Archive for September, 2009

Top Five Improving Brands in Broadcast Technology

Broadcast Vendor Brand Research, Top Broadcast Vendor Brands, broadcast industry technology trends, broadcast technology market research | Posted by Joe Zaller
Sep 28 2009

This is the fifth in a series of posts about how the brands of broadcast technology vendors were ranked in a variety of categories in the 2009 Big Broadcast Survey (BBS), which includes responses from nearly 5,000 people in 110 countries.  (For information about how these results were collected, please see the bottom of this post)*.

Previous posts on this subject have looked at how broadcast technology vendor brands were ranked by BBS respondents in terms of overall opinion, customer service, reliability and innovation. 

These are great metrics, but I also wanted to know which brands are perceived as getting better or getting worse in the global marketplace.  To find out, I presented BBS participants with a list of 25 broadcast technology vendors and asked whether their opinion of the company had “got better,”  “stayed the same” or “got worse” over the past 2-3 years.

Once I had these results was able to calculate the “Net Change in Brand Image” for each company by using the following formula:

GB-GW/# of total respondents = Net Change in Brand Image

In other words, I subtracted the “got worse” number from the “got better” number for each company (ignoring the “stayed the same” number), and then converted this into a percentage of the total for each vendor.

Evaluating the change in brand image in this way takes into account both the positive and negative perceptions of brands.  It turns out that some brands are more polarizing than others – meaning that a strong “got better” response might be cancelled out by a strong “got worse” response.  As a result some companies who were rated in the top five on just the “got better” score were not included in the global or regional top five because their high “got worse” score dragged down their overall result.  At the same time, a few of the companies with high “got worse” scores still made the top 5 list because these negative scores were cancelled out by even higher “got better” scores.

The table below summarizes the results by showing the vendors who were ranked in the top five for “net change in brand image.”  In order to show geographic variation, these results are presented globally as well as regionally.

 

Please note that in all cases, these brands are shown in alphabetical order, NOT in the order of their ranking in the study.

 

Top Five Net Improving Broadcast Technology Vendor Brands, Globally and Regionally

  

Net Change in Brand Image

 

Like most other measures, the top five spots on a global basis were taken by large and/or well-established players.  However, there are some interesting regional trends that are worth further investigation.

Several companies achieved a top five spot in one or more of the regions, but were not ranked in the top five on a global basis.  These include Harris, Miranda Technologies, Quantel and Snell & Wilcox.  Harris and Miranda were ranked in the top five in two regions.  The following chart shows a breakdown of companies that achieved a top five ranking on a regional basis, but were not ranked in the top five on a global basis.

Achieved Top Five in One or More Regions, but not Globally

Company EMEA AMERICAS ASIA-PAC
Harris

 

X

X
Miranda

X

X

 
Quantel

 

 

X
Snell & Wilcox

X

 

 

 

When considering the companies that placed in the top five on a global basis, it’s interesting to note that no single company placed in the top 5 in all three geographic regions.  Four of the global top 5 placed in the top 5 in two regions, while one vendor – Omneon – achieved a top 5 position in just one region, but still achieved a top 5 position on a global basis.  

Here’s a breakdown of where each of the top five global companies achieved a top five spot on a regional basis:

Where Global Top Five Also Achieved Top 5 Position Regionally

Company EMEA AMERICAS ASIA-PAC
Evertz

X

X

 
EVS

X

 

X
Omneon

X

 

 
Sony

 

X

X
Thomson / Grass Valley

 

X

X

 

Sony and Thomson / Grass Valley had similar profiles, scoring in the top 5 in both Asia-Pacific and the Americas.  EVS was in the top five on EMEA and Asia-Pac; and Evertz was in the top five in EMEA and the Americas.  Omneon’s strong regional showing in EMEA (presumably combined with scores just outside of the top five in other regions), was enough to put it in the top five globally.

The net change in brand image provides good insight into how brands are perceived by the market, but it needs to be taken in the context of a variety of other measures as well, since a high score in this category is the result of many factors.  Indeed the companies in the top five in “net change in brand image” also achieved high marks in other categories. For example, EVS scored very well in the customer service category (the only company to be in the top five in all geographic regions), and was also ranked in the top five for innovation on a global basis, along with both Sony and Thomson / Grass Valley.   

A top 5 score in the “Net Change in Brand Image” category, on a regional or global basis is an important achievement for any brand.  The companies in this group are perceived by the market in a vey positive light.  Whether they are perceived as a consistent performer who is doing things right, and getting better; or as a dynamic up and coming company, this measure facilitates a deeper understanding of the industry brand leaders.

 

* Respondents to the BBS were asked to rank their opinion of twenty-five broadcast technology vendor brands in a variety of categories including awareness; overall opinion; change of opinion; recommendation; and a variety of brand attributes and brand drivers.  The responses were then aggregated into a series of industry “league tables” that rank each broadcast technology vendor brand against the metrics mentioned above. You can download a free 26 page summary of some of the key findings of this study here.

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Silverwood Partners’ Take on IBC 2009

Broadcast technology vendor financials, broadcast technology market research | Posted by Joe Zaller
Sep 25 2009

 Specialist investment bank Silverwood Partners today issued a note called “IBC 2009 Perspectives.”

I thought it was an interesting take on the show and on the industry, and it’s worth sharing.

 

September 25, 2009 – IBC 2009 was an active show that reflected the transformative changes taking place in the media technology industry. We would like to share our perspectives from the event.

1. Challenging Environment in Broadcast Technology.   Broadcast customers are losing revenue from their traditional business as advertising dollars are being siphoned off to online alternatives. Concurrently, the broadcast industry is moving toward a lower cost, file-based infrastructure, with high-performance technology available at a fraction of traditional cost. Neither trend is good for the pricing power or the margins of incumbent companies. Some have cut costs to outpace the revenue decline; some have found other revenue streams. Many traditional vendors have enjoyed a stable business environment, with high margins, for years, and some will find it difficult to make the necessary business adjustments.

2.  DTV and HD Shifts Nearing Completion.  The Digital TV transition and the HD transition are substantially complete, and have in each case provided a boost to the broadcast technology industry.  The related capital investment has masked the underlying poor fundamentals of the industry.  As the stimulus from these trends abates, broadcast technology suppliers will be increasingly exposed to the fundamental weakness of demand in the industry.

3.  Revenue Flow vs. Work Flow.   As the influence of the online medium grows and media outlets proliferate, broadcasters are being forced to focus on monetization and revenue generation rather than primarily workflow and program delivery.  Traditional broadcast technology buyers are inexperienced with the technology framework of the online medium.  Such buyers are actively seeking assistance in solving immediate and unfamiliar problems that involve not just the technology infrastructure but also the business model.  Related customer inquiry is driving acquisition interest within the sector.

4.  Abundance of Acquisition Opportunities – Importance of Differentiation.  The recent economic disruption has exacerbated the structural changes in the broadcast industry and has driven many companies to look at strategic alternatives.  For well-capitalized companies this is a favorable time to look at acquiring competitive and complementary technologies. Large companies are evaluating many transaction opportunities and are being highly selective in their acquisition strategies. It is important for prospective sellers to understand the value and differentiation represented by their business or technology, and to directly relate the distinction to a prospective buyer’s specific objectives.  

5.  Unique Opportunity for Smaller Technology Companies.  Historically, decision makers behind key technology purchases at large customers reflexively avoided smaller suppliers and principally sourced key technologies from large, well-known companies.  In the current environment, smaller, innovative companies can be more responsive to the rapidly evolving needs of media technology customers.  With the broadcast business model changing as a result of, and as a response to, fundamental technology shifts there is a unique opportunity to capture a leading position in a rapidly growing market.  

Silverwood is actively involved in a number of transactions for companies that were exhibitors at IBC, and we have an informed and current perspective on transaction structuring, pricing and feasibility.

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Impressions of IBC 2009

broadcast industry technology trends, broadcast technology market research | Posted by Joe Zaller
Sep 17 2009

I am just back from spending a week at the IBC show in Amsterdam.  During the four days I was at the show I had about 50 meetings with vendors, broadcasters, bankers and other industry folks.  Here are my quick impressions.

The story from many vendors was the same — the first half of 2009 was terrible, with sales down between 15-40% depending on the company.  A few went as far to comment on the impact on their profit — e.g. one told me that at 20% drop in revenue resulted in a 50% drop in profit.  However, one or two told me that things had picked up since June.

Although attendance was down just about 7% versus last year, there were big differences in how this impacted the lead counts of individual exhibitors.  Most vendors said that their lead counts were down — a few told me that their leads were down 40% versus previous shows — while others said they were busier than ever.  And of course, I often heard the old refrain “the show is smaller but the quality is high because anyone here is here because they have a project, and the tire kickers stayed at home.”

Many vendors reported that although their sales were way down for the year, that their pipeline had not gone away.  Instead projects were being constantly delayed as broadcasters evaluate their capital budgets.  So many vendors said that they are optimistic that there will be pent up demand when the economy finally turns and that things will improve quickly once a recovery starts.  In the meanwhile however, many vendors have found reduced demand combined with project postponement has made their sales very lumpy, and in most cases extremely difficult to predict.  A few people commented on how difficult it is to forecast demand in the current environment.

There were a few bright spots.  Just about everyone whose business involves saving money and improving efficiency for broadcasters reported that things went well at IBC.  And Ross Video was quoted in the IBC Daily News saying that their sales were up 8% during the first ten months of their financial year (perhaps due to their OverDrive production automation system, which reduces headcount and saves money for broadcasters).  A couple of magazine publishers also reported that orders for display advertising in Q4 had come in higher than expected during IBC.

Following on from the above it seems, as TV Technology twittered today “What do you think was the dominant theme at#ibc09? My pick? “Doing more with less.” Not particularly original, but a sign of the times.”

I agree with TV Tech, but I think there’s more to it than that.

The broadcast industry in the midst of significant structural changes.  We’ve in the middle of the worst recession in memory and technology is changing at a rapid pace.  There are significant implications to the combination of customer budget cuts and new technology.

A while back, I posted an article called  HDTV… just a “pause” on the path to transition to IT-based broadcasting? which said that the transition to HD (much of which had to be done with hardware), put back the move to IT-based broadcasting by about five years.  During the biggest years of the HD transition, many vendors grew very rapidly, including a few that went public.  Today, the transition to HD is well underway, and the focus of the customers is all about efficiency.   So it makes me wonder whether when the recovery does happen, who will reap the biggest benefit — the traditional hardware vendors, or providers of efficient IT-based systems.  I think we will see some new players emerge, while some established players continue to struggle.

This leads to the (not new) observation about the high degree of fragmentation among the broadcast technology vendor community.   What is new is what I think we will see next – vendor consolidation and a pretty active M&A market in the broadcast technology space.

Why? Well for one thing there are just too many vendors in a variety of product categories, and they are seeing their business change.  Many of the small players may be forced to merge or sell over the next few years.

And of course, when you combine the premise that it’s likely to be some of the newer companies (who provide a bridge to the file-based future) that are going to grow fastest for the next few years, with the premise that many of the established hardware-based vendors don’t actually have a file-based solution to offer their customers, it’s likely that we’ll be seeing more M&A activity in the near future.

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Evertz Posts Results for Quarter Ending July 31, 2009

Broadcast Vendor Brand Research, Broadcast technology vendor financials, broadcast industry technology trends, broadcast technology market research | Posted by Joe Zaller
Sep 09 2009

Yesterday afternoon, Evertz posted their results for Q1 2010 (ended 7/31/09).

Here’s how these results compared to the same quarter a year ago:

* Revenue was $72m, up 6% overall

* US and Canada revenue down 7%

* International revenue (defined as outside the US and Canada) up 32%

* Earnings down about 20% — C$17.1m vs. C$21.4

* EPS C$.21 vs. C$.29

* R&D spend up $1.1m to $7.3m, up 17%

* C$4.1m FX loss vs. a gain of C$.04m

The US / Canada decrease in sales is perhaps not unsurprising given the economic conditions.  Seeing the international sales increase is very encouraging. 

On the earnings conference call Evertz executives declined to say where the international growth came from, but did mention that capita budgets of international state broadcasters (i.e. not advertiser funded) were somewhat more resilient than their commercial counterparts.  They also highlighted the fact that the company had recently completed a three week long international “roadshow,” during which the company put a large number of staff and C$1m worth of equipment on the road in support of international customers and channel partners. 

Here’s a link to the earnings press release.

If you want to listen to the earnings conference call rebroadcast, here are the numbers:

416-915-1035 or Toll-Free 1-866-245-6755

Pass code 254880.

Edit this entry.

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Overall Opinion Rankings for Broadcast Technology Vendors

Broadcast Vendor Brand Research, Top Broadcast Vendor Brands, broadcast industry technology trends, broadcast technology market research | Posted by Joe Zaller
Sep 08 2009

This is the fourth in a series of posts about how the brands of broadcast technology vendors were ranked in a variety of categories in the 2009 Big Broadcast Survey (BBS), which includes responses from nearly 5,000 people in 110 countries.  (For information about how these results were collected, please see the bottom of this post)*.

I have written previously about how broadcast technology vendors were ranked by BBS respondents in terms of customer service, reliability and innovation.  Now let’s look at which broadcast technology vendors are ranked highest in “overall opinion” by broadcast industry insiders around the world. 

Study participants were presented with a list of vendors and asked to rate them on a scale of 1-10 based on their overall opinion of the company.  The table below summarizes the results by showing the vendors who were ranked in the top five for “overall opinion.”  In order to show geographic variation, these results are presented globally as well as regionally.

 

Please note that in all cases, these brands are shown in alphabetical order, NOT in the order of their ranking in the study

  

Question: On a scale of 1-10, where 1 = very poor and 10 = best in the market, please rate your overall opinion of each of these broadcast technology vendor brands.

GLOBAL

EMEA

AMERICAS

ASIA PACIFIC

EVS

Harris

Snell & Wilcox

Sony

Thomson / Grass Valley

EVS

Omneon

Snell & Wilcox

Sony

Thomson / Grass Valley

Evertz

Harris

Snell & Wilcox

Sony

Thomson / Grass Valley

EVS

Harris

Snell & Wilcox

Sony

Thomson / Grass Valley

  

On a global basis, the top five spots were taken by large and/or well-established players, with three companies – Snell & Wilcox, Sony and Thomson / Grass Valley — taking one of the top 5 spots in all three geographic regions, as well as in the overall rankings. 

Strong regional showings by both EVS and Harris were enough to put them into the top 5 overall, despite being ranked outside of the top 5 in the Americas and EMEA respectively.

The other vendors ranked in top five in one of the regions were Omneon and Evertz, who appeared in the top 5 ranking in EMEA and the Americas respectively.

Of course “overall opinion” is a subjective measure and does not necessarily imply superior brand loyalty or purchase intent.  However, being ranked as one of the top industry companies  in this category by respondents worldwide is still an important achievement, and the vendors that were ranked highest in terms of overall opinion scored well in other measures.  For example, EVS scored very well in the customer service category (the only company to be in the top five in all geographic regions);  S&W, Sony and Thomson / Grass Valley all scored in the top 5 for reliability; and Harris and EVS were in the top five for innovation on a global basis.

 

* Respondents to the BBS were asked to rank their opinion of twenty-five broadcast technology vendor brands in a variety of categories including awareness; overall opinion; change of opinion; recommendation; and a variety of brand attributes and brand drivers.  The responses were then aggregated into a series of industry “league tables” that rank each broadcast technology vendor brand against the metrics mentioned above.

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A Ranking of Broadcast Technology Vendors for “Great Customer Service”

Broadcast Vendor Brand Research, broadcast industry technology trends, broadcast technology market research | Posted by Joe Zaller
Sep 02 2009

This is the third in a series of posts about how the brands of broadcast technology were ranked in a variety of categories in the 2009 Big Broadcast Survey (BBS), which includes responses from nearly 5,000 people in 110 countries.  (For information about how these results were collected, please see the bottom of this post)*.

In previous posts I have discussed how broadcast technology vendors were ranked by BBS respondents in terms of reliability and innovation.  This post focuses on something that all customers care about deeply — customer service. 

In order to get a true feel about what respondents think about the service offered by broadcast technology vendors, I didn’t just ask about customer service — instead I asked about “great customer service” so that I could really gauge which vendors truly deliver excellence in this area.

The vendors who were ranked in the top five for “great customer service” are shown in the table below.  In order to show geographic variation, these results are presented globally as well as regionally.

 

Please note that in all cases, these brands are shown in alphabetical order, NOT in the order of their ranking in the study

  

 Question: How would you rate [Brand X] on the following attribute [Great Customer Service] where 1 = very poor and 10 = best in the market?

GLOBAL EMEA AMERICAS ASIA PACIFIC

Evertz

EVS

Snell & Wilcox

Sony

Thomson / Grass Valley

Axon

Crispin

EVS

Snell & Wilcox

Sony

Evertz

EVS

Ross Video

Sony

Thomson / Grass Valley

EVS

Florical

Snell & Wilcox

Sony

Thomson / Grass Valley

  

On a global basis, the top five spots were taken by large and/or well-established players.  However, things were different on a regional basis.

Only two companies — EVS and Sony — managed to achieve a top 5 spot across all three regions, and unlike just about any other metric in my research, including the ones that I have discussed previously, the top five regional spots were not necessarily taken by the broadcast industry’s largest vendors.

In EMEA, four of the top five spots were taken by smaller players — Axon, Crispin, EVS and Snell & Wilcox — although the latter two are not insignificant players and are well established.

In the  Americas, strong regional players Evertz and Ross made the list along with EVS Sony and Thomson / GVG.  Interestingly, the strong showing made by Evertz in this market was enough to propel it to a top 5 spot in the global league table ranking, despite the fact that the company did not make the top 5 in either EMEA or Asia-Pacific.

In Asia, the large  and well established vendors were joined by Florical, a small US-based provider of broadcast automation.   

There are a couple of interesting take-aways from these findings. 

Although you can’t see it here (beacuse this post does not show the full league table), it’s worth noting that on an overall basis, respondents to the BBS were much stingier with their “grades” in this category compared to all the others.  Many companies received very high scores for metrics like “overall opinion,” “innovation,” “reliability” etc., but no company was ranked “off the charts” in terms of the perception of “great customer service.” 

Because of this, it’s clear to me that there is a real opportunity for vendors to step up to the plate and differentiate themselves on the basis of great customer service.  Whoever does this will be rewarded by their customers with increased loyalty.

The good news is that my research shows that a commitment to great customer service can be made by all vendors, whether they are large or small.  Indeed, a review of the rankings in the industry league table for “great customer service” shows that this can be achieved by small vendors as well as large ones.  Let’s hope that more companies make this a central part of their strategy in the future.

 

 

* Respondents to the BBS were asked to rank their opinion of twenty-five broadcast technology vendor brands in a variety of categories including awareness; overall opinion; change of opinion; recommendation; and a variety of brand attributes and brand drivers.  The responses were then aggregated into a series of industry “league tables” that rank each broadcast technology vendor brand against the metrics mentioned above.

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