Archive for December, 2010

2010 BROADCAST RESEARCH FINDINGS

broadcast technology market research | Posted by Joe Zaller
Dec 31 2010

Selected Market Research Findings from the 2010 Big Broadcast Survey

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The Commercial Drivers for Multi-Platform Content Distribution in the Broadcast Industry

Multi-platform content delivery was the top industry trends in the 2010 Big Broadcast Survey.  This article looks at the commercial drivers behind the top trend in the 2010 BBS Trend Index, multi-platform content delivery, and sheds light on why multi-platform content delivery is important to broadcast professionals world-wide.

What are the Commercial Drivers for the Global Move to File-Based Operations in the Broadcast Industry?

According to our research, the move to file-based operations was the #2 ranked trend in the broadcast industry in 2010.  To better understand the importance of this trend, we asked a global sample of broadcast professionals to tell us why the move to file-based operations is so important to them.  Reasons cited include:

  • To increase speed and efficiency in the production process.
  • Enabling multi-platform content distribution and monetization
  • Reduce headcount and therefore cost
  • To take advantage of lower cost / generic IT technology
  • To deliver more channels / services with significantly increasing cost
  • To eliminate errors

Broadcast Technology Vendors Predict Strong Increase in Software Revenue

Our research indicates that the move to IT-based operations is one of the broadcast industry’s most important technology trends. This will obviously have a major impact on the broadcast technology vendor community.  So what are broadcast technology vendors doing to change their product ranges and business models?

What are the Commercial Drivers for the Global Move to HDTV Operations?

At a time when we are now several years into the HD transition, what continues to drive broadcasters to move to HDTV operations?  Are broadcasters moving to HD to for engineering reasons (e.g. delivering better image quality to viewers), or for commercial reasons (e.g. to remain competitive in the marketplace)?

A Look at How the Recession Affected Broadcast Technology Vendors

Broadcasters cut their technology budgets during the recession.  How did this impact the revenue of vendors who supply hardware and software products to these customers? To find out, we asked just under 800 broadcast technology vendors who participated in the 2010 Big Broadcast Survey how their company’s revenues had changed over the past year in terms of percentage growth or decline.

Economists Say Recession is Over – What was it Like for the Broadcast Industry?

Broadcast technology budgets were hard hit by the global downturn, which in turn impacted the supplier community.  For the past 18 months, vendor after vendor has reported that their sales are down due to the reigning-in of spending by customers.  During this time technology providers have been impacted severely. Many have reported losses and have gone through painful rounds of layoffs.  Some businesses have liquidated, and there has been a marked uptick in industry consolidation.  To find out how broadcast technology budgets were impacted by the recession, we asked a series of in-depth questions to a global sample of broadcast technology professionals as part of the 2010 Big Broadcast Survey (BBS).

Transition to HDTV to Drive European Broadcast Project Spending

Much of the technology spending in the broadcast industry is project-based, and for the past several years the transition to HDTV operations has been one of the key drivers of large scale CapEx by broadcasters and other broadcast professionals in the EMEA region.

Our research shows that the transition to HDTV will continue to be the top driver of technology spending.  But which product categories will be the beneficiaries of this spending, and just how long will the transition continue?

Value for Money Rankings of Broadcast Technology Vendors — The Top 30 Globally

An overview of how broadcast technology vendor brands were ranked for “Value for Money” in the 2010 BBS. Results are shown globally and regionally.

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Who are the Most Important Broadcast Technology Purchasing Decision Makers Today? What About the Future?

How will the transition to IT-based broadcasting affect how broadcast technology products are purchased, not to mention who buys them?  Traditionally broadcast gear has been purchased primarily by engineers.  Will this be the same for products that are increasingly IT-based, or will there be a new set of buyers?  To find out we asked the nearly 800 broadcast technology vendors who responded to the 2010 Big Broadcast Survey who they feel is currently the most important decision maker in the sales process, and who they feel will be most important in 2-3 years.

 

Changing the Mix. Broadcast Technology Vendors Look to Sell Increasingly Through Indirect Channels

Broadcast technology vendors have a variety of go-to-market options, including direct sales, a network of dealers & reps, and of course systems integrators.  There is no one-size-fits-all approach to selling successfully, so all vendors use some kind of mix of the available options.  To better understand how broadcast technology vendors are selling today and what how they are thinking about their future distribution strategies, we asked the nearly 800 broadcast technology vendors who responded to the 2010 Big Broadcast Survey about their current and future sales channels.

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Reliability Rankings of  Broadcast Technology Vendors — The Top 30 Globally

An overview of how broadcast technology vendor brands were ranked for “Reliability” in the 2010 BBS. Results are shown globally and regionally.

Strategic Planning, Biz Dev Top Broadcast Tech Vendor Improvement Wish List

As part of the 2010 Big Broadcast Survey, just under 800 broadcast technology hardware and software vendors were asked what they would most like to improve about their organizations. The results provide interesting insight into the difference in attitudes and business approach of vendors of different sizes types and businesses.

Quality Rankings for Broadcast Technology Vendors — The Top 30 Globally

An overview of how broadcast technology vendor brands were ranked for “Quality” in the 2010 BBS. Results are shown globally and regionally.

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Innovation Rankings for Broadcast Technology Vendors — The Top 30 Globally

An overview of how broadcast technology vendor brands were ranked for “Innovation” in the 2010 BBS. Results are shown globally and regionally.

The Top 30 Improving Broadcast Technology Vendor Brands, Ranked Globally + Regionally

An overview of how broadcast technology vendor brands were ranked for “net change in overall opinion” in the 2010 BBS. Results are shown globally and regionally.

The Top 30 Broadcast Technology Vendor Brands, Ranked by “Overall Opinion,” Globally and Regionally

An overview of how broadcast technology vendor brands were ranked for “overall opinion” in the 2010 BBS. Results are shown globally and regionally

What factors most influence the purchase of broadcast technology products?

Regardless of how broadcast technology products are purchased, what many in the industry want to know is why they are bought, i.e., what is the most important factors that influence the decision to buy one product over another.

When it comes to selling broadcast technology, there are several strategies that vendors have adopted. This includes positioning their offerings as having the best technology, the best feature set, the lowest cost, the best value, the best service, the most recommended, etc. But which factor is the most important to the most buyers?

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Purchasing Preferences of Broadcast Technology Buyers – “Best-of-Breed” or “One-Stop-Shop?

How do buyers of broadcast technology products prefer to purchase: using a best-of-breed approach (evaluating products from multiple vendors) or a one-stop shop where one vendor provides a complete solution?

How are broadcast technology products typically purchased — direct from vendors, through an SI or a dealer?

This article examines the way broadcast technology products are purchased, i.e., what purchasing channels are typically used by buyers of broadcast technology products.

NAB 2010: NAB: Stations Focus On Web, Mobile, HDTV (TVNewsCheck Interview)

In this interview conducted by Harry Jessell of TV News Check, Joe Zaller discusses the major trends that are impacting US broadcasters, including the transition to HDTV, multi-platform content delivery and 3D.

What Broadcast Buyers Are Evaluating for Purchase in 2010

This article focuses on the products that are being evaluated for purchase this year by broadcast professionals.  We presented technology buyers with a list of relevant product categories, and asked them to indicate which product type they are currently evaluating for purchase.

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Where is Money Being Spent in the Broadcast Industry? — A Review of Major Projects Being Planned

In the current environment, everyone in the broadcast business wants to know which parts of the industry are doing well, where money is being spent and what is driving this spending.

Broadcast Industry’s Largest Market Study Reveals Most Important Technology Trends

This article looks at how respondents ranked a variety of technology trends in terms of importance to their business. This article presents the answers to this question in two ways: as a global trends index and by the percentage of respondents who indicated the importance of each trend to their business.

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More Broadcast Vendor M&A: Rohde & Schwarz Acquires DVS

broadcast industry technology trends, Broadcast Vendor M&A | Posted by Joe Zaller
Dec 16 2010

In a deal that gives it access to new markets and new technology, broadcast test & measurement specialist Rohde & Schwarz announced that it has taken over post production server vendor DVS.

The deal extends the reach of Rohde & Schwarz into the post production market and gives it access to a wide variety of file-based image processing tools.  DVS, also headquartered in Germany is a well established provider of HD, 2K and 4K digital workflow solutions through its Clipster product family.

Jürgen Nies, Head of the Broadcasting Division at Rohde & Schwarz explained the rationale for the deal saying “We are confident that this partnership will result in the transfer of valuable technology from the studio to broadcasting.”  Nies also said that DVS will benefit from the international Rohde & Schwarz sales network.

According to the announcement, the existing structures of DVS and its subsidiaries will be retained, and DVS Digital Video Systems AG will now appear as DVS, a Rohde & Schwarz company.

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You can read the full press release here.

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What are the Commercial Drivers for the Global Move to File-Based Operations in the Broadcast Industry?

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research | Posted by Joe Zaller
Dec 13 2010

This is the second in a series of occasional articles about the commercial drivers behind some of the most important trends in the broadcast industry.  The first article in this series discussed the commercial drivers for the global move to HDTV operations.

As part of the 2010 Big Broadcast Survey (BBS), we asked a global sample of more than 5,600 broadcast professionals about the most important trends in the broadcast industry.  Respondents were presented with a series of industry trends, and asked to indicate which one was the most commercially important to their business over the next few years.

The move to file-based workflows ranked number two on this list. 

In order to understand why, we asked a series of questions to those respondents who said the transition to file-based workflows is the one trend that is most commercially important to their business. These included why the move to file-based operations is important to them, which vendors they feel are best positioned to provide solutions to their needs, and what obstacles they think might prevent them from achieving their goals.

As shown in the chart below, the top reason cited by 2010 BBS respondents for the commercial importance of moving to file-based operations is to increase speed and efficiency in the production process.

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The only notable exception to this was respondents from pay-TV operators, who see the move to file-based operations as a way to deliver more channels and services without a significant increase in cost.

Other reasons cited include:

  • Enabling multi-platform content distribution and monetization
  • Reduce headcount and therefore cost
  • To take advantage of lower cost / generic IT technology
  • To deliver more channels / services with significantly increasing cost
  • To eliminate errors

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Top Vendors for File-Based Transition

As a follow-up, respondents were asked which vendor is best suited to help them make the transition to file-based operations.  The ten vendors mentioned most often were: Sony, Avid, Apple, Panasonic, No One Vendor, Grass Valley, Harris, EVS, JVC and Omneon.

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This article is based on the findings from the 2010 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 5,600 people in 120+ countries participating, the 2010 version of the BBS is the largest and most comprehensive market study ever done in the broadcast industry.

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KIT digital Sells $110.4 Million of Stock, Says it will use Proceeds for Broadcast Industry M&A

Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Dec 10 2010

IPTV asset management solutions provider KIT digital said that it sold $110.4m of common stock in a recent public offering, netting the company approximately $102.5m after expenses.

As announced previously, the company says that it plans to use the proceeds of the offering “primarily to acquire and invest in competitive and complementary businesses as part of its growth strategy.”

Company chairman & CEO Kaleil Isaza Tuzman said that the company’s plan is to increase its market penetration from “current estimated 20-plus percent global market share to more than 50 percent within the next 24 months … through a vanguard of organic growth complemented by highly selective, accretive acquisitions.”

Tuzman   said that while the company will continue to evaluate small acquisitions that add geographical and sales vertical reach in areas where we could be relatively stronger, it is also considering “more transformative acquisition opportunities, where we might be able to acquire a top competitor and significantly extend our market share in one action.”

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You can read the full Kit digital announcement here.

Here is the full Kit digital offering prospectus, which provides useful company and market information.

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Wegener Says Preliminary Q1 Results are a Significant Improvement

broadcast industry trends, Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Dec 10 2010

Wegener today issued preliminary results for the first quarter of fiscal 2011, which ended December 3, 2010.  The company, which called the results a significant improvement, said that it lost approximately $26,000 on revenue of $3m compared to revenues of $1.9m and a net loss of $990,000 during the same period last year. Final results will be released on January 17, 2011.

The company said its 18-month backlog was approximately $6.3m at the end of the quarter, compared to $4.2 million at the end of the first quarter of the previous fiscal year.

Company president & CEO Troy Woodbury said that while he was not satisfied with the company’s performance, he is pleased with the real progress the Wegener team is making.  “Our bookings and revenue performance in the first quarter of fiscal 2011 was a strong improvement over each of the quarters of fiscal 2010 and the first quarter operating loss was less than any of the quarters in fiscal 2010,” said Woodbury.

The company also said that it has recently granted 1.16m shares in stock options and restricted stock to senior executives, all other employees, and members of its board.

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You can read the full Wegener preliminary Q1 2011 earnings press release here.

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Avid to Cut Jobs, Close Some Facilities During First Half of 2011

broadcast industry trends | Posted by Joe Zaller
Dec 10 2010

In a recent 8K filing with the Securities and Exchange Commission, Avid disclosed that it plans to restructure its operations during the first half of 2011 by eliminating positions “in lower growth geographies and markets,” while reinvesting in “more strategic areas with greater opportunity for growth.”  Avid also said that it will be closing portions of certain office facilities as part of this process. 

The company expects to incur $10m to $12m in severance costs relating to the layoffs and about $4 million relating to the closure of the office facilities. The majority of these charges will be recorded in the quarter ending December 31, 2010.

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You can read the full Avid 8K filing here.

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SeaChange Q3 Revenue Drops 8%, Says Q4 Will be Better

broadcast industry trends, broadcast technology market research, Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Dec 09 2010

Video-on-demand specialist SeaChange announced that revenue for the third quarter of 2010 was $49.9m, down 8% versus the same period a year ago, and down 3% versus the previous quarter.  The results were disappointing to equity analysts whose consensus target was $51.3m for the quarter.  

Non-GAAP net income in the quarter was $1.5m, 56% lower than the same period last year.  ON a GAAP basis, the company lost $5.2m versus a gain of $700K in last year’s third quarter.

On a segment basis:

  • Software revenue was $34.8 million, a decline of 3% versus the same period last year.  SeaChange said the drop in software sales in the quarter to lower VOD software licensing revenue from North American customers, but the decrease was  partially offset by higher sales of ad software and the recently acquired VividLogic and eventIS.

 

  • Sales from the servers & storage segment were $6.2m, down 50% compared to than during the same period a year ago.  The company attributed this decline to lower VOD server shipments to customers in North America and Latin America combined with the impact of an isolated warranty-related return of product from a customer resulting in the reduction of previously recorded revenue.

 

  •  Media services revenue was $8.1m, up 56% versus last year, thanks to new customer contracts in France and Dubai, as well as increased content processing fees from a customer in Greece.

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For the year-to-date, the company’s non-GAAP revenues were $159.2m, an increase of 7% versus the first nine months of fiscal 2010. On a GAAP basis the company’s revenues for the first nine months of the year were $155.4m, up 5% versus last year.

Year to date net income was $7.4m on a non-GAAP basis and $18.6m on a GAAP basis, versus $6.7m and 1.3m respectively.

In a statement, company chairman & CEO Bill Styslinger provided strong guidance, saying that the company’s non-GAAP revenue in Q4 would be in the $55m to $59m range.  “The strong guidance is primarily due to expectations for higher software license revenue in North America,” said Styslinger.

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You can read the full SeaChange Q3 earnings press release here.

Information about the company’s Q2 results are here.

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Ray Dolby to Retire From Board of Dolby Corporation

broadcast technology market research | Posted by Joe Zaller
Dec 08 2010

Dolby Corporation today disclosed through an 8K filing with the Securities and Exchange Commission that company founder Ray Dolby will be retiring from the company’s board of directors.

The filing says that Dolby will not stand for reelection and retire from the Board, effective as of the date of the Company’s 2011 annual meeting of stockholders. 

Upon his retirement, Dolby will be appointed to the newly-created position of “Founder and Director Emeritus.” In this position, he will be entitled to attend meetings of the company’s board and its committees as an observer and to receive copies of the related meeting materials.

The company said that Dolby is not retiring because of a disagreement with the company on any matter relating to the company’s operations, policies or practices.

To fill the board vacancy created as a result of Ray Dolby’s planned retirement, the company’s board said that it will nominate Ray Dolby’s son, David Dolby, for election as a member of the Board at the Company’s 2011 annual meeting of stockholders. 

Immediately prior to David Dolby assuming the board position, he will resign as an employee of the company, and become a consultant to the board on technology strategy matters.  The company said that David Dolby’s annual compensation as a consultant to the board will be less than the annual compensation he received as an employee of the Company in fiscal 2010.

Evertz Reports 13% Increase in Q2 Revenue Driven by Strong International Sales. Announces Purchase of File-based Workflow Specialist.

broadcast industry technology trends, broadcast industry trends, Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Dec 07 2010

Evertz Technologies reported that it earned C$20.9m during its second quarter on sales of C$82.3.  Sales were up 13% year over year, and up 12% versus the previous quarter.  According to a Reuters article, analysts were expecting revenue to come in around C$78.6m.

Without disclosing any specific names, Evertz said that its top ten customers accounted for around 35% of sales (C$28.8m) during the quarter, and that no customer accounted for more than 12% of revenue (C$9.9m).

International sales, which increased 42% versus the same period a year ago, were C$42.8m and accounted for 52% of total revenue.  This is the first time that more than 50% of the company’s revenue has come from the international market.  Meanwhile, sales in the US and Canada were down 8% versus the prior year quarter to C$40.4m.  

The company said that its backlog at the end of the November 2010 was more than C$30m, and that the geographic mix of these future sales was similar to its Q2 performance – so it appears that the its strong international performance will continue.

Gross margins were 57.9%, at the lower end of the company’s target range.  On the earnings conference call company management attributed the lower gross margins to product mix and increased pricing pressure, but said that they were not changing their gross margin targets.

For the first six months of the year the company’s sales were C$156.1m, an increase of 8% versus the first half of last year.  International sales were up 22% during the first six months of the year, while sales from the US and Canada were down 3%.  Gross margins for the first half of the year were 58%.

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Acquires file-base specialist

In its earnings press release, the company said that it had “entered into an agreement to purchase the shares of an international technology based company for under $5 million.” 

When asked about this purchase by equity analysts on the conference call, Evertz EVP Brian Campbell did not identify the acquired company by name, but said that it had revenue of around C$9m and provides file-based workflow, automation and content management tools.  Campbell said that these new capabilities would help Evertz accelerate its penetration of file-based markets, specifically those it will soon be addressing with its recently announced media server and channel-in-a-box products.  Campbell told analysts that the company’s media server is a full system, encompassing ingest, playout and enterprise storage; and that the company expects to achieve “significant traction” in the market with this product.

When asked about the possibility of future M&A, Campbell said that because of its size and reach, Evertz is often approached by smaller companies who are looking for a bigger partner.  

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You can read the full Evertz Q2 earnings release here.

Information about the company’s previous quarter results are here.

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QuStream to Voluntarily Delist from TSX

Broadcast technology vendor financials | Posted by Joe Zaller
Dec 02 2010

 

QuStream (Pesa) announced today that it will voluntarily delist its common shares from the TSX Venture Exchange at the close of business December 24, 2010.

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You can read the full QuStream press release here

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