9. These codecs facilitate both better compression and efficient streaming. These codecs use less bitrate than older technologies, thus allowing better-quality videos to be streamed. These codecs are essential for painless video delivery and playback, especially in places where internet infrastructure is not robust. Because streaming companies are looking to provide impeccable quality video content, these codecs have become crucial to the services’ performance.
• Deployment of AV1 for 4K and 8K Content Delivery: With the survival of the fittest applying in business, streaming services in Spain have already started embracing the use of the AV1 codec to facilitate better 4K and 8K video delivery. AV1 not only enables greater compression than other existing codecs but also improves audiovisual quality at lower bitrates. AV1 is also expected to be adopted by Spanish telecommunications and media companies looking to gain an advantage in the ever-demanding global streaming scene. Given the fact that AV1 is royalty-free, content and service promoters will have planned an AV1-enabled system, further intensifying its adoption in Spain.
• 5G Expansion and Its Effects On Video Streaming: The launch of 5G networks in Spain has significantly increased the consumption of HD and UHD video content. The 5G network permits the seamless viewing of 4K and 8K videos, leading to a higher demand for more sophisticated codecs. The increased adoption of video codecs optimized for HEVC and AV1 is essential for video-on-demand services to deliver users’ streams across Spain with little to no buffering, further enhancing their experience.
• Increase in Demand for Video Conferencing Due to Remote Work: Remote working has significantly fueled the demand for video conferencing tools in Spain. With the increasing use of video calling by corporations and education centers, a need has emerged for new video codecs that work under bandwidth-limited environments. In Spain, VP9 and HEVC video codecs are being used to ensure smooth video communications in remote work and education settings without compromising the overall quality of the video.
• New Changes in VR and AR Entertainment Technologies Innovations: Virtual reality (VR) and augmented reality (AR) are rapidly rising in popularity within Spain for entertainment, gaming, or training purposes. These technologies incorporate the use of videos, hence streaming has to be done in very high quality, in real time, and with almost no lag in order to provide the user with an engaging and realistic experience. As the demand for VR and AR content increases, innovation in codec technologies to support immersive, high-resolution video with little to no delay is changing the next generation video codec market in Spain. These innovations are expected to enable the expansion of new VR and AR content, as well as new market prospects.
Changes in the Spanish next generation video codec market are causing a ripple effect of innovation across multiple industry sectors such as streaming services, immersive technologies, video conferencing, VR, and AR. The proliferation of advanced video codecs such as HEVC, VP9, and AV1, alongside the rollout of 5G networks, is changing the paradigm of creating and consuming video content. This shift is fostering the growth of Spain’s video technology system, making it an important region for the future of video codec technology.
Strategic Growth Opportunities for Next Generation Video Codec Market in Spain
The market for next generation video codecs in Spain is expected to grow significantly due to advancements in video streaming technology, the availability of high-bandwidth networks, and increasing demand for quality video content. Key industries such as OTT streaming, telecommunications, and remote work continue to expand, which will benefit from the incorporation of new codecs. The following are five opportunities that span across these fields and are transforming the video codec landscape in Spain.
• OTT Streaming Services: The adoption of OTT streaming platforms in Spain is one of the factors increasing the demand for AV1 and HEVC video codecs that enhance quality and reduce infrastructure costs. These advanced video codecs outperform others with their sophisticated compression features, allowing 4K and 8K video streaming without straining the network. Streaming service providers using these codecs will benefit from increased bandwidth and reduced latency, leading to better viewing experiences. Moreover, these advanced codecs outperform others in a competitive streaming market by providing superior video quality without increasing costs or lowering profits.
• Mobile Videos and Gaming: With the rise in smartphone usage and other mobile devices in Spain, video and gaming have become dominant forms of entertainment. High mobile video quality requirements in gaming have led service providers to adopt codecs like AV1, which offer advanced features such as smoother video playback at low bitrates. As mobile networks, especially 5G, expand, the demand for optimized video codecs that ensure ultra-low latency and high-quality video will increase, creating more opportunities for codecs in the mobile gaming and entertainment sectors. The demand for these services will continue to grow in Spain, leading to greater adoption of codecs in the mobile video and gaming sectors.
• Telecommunications and Video Conferencing: The rise in remote work in Spain has created a new demand for high-quality video conferencing solutions. The sudden surge in demand has pushed telecom companies to develop smoother and clearer video conferencing systems that use bandwidth more efficiently. Advanced video codecs are expected to achieve higher levels of productivity while using less bandwidth. The introduction of VP9 and HEVC codecs will allow low-bandwidth regions to maintain video productivity, which is crucial for video calls. The telecommunications sector will continue to seek further advancements in video compression to enable remote work, education, and other collaborative efforts.
• Virtual Reality and Augmented Reality: The adoption of virtual reality (VR) and augmented reality (AR) technologies in Spain’s entertainment and gaming industries is driving the demand for video codecs capable of compressing immersive, low-latency content. VR and AR systems require minimal latency, so high-quality video is essential to ensure a seamless experience. Specialized video codecs that meet these requirements are expected to provide significant growth in Spain’s video codec market. The rise in demand for popular VR and AR experiences will lead to increased specialization of video codecs to support these technologies.
• Broadcast and Media Industries: As Spain shifts to newer generations, its media and broadcast industries are rapidly adopting new quality standards for video content, with an increasing demand for 4K and 8K broadcasting. The use of next generation codecs like HEVC and AV1 will play a major role in this transition. These codecs enable high compression ratios, allowing broadcasters to deliver quality video content at lower infrastructure costs. Next-generation video codecs are taking the lead, with a focus on UHD content, which further supports the need for improved broadcast video delivery and media cost efficiency.
The next generation video codec market in Spain is projected to grow due to the expanding scope of OTT streaming, mobile videos and gaming, telecommunications, VR/AR, and the media and broadcasting industries. The adoption of novel codecs such as AV1 and HEVC enhances video quality, bandwidth, and cost efficiency. As Spain continues to incorporate these technologies, the video codec market will grow stronger, transforming how video content is delivered, consumed, and experienced.
Next Generation Video Codec Market in Spain Driver and Challenges
Technological, regulatory, and economic changes are affecting the next generation video codec market in Spain. The growing demand for high-quality video content has fueled the need for more efficient video compression technologies. While these drivers promote market expansion, challenges related to adoption, infrastructure, and standardization also affect the market. The following paragraphs outline the critical drivers and challenges affecting the evolution of the next generation video codec market in Spain.
The factors responsible for driving the next generation video codec market in Spain include:
• Innovations in Technology: Spain’s next generation video codec market is significantly influenced by the evolution of video compression algorithms. The development of AV1, HEVC, and VP9 codecs has optimized video quality and data consumption. These technologies enable the streaming of 4K and HD videos even in low-bandwidth areas. Spain’s media, gaming, and telecommunications industries are striving to create more sophisticated video content, and these innovations in codec technology will allow high-quality video to be delivered at lower costs, driving significant market growth.
• Growth of 4K Content: The availability of high-quality video content in Spain is increasing, largely due to the growing use of 4K and 8K videos in television and gaming. As more consumers seek UHD content, the demand for better video codecs that can handle heavy data increases. This growing demand for quality content is accelerating the adoption of next generation codecs. The AV1 codec exceeds other codecs in terms of video compression while maintaining the integrity of the content. This is particularly beneficial for regions that require rapid delivery of 4K or 8K content over mobile and broadband networks.
• Expansion of 5G Networks: The growth of 5G networks in Spain is a key factor in the expansion of the next generation video codec market. The attributes of 5G, including its capabilities in video streaming, virtual reality, augmented reality, and mobile gaming, combined with rapid infrastructure development, make it crucial for market growth. As the industry matures, there will be a greater need for video codecs with faster speeds and higher resolutions to meet demand. Video codecs like AV1 and HEVC that meet the required 5G standards will become increasingly important for uninterrupted video playback, driving market expansion in 5G environments.
• Cost Efficiency for Streaming Services: The value of AV1 video codecs lies in their ability to deliver efficient performance at low cost. This cost-effectiveness makes AV1 one of the main drivers for widespread adoption in Spain’s streaming sector. Next-generation codecs reduce the bandwidth required for streaming, allowing 4K and UHD content to be delivered at a lower cost. Streaming platforms are always looking for ways to reduce infrastructure costs while maintaining high video quality, and the new high-efficiency codecs provide an essential solution. Cost-effectiveness is a major factor driving the demand for these codecs in Spain’s video streaming industry.
• Assistance with Technology Growth: Government investment in the video industry is also boosting the next generation video codec market in Spain. Innovation-friendly policies, such as 5G and broadband expansion, support the development and adoption of next generation codecs. Spain’s adherence to EU regulations related to digital infrastructure and media services also supports the video codec industry. The evolution of regulatory policies will continue to influence the adoption and development of next generation video codecs.
Challenges in the next generation video codec market in Spain are:
• Heavy Upfront Infrastructure Investments: One of the major challenges in the next generation video codec market in Spain is the high upfront investment in infrastructure required to support new codecs. While these codecs can eliminate ongoing expenses, the need for expensive hardware, software, and network investments presents a challenge for service providers and smaller companies. This issue could limit the adoption of advanced video codecs to larger companies, leaving smaller streaming platforms and telecom providers unable to deploy such technologies due to a lack of adequate funds.
• Issues Regarding Compatibility and Standardization: A major challenge faced by market players is the lack of universal compatibility and standardization of next generation video codecs across regions and formats. Different platforms, devices, and networks may adopt different codecs, leading to interoperability issues. Achieving compatibility across a wide range of devices and platforms is essential for widespread adoption of sophisticated video codecs. Without clear standards, the market risks fragmentation, which could hinder the unified integration of these codecs in Spain’s video ecosystem.
• Readiness of End Users for High-Resolution Content: Despite the availability of high-resolution content such as 4K and 8K, consumer readiness to adopt these technologies in Spain remains low. A significant number of consumers may not have the necessary hardware or the required broadband connections to take full advantage of next generation video codecs. Service providers will need to ensure that consumers have access to the necessary hardware and adequate network speeds to facilitate seamless integration.
The demand for next generation video codecs in Spain is being driven by technological advancements, a focus on high-quality content, the expansion of 5G networks, affordable streaming subscription models, and favorable regulations. However, challenges such as high initial infrastructure costs, low readiness among consumers, compatibility issues, and limited consumer willingness still persist. Despite these obstacles, the video codec market in Spain shows great growth potential, driven by the key factors poised to transform the future of video content distribution.
List of Next Generation Video Codec Market in Spain Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies, next generation video codec companies cater to increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the next generation video codec companies profiled in this report include:
• Company 1
• Company 2
• Company 3
• Company 4
• Company 5
• Company 6
• Company 7
• Company 8
• Company 9
• Company 10
Next Generation Video Codec Market in Spain by Segment
The study includes a forecast for the next generation video codec market in Spain by video codecs type and application.
Next Generation Video Codec Market in Spain by Video Codecs Type [Analysis by Value from 2019 to 2031]:
• AVC
• AV1
• HEVC
• VP9
• VVC
Next Generation Video Codec Market in Spain by Application [Analysis by Value from 2019 to 2031]:
• Mobile Phone
• Computer
• TV
• Others
Features of the Next Generation Video Codec Market in Spain
Market Size Estimates: Next generation video codec in Spain market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends and forecasts by various segments.
Segmentation Analysis: Next generation video codec in Spain market size by video codecs type and application in terms of value ($B).
Growth Opportunities: Analysis of growth opportunities in different video codecs type and application for the next generation video codec in Spain.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the next generation video codec in Spain.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
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FAQ
Q1. What are the major drivers influencing the growth of the next generation video codec market in Spain?
Answer: The major drivers for this market are growing demand for better video experience, increasing mobile video consumption, and proliferation of video content across platforms.
Q2. What are the major segments for next generation video codec market in Spain?
Answer: The future of the next generation video codec market in Spain looks promising with opportunities in the mobile phone, computer, and TV markets.
Q3. Which next generation video codec market segment in Spain will be the largest in future?
Answer: Lucintel forecasts that HEVC segment will remain the largest segment over the forecast period due to cuts the necessary bitrate in half while maintaining similar image quality, but at the cost of more processing complexity.
Q4. Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 10 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the next generation video codec market in Spain by video codecs type (AVC, AV1, HEVC, VP9, and VVC), and application (mobile phone, computer, TV, and others)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.4. What are the business risks and competitive threats in this market?
Q.5. What are the emerging trends in this market and the reasons behind them?
Q.6. What are some of the changing demands of customers in the market?
Q.7. What are the new developments in the market? Which companies are leading these developments?
Q.8. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.9. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.10. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
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