Ascent Media Joins Azcar in Shutting Down Broadcast Systems Integration Business

Posted by Joe Zaller
Mar 25 2011

Yesterday broadcast systems integrator Azcar announced that it was shutting down its operations

It turns out that Azcar is not the only broadcast SI shutting its doors.  On the same day that Azcar announced its liquidation, it was revealed that Ascent Media is also closing shutting down its broadcast systems integration business.

This week Ascent Media senior buyer Marlene Lefort sent a letter to Ascent’s partners and suppliers saying that Ascent is closing its systems integration business on or about May 1, 2011.

Here’s the text of the letter:

.

 “This letter is to inform you that Ascent Media Systems Integration will be shutting down for business on or about May 1, 2011. We thank you for your support these past years and wish you continued success. If you have any questions or concerns, please feel free to contact me.”

.

Ascent’s SI business has struggled in recent years as a result of the recession, which forced many of its customers to delay or cancel projects.

Ascent’s recent 10-K filing with the SEC shows the impact of the recession on the company’s SI business.  On page 32 of the filing, it says:

.

Revenue.  In 2010, Content Services revenue decreased by $27,185,000 or 17.6% due to a decrease of $27,474,000 in system integration services as customers reduced their spending on system integration projects, with one customer, Motorola, accounting for $17.0 million of the decease and (ii) a decrease of $1,165,000 due to lower revenues for content distribution and transport services in the United States and Singapore. In 2009, Content Services revenue decreased by $105,754,000 or 40.6% due to (i) a decrease of $95,511,000 in system integration services revenue due to a significant number of large projects in the United States and the United Kingdom in the prior year with one customer, Motorola, accounting for $47.8 million of the decrease, and a decline in system integration projects in 2009 as customers reduced their spending in response to a weaker economic climate, (ii) $7,282,000 due to lower content origination and transport services in the United States and the United Kingdom and (iii) unfavorable changes in foreign currency exchange rates of $3,826,000.”

.

Although it’s quite a coincidence that both Azcar and Ascent announced that are shutting their SI operations in the same week, Ascent had previously telegraphed its intention to close the SI business via filings with securities regulators.

In its 10-K filing, Ascent stated its intention to dispose of the systems integration business, saying:  “We are currently exploring opportunities to dispose of the Systems Integration business, which we consider non-core. There can be no assurances that the disposition of the SI business will be completed in the near term and/or on terms favorable to Ascent Media, or on any terms.”

Ascent is in the process of transforming its business.  It recently acquired Montronics, a company that provides security alarm monitoring services: monitoring signals from burglaries, fires and other events, as well as, providing customer service and technical support. Ascent says Montronics has stable and scalable revenues.

To fund the Montronics acquisition, the company shed its broadcast-related interests, and exited the broadcast business altogether.  As part of this process, Ascent has disposed of assets including its:

  • Chiswick Park playout facility in London, which was sold to Discovery Communications for $34.4m
  • Global Media Exchange business, which was classified as discontinued operations in September 2010
  • Creative Services business, which was sold to Deluxe Entertainment for $69m
  • Content Distribution business, which was sold to Encompass Digital Media for $104m

 .

Unfortunately, it appears that Ascent has been unable to sell its SI business and has been forced to close its doors.

 

.

.

 Related Content:

Ascent Media 2010 annual 10-K filing with SEC

Devoncroft blog post” http://bit.ly/hn6pUn

TVB article: Azcar Folds

Broadcast Engineering Article: Systems integrator AZCAR ceases business

Press Release: Ascent Buys Montronic

Ascent Sells Post Business to Deluxe

.

.

Comments are closed.

%d bloggers like this: