Next Generation Video Codec in Mexico Trends and Forecast
The future of the next generation video codec market in Mexico 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 Mexico 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 Mexico
Streaming video codecs are becoming increasingly critical in Mexico as the demand for quality video streaming, new technologies, and digital infrastructure development rises. The widespread adoption of 5G technology in the country, coupled with OTT platforms and other high-definition infrastructure, heightens the need for next generation video codecs that allow for accurate and quality video compression and transmission. These codecs are essential for delivering videos across multiple industries, including entertainment, education, and business communication.
• Building Out 5G Networks in Mexico is Driving Demand for Streaming Video: In Mexico, there is an increased demand for mobile and OTT streaming platforms due to the growing deployment of 5G networks. The leaps in mobile speeds, along with lower latency, bring ready access to 4K and even 8K streaming. Shifts like this require enhanced codecs so that video files do not become burdensome in terms of data consumption. Next-generation codecs such as AV1 and HEVC will be key to strengthening video delivery and improving the user experience while supporting the towering demands of mobile video streaming.
• Content Delivery Optimization Alongside OTT Streaming is Thriving: In Mexico, competitors like Netflix, Claro Video, Amazon Prime Video, and other companies are increasing their presence in the market. As more consumers seek HD content, they also expect more sophisticated and efficient video codecs to be incorporated into their systems to deliver good-quality video with minimum bandwidth usage. The adoption of HEVC and AV1 will enable these platforms to lower the bitrate while still maintaining high visual quality. These shifts are increasing the demand for advanced video compression solutions, due to the boom in OTT streaming across Mexico.
• Growth of E-Learning and Digital Education Driving Codec Adoption: The rise of e-learning and digital education in Mexico is accelerating the demand for new-age video codecs. This boom was further amplified by the COVID-19 pandemic, which forced educational institutions to undergo significant shifts. Educational institutions and e-learning platforms are increasingly adopting video content for online classes, webinars, and training. This has further escalated the importance of advanced video codecs, which can provide clear, uninterrupted video content even under low bandwidth conditions. The growing use of video for education is creating a demand for highly sophisticated codecs that allow efficient streaming and video-on-demand services.
• Broadcasting Industry Upgrades to 4K and 8K Content: The broadcasting sector in Mexico is gradually adopting high-definition and ultra-high-definition 4K and 8K broadcast content. This change requires advanced video codecs capable of compressing large, high-quality video files for easy transmission while maintaining video integrity. The use of HEVC and AV1 codecs in Wi-Fi-connected broadcast networks will ensure quality delivery at lower bandwidths. With the steady rise in demand for high resolution, these codecs will prove instrumental in improving services nationwide.
• Trends in the Next Generation Video Codec Market in Mexico: The latest trends in the next generation video codec market in Mexico are associated with the expansion of 5G networks, the growth of OTT services, the digital transformation of education, and the rising demand for quality video content across various industries. The wide adoption of cutting-edge video codecs like HEVC and AV1 is crucial for efficient video delivery, reducing bandwidth, and improving the overall user experience. These trends are pivotal in transforming the video streaming, broadcasting, and education industries, making next generation codecs a critical element of Mexico’s digitalization process.
The next generation video codec market in Mexico is rapidly advancing, driven by technological innovations, growing demand for video content, and the country’s ongoing digital transformation. As internet speeds improve and OTT services continue to expand, there is a growing need for efficient video codecs that enable high-definition video streaming. Video codecs like HEVC and AV1 are becoming increasingly popular because they achieve improved compression ratios while retaining video quality. These advancements are aiding the proliferation of next generation video codecs in Mexico.
Recent Developments in the Next Generation Video Codec Market in Mexico
OTT subscriptions in Mexico are on the rise, thanks to both regional content producers and international services. As the demand for 4K and even 8K video content rises, more video streaming platforms are employing next generation codecs like AV1 and HEVC. These codecs allow platforms to create visually appealing content without sacrificing bandwidth by ensuring smooth streaming in regions with poor internet connectivity. The rapid growth of the OTT sector is driving the demand for efficient video codecs.
• Adoption of 5G Networks and Enhanced Video Streaming: The advancement of 5G networks in Mexico is improving mobile internet speeds and reducing lag, thereby accelerating the adoption of next generation video codecs. With more people consuming mobile videos, especially 4K videos, advanced compression technologies are essential to ensure optimal video quality across mobile networks. These factors explain why HEVC and AV1 codecs are in high demand. They help consumers access quality video streaming without heavy data usage and support the wider distribution of 5G in Mexico.
• Increasing Remote Education and Digital Learning: The increase in remote classes taken by students has enhanced the demand for video content on learning platforms within Mexico. Educational facilities and organizations are using videos, webinars, and lectures as teaching materials. Newer generations of video codecs are becoming important to provide ease of use and high-quality videos, even in areas with low bandwidth. Incorporating effective codecs helps ensure that a wider audience receives informative content, which enhances e-learning in Mexico.
• Increase of International and Local Content Creation: The advancement of video content creation across Mexico and the world requires better video codecs. Producers in Mexico are creating more and more videos, from YouTube channels to more sophisticated video productions. Next-generation video codecs make it possible to effectively compress content, minimizing storage and transmission expenses while ensuring high video quality. This has helped propel the use of next generation video technologies in Mexico for content creation and distribution.
• Investment in Video Infrastructure and CDNs: Investments are being made towards video infrastructure and content delivery networks (CDNs) in response to the rising demand for high-quality video content in Mexico. These investments aim to optimize the delivery of video content across the country so that consumers can watch videos with minimal buffering and in high resolution. Mexican CDNs are likely to benefit from adopting advanced video codecs, such as AV1 and HEVC, due to improved compression ratios, bandwidth savings, better quality of experience (QoE), and higher adoption of next generation video codecs.
Mexico’s evolution in the video codec industry is driven by improvements in mobile bandwidth with 5G, a larger audience gained through OTT streaming, a greater focus on digital learning, and improved video infrastructure. These factors increase the level and scope of modern technology applications in the industry. As these phenomena advance, there is a greater need for efficient compression and delivery of video content. The combined efforts of these factors will ensure an upgrade within the next generation video codec business in Mexico, guaranteeing optimization in streaming, content delivery, and digital interactions across the country.
Strategic Growth Opportunities for Next Generation Video Codec Market in Mexico
Developments in video technologies, growth in mobile videos, and the expansion of OTT services are key drivers of the next generation video codec market in Mexico. The rollout of 5G connections, coupled with the rising demand for high-quality video content, provides considerable growth potential for video codecs. This growth applies across the entire vertical, including video streaming, mobile communication, education, broadcasting, and content creation, offering ample opportunities for codec development and innovation to increase efficacy and improve overall user experience.
• Growth and Development of OTT Video Streaming: High internet connectivity rates and the booming popularity of platforms like Netflix, Disney+, and many other local streaming services are driving the growth of the OTT video streaming market in Mexico. Next-generation video codecs, such as HEVC and AV1, are becoming more mainstream as the demand for 4K and even 8K video content increases. With these codecs, content providers can offer high-definition videos with minimal bandwidth consumption, increasing OTT service providers’ ability to widen their scope and customer base across the Mexican market.
• 5G Network Rollout and Mobile Streaming: The rollout of 5G networks in Mexico is generating even greater demand for mobile streaming. Efficient video compression is necessary for users to stream 8K and 4K video content without buffering. Additionally, mobile service providers can enhance the mobile video experience by enabling streaming in areas with low internet speed. Next-generation codecs like AV1 and HEVC can reduce bandwidth while maintaining excellent video quality. The adoption of these codecs will dramatically support the increase in mobile video consumption in Mexico.
• Digital Transformation in Education: As Mexico progressively shifts toward video-based learning, the need for efficient delivery of such videos is paramount. Schools, colleges/universities, and e-learning platforms need high-quality videos to deliver lectures, webinars, and virtual classes. This will enable effortless access to educational content regardless of location. Adopting advanced video codecs like AV1 and HEVC will allow institutions to deliver high-definition content while saving data. This transformation will accelerate digital education and e-learning growth in Mexico.
• Broadcasting Industry Upgrade to HD and UHD Content: Similar to the global trend, Mexico’s broadcasting industry is adopting high-definition (HD) and ultra-high-definition (UHD) content due to the growing consumer demand for high-quality video. Next-generation video codecs, HEVC and AV1, are crucial components of this advancement. These codecs utilize data compression to reduce the size of video files, which in turn saves resources in storage and data transmission without sacrificing quality. As the need for 4K and 8K broadcasts rises, these codecs will enable broadcasters to deliver abundant, high-quality content, thus improving the broadcasting industry and the viewing experience in Mexico.
• Growth in Content Creation and Distribution: The emergence of content creation platforms (most notably, YouTube) and the growth of the professional video production industry are driving the demand for more efficient video codecs. Content creators in Mexico need performant video codecs that make it easy to share content across different platforms. Next-generation video codecs, such as AV1, eliminate file size restrictions, improve casting, and broaden audience reach. This opportunity accounts for the increase in production and distribution of videos, enabling talented Mexican content creators to produce high-quality videos.
Mexico’s next generation video codec market growth potential is greatly driven by the demand for video quality in OTT streaming, mobile services, digital education, broadcasting, and content creation. Advanced technologies like 5G and the growing demand for 4K/8K content will make high-efficiency video codecs crucial. These changes will facilitate the transformation of the video ecosystem, improving user experiences and the reach of video content across industries and platforms within Mexico.
Next Generation Video Codec Market in Mexico Driver and Challenges
The demand for advanced video compression technologies in Mexico directly affects the next generation video codec market through various drivers and challenges. About efficient video codecs, technological, economic, and regulatory factors are positive, whereas infrastructure, costs, and market readiness pose barriers to widespread adoption. Understanding these complexities is critical to fully capitalizing on the prospects offered by next generation codecs.
The factors responsible for driving the next generation video codec market in Mexico include:
• Striving Need for Great Video Content: The sustained influx of OTT services, mobile devices, and cable broadcasting is rapidly increasing the demand for video codecs. In Mexico, consumers are increasingly demanding Video on Demand (VOD) with 4K and 8K resolution support. There is an urgent need from content providers and streaming platforms to use more advanced video codecs that will allow greater efficiency in bandwidth utilization and superior video quality. The most sought-after compression technologies are HEVC and AV1, and their adaptability will mark a shift toward higher video quality.
• Growth in Mobile Infrastructure (5G): The next generation video codec market is bolstered by the introduction of 5G networks throughout Mexico. The ability to stream mobile video using 5G is predicted to grow rapidly due to increased speeds and reduced latency. This also means new video codecs will need to be created that can deliver high-quality video with limited data caps. The speed increase provided by AV1 and HEVC adoption will be especially noticeable while working with 4K and 8K video, meeting the demands of both consumers and service providers.
• Digital Transformation in Education: In Mexico, there is an accelerated shift toward digital learning and online education. This shift has increased the demand for video content. Educational institutions and e-learning platforms across the country need effective video codecs to ensure lessons are delivered clearly and effectively. This digitization shift is making it possible for compression technologies that improve video quality and reduce bandwidth usage to become critical in remote and underserved areas. The growth of e-learning means that next generation video codecs will need to be embraced by the education sector, testing their limits.
• Expansion of OTT Services and Content Creation: In Mexico, the expansion of OTT services and content creation has become one of the primary catalysts driving the adoption of next generation video codecs. The entry of both local and foreign content providers has led to a stronger demand for video codecs that enable high-quality video delivery across multiple devices. Advanced codecs like AV1 allow content providers to improve video experiences, reduce data usage, and expand their reach. It is clear that the increased focus on local content creation and distribution is driving codec adoption in the nation.
• Elevated Standards of Customer Experience: Mexico has seen an increased number of customers demanding a multi-screen viewing environment, whereby they expect to view video content on smartphones, smart TVs, and laptops. The continual rise of video streaming, mobile broadcasting, and content consumption has greatly propelled the need for high-quality video delivery. The demand for better compression ratios only increases, and along with it, the codecs in the market should meet the need for excellent quality without sacrificing any elements. High demand for seamless, pristine video quality will play a major role in driving the adoption of next generation video codecs in the market.
Challenges in the next generation video codec market in Mexico are:
• Constraints of Existing Backgrounds and Networks: The existing constraints in Mexico’s rural and underserved regions greatly challenge the growth of the next generation video codec market. Network infrastructure limitations restrict the availability of services to consumers who need them. While the expansion of 5G networks certainly helps rural regions, many still face slower internet speeds. These factors, along with video streaming and high-quality broadcasting, make it difficult for platforms to reach the entire intended customer base. Efficient video codecs will help resolve these challenges, especially in relation to infrastructure. Removing these obstacles will enable the adoption of video streaming in any region.
• Cost of Implementation: When implementing new video codecs like AV1, small and medium-sized businesses in Mexico face challenges that need to be addressed. These businesses may hesitate to invest in the required hardware, software, and training. Cost efficiency is crucial during codec implementation if the goal is to foster faster adoption across industries. Addressing these challenges requires cost-effective measures and incentives that encourage the shift to modern video codecs.
• Regulatory Barriers and Licensing Issues: Finally, Mexico’s legal structure is another barrier to the adoption of modern video technologies and codecs. The video technology market is hindered by licensing costs and regulatory barriers that are too restrictive. To ensure companies adopting modern video codecs do not face legal and financial restrictions, these issues need to be resolved. Improving legal processes and offering incentives for the adoption of new video technology will boost the acceptance of these modern video codecs in Mexico.
The next generation video codec market in Mexico is poised to grow due to the demand for high-quality video content, developments in mobile networks, digital transformation in education, increased OTT services, and growing consumer expectations. However, the market’s growth potential is still hindered by infrastructure constraints, implementation cost issues, and regulatory challenges. Mexico’s video codec market can continue to grow, but only if these challenges are overcome and existing market drivers are fully exploited. Innovation and further enhancement of video delivery across industries will fundamentally change the way and quality of videos are delivered.
List of Next Generation Video Codec Market in Mexico 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 Mexico by Segment
The study includes a forecast for the next generation video codec market in Mexico by video codecs type and application.
Next Generation Video Codec Market in Mexico by Video Codecs Type [Analysis by Value from 2019 to 2031]:
• AVC
• AV1
• HEVC
• VP9
• VVC
Next Generation Video Codec Market in Mexico by Application [Analysis by Value from 2019 to 2031]:
• Mobile Phone
• Computer
• TV
• Others
Features of the Next Generation Video Codec Market in Mexico
Market Size Estimates: Next generation video codec in Mexico 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 Mexico 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 Mexico.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the next generation video codec in Mexico.
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 Mexico?
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 Mexico?
Answer: The future of the next generation video codec market in Mexico looks promising with opportunities in the mobile phone, computer, and TV markets.
Q3. Which next generation video codec market segment in Mexico 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 Mexico 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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