When I met with Ross Video’s CEO David Ross and EVP Jeff Moore at the IBC show, they hinted that the company was in the process of finalizing an acquisition that might leave some people scratching their heads until they realized the strategic implications of the deal.
As promised, todays’ announcement that the company has acquired Mobile Content Providers (MCP), a mobile production company based in South Florida, is sure to raise some eyebrows.
The MCP deal is certainly an unusual move for Ross Video. Not because they bought a company (MCP is the seventh company acquired by Ross Video in the past four years), but for the following two reasons:
- Rather than buying a technology vendor (or design team) as they have in the past, this time Ross Video bought a customer
- David Ross told me that he intends to turn MCP into a national mobile production company, which means potentially competing with other Ross Video customers
So what’s Ross Video thinking?
It seems to me that this deal is about more than Ross buying a production company. If Ross is right, the MCP acquisition could give them access to new markets while disrupting the established model.
As the Ross Video product portfolio has grown to encompass many elements of the live production chain (switchers, routers, signal processing, graphics, servers etc), the company has notched up sales success in most market segments, with one glaring exception – sports trucks.
The North America sports production market is dominated by freelancers. Because of this, live production service providers have standardized on certain types of operator-centric equipment such as production switchers, audio mixing consoles, graphics, replay servers, and editing systems.
David Ross thinks this is an inefficient model that locks out new entrants. Ross believes that his company’s switchers, servers, and graphics systems have strong advantages against the entrenched incumbents, but the current market structure makes it virtually impossible to break in.
Ross Video is not the only company in this situation. Other vendors including Orad, For-A, Snell, and Vizrt are in a similar position. Likewise Evertz, with its Dreamcatcher system, is attempting to break into the sports replay market which is currently dominated by EVS.
“It’s a chicken and egg situation,” Ross told me. “Even if we convince the truck companies we have products that can do a better job and save them money, they will be hesitant to buy because having products that are not “freelancer approved” could make it difficult to rent their trucks.”
Ross’s desire to break into the sports market is understandable. But how does buying a small regional mobile production company help the Ross achieve this? And how will buying MCP not put Ross into competition with dozens (or more) current and potential customers?
According to Ross, if one looks at what the company has achieved with its “openGear” platform the answer starts to become clear (openGear is a Ross Video-led consortium of terminal gear vendors who produce cards that work in a common frame under a common control architecture).
“We’ve just signed up our 63rd openGear partner. Why would these companies do this, why would they work with a competitor?” Ross asks rhetorically. “The answer is an uplift of scale and market access that they would not be able to achieve otherwise. We think the truck business is going to be similar.”
David Ross has a plan he calls “openTruck,”which he thinks will help him to break into the sports market. In a nutshell, Ross Video will design production vehicles based around its technology, and make the specifications and schematics freely available to whoever wants to be an openTruck partner. This includes not only system design, but also graphic treatments, social media apps, interactive dashboards
According to Ross, the openTruck concept will benefit the mobile production companies that join the consortium, as well as the sports broadcasters who contract for these services.
The sports production market is very capital-intensive, and as sports broadcasters expand their coverage beyond professional and Division One college games, cost becomes a huge issue. Broadcasters can’t afford to send a double-expanding OB truck to a Division Three college game, yet they still have high expectations for quality production values, sophisticated graphics packages, and a consistent on-air look.
Ross thinks the best way to achieve this is to create a live production ecosystem where lower cost high performance tools are widely available, along with a ready supply of well-trained top-class freelancers.
To do this, the company intends to cooperate with a broad range of market participants, including companies who might see Ross MCP as a competitor.
According to the company, “Ross MCP will be a ‘friendly competitor’ alongside existing mobile operators and packagers, and will fund freelance training initiatives to allow this next generation of Ross workflow tools to become widely available. As well, many of the integrated solutions that Ross Video refines for Ross MCP will be available with special package pricing and support arrangements for fellow mobile operators.”
This means that in addition to helping MCP competitors plan out their live production systems and workflows (using Ross Video technology of course), the company will also create a program where freelance operators of switchers, graphics and other tool are trained on Ross technology. It’s likely that the company will also approach sports broadcasters in order to define a look and feel that can be achieved consistently across all openTruck participants.
Ross sees this is as a “win-win” for all involved (including of course Ross Video).
This is a bold move by Ross Video, and it remains to be seen whether the company can pull it off.
Yet if they can, there is likely to be plenty of demand for a ready-made fleet of trained production crews that know how to bring high production values to what has previously been considered to be “lower end” events.
To make this work, Ross Video will have to overcome a number of technical and commercial hurdles, including getting freelancers on board and trained on Ross technology (a huge task in and of itself), the reaction of MCP’s current and potential competitors, and the potential buy-in of sports broadcasters.
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