Archive for the ‘broadcast industry trends’ Category

Ranking Broadcast Technology Vendors Part 2 – the 2011 BBS Net Change in Overall Brand Opinion League Table

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, Broadcast Vendor Brand Research, market research, Top Broadcast Vendor Brands | Posted by Joe Zaller
Aug 04 2011

This is the fifth in a series of articles about some of the findings from the 2011 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands.  More than 8,000 people in 100+ countries took part in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

 

Each year, as part of the Big  Broadcast Survey (BBS), we ask broadcast professionals worldwide to rank a variety of technology vendor brands on a wide range of metrics.  We use this information to create a series of reports, which through benchmarking and industry league tables” enable each vendors to understand its position in the market relative to their the industry as a whole as well as their direct competitors.

In a previous article we wrote about the 2011 BBS Overall Brand Opinion League Table, which shows how our global sample of broadcast professionals ranked 118 broadcast vendor brands in terms of their overall opinion of these vendors.

While it’s great for a vendor to be named to the top 30 for overall opinion, these rankings may be seen as somewhat one-sided because they rely primarily on the positive opinions of respondents. In order to get a better understanding of how broadcast technology vendor brands are perceived, it is necessary to look at both the positive and negative opinions of brands, and to take into account how these opinions have changed over time.

To achieve this, we first determine whether a respondent has an opinion of a brand, and then ask them how their opinion of that brand has changed over time – i.e. has it improved, declined or stayed the same.

When compared to the previously published ranking of overall opinions of brands, this methodology provides a more comprehensive picture of how a brand is perceived because it shows both the positive and negative opinions of each brand.

Sometimes these results highlight some interesting perceptions about brands.  Take for example the chart below, which is from our 2009 study.

 

 

 

In this case the brand that was top for “got better” was also top for “got worse.”

Given these results, it is perhaps more useful to find the Net Change in Overall Opinion for each brand, which is calculated by using the following formula:

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

In other words, the percentage of respondents who said a brand “got worse” is subtracted from the percentage of respondents who said their opinion of a brand had “got better” (ignoring the “stayed the same” number).

This takes into account both the positive and negative perceptions of brands, along with how these opinions have changed over time.  It also presents a more balanced view of which brands are getting better and which are getting worse in the minds of market participants.

Because some brands are polarizing (as seen in the example above), it’s possible that a strong “got better” response might be cancelled ut by a strong “got worse” response.  As a result some companies who were rated in the top 30 on just the “got better” score were not included in the global or regional top 30 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 30 list because these negative scores were cancelled out by even higher “got better” scores.

In order to arrive at the Net Change in Overall Opinion, research participants were asked whether their opinion of various brands had “got better”, “got worse” or “stayed the same” over the past 2-3 years.

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The results of this enquiry are shown below in two ways:

  • An overall industry “league table” that shows the 30 highest ranked vendors for the metric “Net Change of Overall Opinion.”  The data in this chart is broken out globally and regionally.

 

  • An analysis of the “frequency” of appearance in the “Net Change of Overall Opinion” league table.”

 

The top 30 ranked brands for Net Change of Overall Opinion are shown below for both the global sample of all respondents as well as for all respondents in each of the geographic regions.

 

In all cases, these results are shown in alphabetical order, NOT in the order in which they were ranked by respondents to the study.

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2011 BBS Net Chage in Overall Opinion League Table:

 

A total of 51 broadcast technology vendor brands are included in this table, illustrating the geographic variation of opinion.

In terms of frequency of appearance in this table:

 

  • 13 brands appear four times, meaning they were ranked in the top 30 globally and in each geographic region

 

  • 10 brands appear three times

 

  • 9 brands appear two times

 

  • 19 brands appear one time which demonstrates that some brands are strongest in one geographic area

 

 

Analysis of the data shows that are some clear market leaders on a global basis, while others are strong on a regional basis.

A breakdown of how many times each company appears in the ranking shows how many times each brand appears in the chart above.

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Brands appearing four times in the 2011 BBS Net Change of Overall Opinion League Table: 

  • Adobe, Aja Video, Apple, Blackmagic Design, Canon, Cisco, Genelec, Omneon, Panasonic, Riedel, Sennheiser, Sony, Tektronix

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Brands appearing three times in the 2011 BBS Net Change of Overall Opinion League Table: 

  • Ateme,  Evertz, EVS, Harmonic, Net Insight, Rhozet, Rohde & Schwarz, Ross Video, Shure, Vizrt

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Brands appearing two times in the 2011 BBS Net Change of Overall Opinion League Table: 

  • AKG, Digital Rapids, Dolby, Ensemble,  Front Porch Digital, Lawo, Telestream, TVIPS, Wohler

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Brands appearing once in the 2011 BBS Net Change of Overall Opinion League Table: 

  • AmberFin, Audio-Technica ,Avid, Fujinon, Grass Valley, Harris, Inlet Technologies, Linear, Linear Acoustic, Miranda, MSA Focus,
    Nevion, Playbox, PubliTronic, Schoeps, Screen Service, Solid State Logic, Telecast, Yamaha

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Frequency Analysis of the Brands in the in the 2011 BBS Net Change of Overall Opinion League Table:  

In order to provide a better understanding of which brands were most highly ranked in each geography, the data has been provided in the
table below, which shows the global and regional performance for each brand in the top 30 ranking of overall opinion.

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Frequency Analysis of Brands in the 2011 BBS Net Change of Overall Opinion League Table

 

 

This frequency analysis chart shows that there are some interesting geographic variations in the data. Here’s a closer look at how brands appeared by geography:

 

Appearing in the top 30 “overall opinion” ranking globally + one region

Eight brands managed to achieve a top 30 ranking in theglobal overall opinion league table, despite being in the top 30 of only one of the three geographic regions.

  • Digital Rapids, Ensemble, EVS, Front Porch Digital, Lawo, Net Insight, Telestream, T-VIPS

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Appearing in the top 30 “overall opinion” ranking in one region

The following 18 brands did not make the top 30 in the global league table of overall opinion, but they did appear in the top 30 overall opinion ranking in one of the geographic regions:

  • AmberFin, Audio-Technica, Avid, Fujinon, Grass Valley, Inlet Technologies, Linear, Linear Acoustic, Miranda, MSA Focus, Nevion, Playbox, PubliTronic, Schoeps, Screen Service, Solid State Logic, Telecast, Yamaha

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Appearing in the top 30 “overall opinion” ranking only in EMEA

  • AmberFin, Fujinon, Inlet Technologies, Linear Acoustic, Nevion, PubliTronic, Screen Service

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Appearing in the top 30 “overall opinion” ranking only in Asia-Pacific

  • Avid, Grass Valey, Harris, Miranda, MSA Focus, Playbox, Schoeps, Yamaha

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Appearing in the top 30 “overall opinion” ranking only in the Americas

  • Audio-Technica, Linear, Solid State Logic, Telecast, Wohler

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Please keep in mind when reviewing this information that all data these charts are presented in alphabetical order, not in the order brands were ranked by respondents to the 2011 BBS.  Also, the charts in this posting measure the responses of all non-vendor participants in the 2011 BBS respondents, regardless of their company type, company size, geographic location, job title and budget for broadcast technology products.  Finally please note that this study evaluated a total of 118 brands.

In order to get full value from this data, it is necessary to evaluate these results on a granular basis.  If you would like more information, please contact Devoncroft Partners.

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This article is based on the findings from the 2011 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 8,000 people in 100+ countries participating, the 2011 BBS is the largest and most comprehensive market study ever done in the broadcast industry.

Devoncroft Partners has published a variety of reports from 2011 BBS data.  For more information, please get in touch.

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Related Content:

Ranking Broadcast Technology Vendors Part 1 – the 2011 BBS Overall Brand Opinion League Table

Where is Money Being Spent in the Broadcast Industry in 2011? The 2011 BBS Broadcast Industry Global Project Index

Tracking Changes in Broadcast Industry Trends — 2011 Versus 2010

Broadcast Industry’s Most Comprehensive Market Study Reveals Top Trends of 2011

More Information About the 2011 Big Broadcast Survey from Devoncroft Partners

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© Devoncroft Partners 2009 – 2011. All Rights Reserved.

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Yet Another NAB 2011 Trend – Broadcast Vendor M&A

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, Broadcast Vendor M&A | Posted by Joe Zaller
Jul 05 2011

In the aftermath of what many vendors reported was a very successful NAB show, there appears to be an enhanced feeling of optimism in the broadcast industry, something that has been lacking for the past several years.

The global economy is seemingly healthier, the financial performance of both broadcasters and technology vendors has improved, and digital media is a hot topic across many industries as companies roll out plans to bring video and audio content to a growing number of platforms and devices.

Against this backdrop, one noticeable trend at the 2011 NAB show was increased speculation about broadcast vendor M&A and consolidation, fueled in part by investment bankers and private equity (PE) firms who were significantly more visible this year than in any NAB show in recent memory.

It is perhaps not surprising that there is an increased interest in industry M&A. Video and audio technologies have become strategic to many companies outside of the traditional broadcast business, so bankers and PE firms are looking to find companies that might add value to a larger enterprise or a portfolio of companies.

These factors have led to a flurry of recent broadcast industry M&A deals over the past year — and the pace of activity in this area appears to be accelerating. There have already been a large number of deals in 2011, including the Carlyle Group’s acquisition of The Foundry for a reported $120m, Cisco’s purchase of Inlet Technologies for $95m, Technicolor’s disposal of Grass Valley’s broadcast, transmission and head-end businesses in three separate transactions, DG Fastchannel’s acquisition of MIJO for $39.5m, and the ongoing buying spree of broadcast M&A champ Kit Digital, which has acquired more than a dozen companies, culminating in the $79.4m purchase of Ioko that was announced during the 2011 NAB show.

In addition to attracting the attention of investment bankers and PE firms, recent broadcast industry M&A activity (not to mention the healthy valuations achieved by some of the companies mentioned above), has not gone unnoticed by broadcast technology vendors. After weathering a punishing economic climate over the past two years, vendors of all sizes are now taking the time to consider their “strategic options.” Some are eager to sell their companies, while others see an opportunity to acquire other companies and consolidate their leadership position in the market.

Indeed, as shown below our most recent research of senior executives at broadcast technology vendors reveals that while about a third of companies intend to retain their private status, many others expect to be involved in some sort of strategic transaction within the next 2-3 years.

 

 

 

So what’s driving the interest in M&A activity, and what are the difference between the motivations of potential buyers and sellers?

Potential buyers are often looking for scale in the form of product lines and increased access to customers and markets. The motivations of sellers are perhaps more complex. They run the range from wanting to be part of a larger organization to the desire to cash out in a buoyant market.

Let’s examine each perspective.

 

Broadcast Industry M&A: Buyer Motivations

Expansion of a company’s product line is a key driver of M&A. Despite marketing messages to the contrary, no broadcast technology vendor truly offers a complete solution to all needs of broadcasters. Even the most comprehensive product ranges have gaps.

The question facing broadcast technology vendors is what to do about it. Broadcast technology vendors have several choices: funding internal product development, finding a complementary partner, or buying a ready-made solution through M&A. Each choice has positives and negatives associated with it.

We asked senior managers at broadcast technology vendors how they are thinking about filling in the gaps in their product portfolios. The results are shown in the chart below:

 

 

Vendors reported that internally funded product development is the most preferred approach to expanding their product ranges. Finding a complementary company to partner with is also a choice that many vendors are exploring.

Still, more than a quarter of vendors said they intend to use M&A to fill in the gaps in their product portfolios. We asked these vendors to share the motivations for wanting to acquire other companies. As shown below the top drivers for acquiring other companies comes down to a classic make or buy decision.

 

 

 

Senior executives at broadcast technology vendors listed their top two reasons for buying other companies as gaining new technical expertise and filling gaps in their product portfolio. These options apply equally to companies looking to acquire technology in their core markets, as well as those who want to buy their way into new markets.

Vendors also see M&A as a way to increase their market share. This is particularly true for vendors who have established a global sales and distribution, but have gaps in their products. This type of deal is typically a small “bolt-on” acquisition.

A less commonly cited driver is to increase economies of scale. By enlarging the scale of their operations, vendors can create savings through strategic synergies as well as through volume discounts on components and manufacturing services.

 

Broadcast Industry M&A: Seller Motivations

Senior managers of broadcast technology vendors who indicated that their company might be sold or merged over the next 2-3 years were asked for more information about why they feel this might be the case.

 

 

 

The top reasons cited by these managers for selling the company highlight both corporate and personal motivations are at play.

From a corporate point of view, managers want to access the greater resources of a larger company. This is equally valid for a small company selling to a larger company, and the merger of two small companies to create a new larger entity. These economies of scale can enable vendors to compete on a more equal footing with larger rivals.

Given that 70% of vendors who participated in our 2011 broadcast industry market study are privately held, it is not surprising that investor liquidity is also a strong motivator for selling the company to a larger entity. Whether the company is owned by the founders, a large number of shareholders, or venture capitalists, investors are always on the lookout to capitalize on their assets. And why not? Some of the vendors mentioned above were able to achieve a “strategic” valuation for their businesses, dramatically increasing the personal fortunes of company insiders.

Interestingly, just six percent of respondents cited difficulty continuing as a stand-alone entity as a reason to sell the company. This implies that if the price is not right, company owners may be happy to continue with the status-quo until a better offer comes along.

 

This article was originally published in the IABM Journal. It is based on the findings from the Devoncroft Partners’ 2011 Big Broadcast Survey (BBS), an annual study of global trends, technology purchasing behavior and the opinion of vendor brands in the broadcast industry. More than 8,000 people in 100+ countries participated in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

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Where is Money Being Spent in the Broadcast Industry in 2011? The 2011 BBS Broadcast Industry Global Project Index.

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, content delivery, market research, technology trends | Posted by Joe Zaller
Apr 07 2011

 

This is the third in a series of articles about some of the findings from the 2011 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands.  More than 8,000 people in 100+ countries took part in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

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In previous articles, I’ve written about the 2011 BBS Broadcast Industry Global Trend Index, which shows the most important trends in the broadcast industry for 2011.  As a follow-up I wrote about how the commercial importance of these trends has changed over time.

Tracking broadcast industry trends is important because it provides insight into which areas are receiving the most attention from technology buyers.  However, it’s important to note that industry trends are a reflection of what customers are thinking and talking about, not necessarily where they are spending money today.

Indeed, the 2011 BBS Broadcast Industry Global Trend Index includes a mix of current and future commercial priorities, some of which broadcasters have not yet determined how to implement. Thus, while trends are important they do not necessarily translate into where broadcast technology buyers will be spending their budgets in 2011 and 2012. 

Technology spending in the broadcast industry tends to be project-based. Projects might include international elections and sporting championships, to the long-term planned capital upgrades of broadcast infrastructure and facilities.  Thus, an understanding of the major projects being implemented by broadcaster professionals around the world provides useful insight into the capital expenditure plans of the industry.

We presented broadcast professionals with a list of major projects and asked them to indicate which ones they are currently implementing or have planned / budgeted to implement in the next year.  Their responses were then used to create the 2011 BBS Broadcast Industry Global Project Index, which is shown below. 

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One look at the 2011 BBS Broadcast Industry Global Project Index illustrates the difference between what people are thinking and talking about (trends), and where they are planning to spend their budgets (projects). Although “multi-platform content delivery” dominated the 2011 BBS Broadcast Industry Global Trend Index, the corresponding project “distribute and monetize content on multiple distribution platforms,” ranked #9 out of 15 in the 2011 BBS Broadcast Industry Global Project Index.

By a significant margin, more broadcast technology buyers said that they are budgeting for “upgrading infrastructure for HD/ 3Gbps operations” than any other project.  Upgrading infrastructure for HD / 3Gbps operations was also the dominant planned project in the 2010 BBS. 

This project correlates directly with “transition to HDTV operations,” which was ranked #2 in the 2011 BBS Broadcast Industry Global Trend Index.

The projects ranked 3rd, 5th and 6th – upgrading transmission & distribution capabilities; building new studios / OB vans; and launching new channels – are also related to the transition to HDTV operations, as these transmission upgrades, new studios, and new channels will almost certainly be at least HD capable, if not fully HD.

Many of the other top ranked projects are related to the file-based / tapeless workflow, which ranked #3 in the 2011 BBS Broadcast Industry Global Trend Index. For example, many respondents indicated that they planning workflow / asset-management; archive-related; and automation projects.

The rest of the list offers a mixed picture of project activity across the world, and includes everything from upgrading audio and newsrooms to multi-platform distribution being chosen in large numbers. 

As mentioned earlier, multi-platform content delivery ranked #9 in the 2011 BBS Broadcast Industry Global Project Index.  Despite the importance to organizations of monetizing content on multiple distribution platforms, it appears many broadcast professionals have not solidified their business plans in this area.  This likely means that there will be significant opportunities in the future for broadcast technology vendors who offer a suite of products for multi-platform content delivery.  The current excitement surrounding OTT video, connected TV, and mobile DTV is evidence of this, but these initiatives represent a relatively small proportion of the money being spent on broadcasting technology in 2011.

Interestingly, despite the fact that they may have the potential to deliver increased efficiencies and new revenue streams, there are several major projects that appear towards the bottom of this list. The two most obvious instances are the low ranking of “consolidate operations in regional hubs (centralcasting), and “outsourced operations (playout),” which are the bottom two projects on this list. This is because although these are high value projects, they will be undertaken by a relatively small number of organizations — i.e. large broadcasters.  This highlights that the 2011 BBS Broadcast Industry Global Project Index is a graphic representation of the number of all planned projects across all respondents, regardless of organization type, size, or location.  It does not measure size, value, or relative commercial importance of planned projects.  Please keep this in mind when reading this information and interpreting these findings.

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Keep in mind when reading this information that all data in this article measures the responses of all non-vendor participants in the 2011 BBS, regardless of organization type, organization size, job title or geographic location.  Responses of individual organization types or geographic locations may be very different than those shown in this high level overview.  Granular analysis of these results is available as part of the full 2011 BBS Global Market Report. For more information about this report, please contact Devoncroft Partners.

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Related Content:

You can find out about the 2011 Big Broadcast Survey here.

The 2011 BBS Broadcast Industry Global Trend Index is here.

The 2010 BBS Broadcast Industry Global Trend Index is here.

The 2009 BBS Broadcast Industry Global Trend Index is here.

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This article is based on the findings from the 2011 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 8,000 people in 100+ countries participating, the 2011 BBS is the largest and most comprehensive market study ever done in the broadcast industry.

Devoncroft Partners has published a variety of reports from 2011 BBS data.  For more information, please get in touch.

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©Devoncroft Partners 2009-2011

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More Broadcast Vendor M&A: DG Fastchannel Acquires Canadian Ad Firm MIJO, Second M&A Deal in Six Months

broadcast industry technology trends, broadcast industry trends, Broadcast technology channel strategy, Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Apr 05 2011

DG Fastchannel announced that it has acquired MIJO, a provider of broadcast and digital media services to the Canadian advertising, entertainment and broadcast industries, for $39.5m in cash.

This appears to be a good exit for 32-year old MIJO, which provides US and multinational brands with a platform of bilingual and integrated media services.  MIJO had 2010 revenue of C$17.4m ($18m USD) and EBITDA of approximately C$3m, meaning that it achieved a valuation of 2.2x revenue and 5.8x EBITDA.

DG says it expects to achieve approximately $3.5m in cost synergies during the initial 12 month period following close.

MIJO co-founders Joel Reitman and Michael Goldberg are expected to remain with the company together with the core group of 110 employees, in order to assure operating continuity for Canadian clients.

This is the second M&A deal for DG FastChannel in the last six months.  Last September, it acquired Match Point Media LLC, a provider of services to the infomercial industry, for $26 million in cash.

It is likely that DG will continue to be acquisitive.  Last month the DG announced that it had appointed a new board member with “extensive experience in M&A” to assist the company with global expansion and operational improvement.

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Related Content:

You can read the DG press release about the acquisition of MIJO here.

DG FastChannel Buys Match Point Media, Expands into Infomercial Market

DG Appoints new board member to focus on M&A

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NAB 2011 And The Investment Banker’s View of the Broadcast Technology Industry

broadcast industry technology trends, broadcast industry trends, Broadcast technology channel strategy, broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A, market research | Posted by Joe Zaller
Mar 29 2011

The 2011 NAB show is less than two weeks away and there appears to be a feeling of optimism in the industry, something that has been lacking for the past year or two.  The economy is seemingly healthier, the financial performance of both broadcasters and technology vendors has improved, and digital media is a hot topic across many industries as companies roll out plans to bring video and audio content to a growing number of platforms and devices. 

The pre-NAB period is typically when expectations are set for the year, as both customers and vendors reveal their respective buying and selling plans. So far there have been year there have been some interesting articles written about what customers are shopping for at the show, what new technologies are on display and of course the most important trends in the broadcast industry in 2011.  

But there’s another group of industry observers who also have an interesting view on the outlook for the broadcast industry – investment bankers and private equity firms – and this year there appears to be more interest than usual from these players.

So what do investment bankers think about the broadcast industry, and what are their objectives for the NAB show?  In a word: deals. 

At this year’s NAB show, bankers and PE players should have plenty to keep them busy.

Video and audio technologies have become strategic to many companies outside of the traditional broadcast business, so bankers will use the NAB show as a way to find companies that might add value to a larger enterprise or a portfolio of companies.

Within the traditional broadcast industry, the improving economy has increased speculation about broadcast vendor M&A and consolidation.

Indeed, as shown below, our most recent research of senior executives at broadcast technology vendors reveals that while about a third of companies intend to retain their private status, many others expect to be involved in some sort of strategic transaction within the next 2-3 years. 

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Recently Covington Associates and Silverwood Partners, two investment banks that focus on the broadcast and digital media industries, published pre-NAB “teaser” documents for their clients and prospects.

Covington’s pre-NAB market analysis provides a concise overview of macro drivers in the industry and highlights recent digital media M&A activity.  This is (as far as I know) the first time that Covington has published a pre-NAB industry analysis, presumably driven their recently enlarged digital media team, which marries former industry executives and investment banking expertise.

Silverwood has been consistency active in the broadcast industry for the past decade, and typically publishes a report before and after major industry trade shows. You can read their pre-NAB 2010 document here, their pre-IBC2010 document here, and their IBC 2010 Post-Show Perspectives here. 

Silverwood’s 39-page pre-NAB 2011 document takes an in-depth approach.  It covers trends in the digital media industry, recent financial performance by vendors, macro industry drivers, the accelerated pace of change in the broadcast technology space, the “3D hype cycle,” and the way customers are changing their commercial focus and broadcast technology procurement plans as their revenue models shift towards “new media.”

Silverwood ends their deck with an interesting section on broadcast industry IPO, PE and M&A transactions, and why company valuations may differ, based on a number of factors. In doing they are seeking to balance creating excitement about M&A, and setting realistic expectations about valuations.

Overall both are worth reading, regardless of whether you are a vendor, broadcaster, or independent industry observer.  They provide a perspective that is sometimes missing when people discuss the broadcast business. 

At the end of the day the broadcast industry is a business; so when you head off to the NAB show, make sure you understand what both technology and financial people are thinking.

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Related Content:

Covington Associates: 2011 NAB Show Overview

Silverwood Partners: 2011 NAB Show Strategic Industry Analysis

Broadcasting & Cable Article: Gearing up for NAB 2011

Broadcast Industry’s Most Comprehensive Market Study Reveals Top Trends of 2011

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Tracking Changes in Broadcast Industry Trends — 2011 Versus 2010

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research, technology trends | Posted by Joe Zaller
Mar 21 2011

This is the second in a series of articles about some of the findings from the 2011 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands.  More than 8,000 people in 100+ countries took part in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

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In a recent post I discussed the 2011 BBS Broadcast Industry Global Trend Index, which shows the most important trends in the broadcast industry for 2011.

The article referenced both the 2009 and 2010 BBS Broadcast Industry Global Trend Index from, and looked at how the rankings of trends have changed over time.  For example, in 2009 the transition to HDTV operations was, by far, the top ranked trend.  However by 2011, the transition to HDTV operations had been overtaken by multi-platform content delivery as the top trend (although the move to HD is clearly still very important).

This post generated a lot of lot of feedback from clients and readers.  Many people said they wanted to more easily see changes to the importance of trends over time, and asked for a single chart that shows year-over-year comparisons.  I’ve done this in the chart below, which shows a comparison of the BBS Broadcast Industry Global Trend Index from 2011 and 2010. 

Please note that I have not included the 2009 Index in this chart because multiple changes were made to the trends in the Index between 2009 and 2010, reducing the ability to make an “apples-to-apples” comparison.  It’s also worth noting that all 14 trends from the 2010 Index were included in the 2011 Index.  However, based industry feedback, we added a 15th trend to the 2011 list – i.e. analog switch-off, which was ranked 11th out 15 in 2011.  The addition of analog switch-off likely “cannibalized” a small percentage of responses from other trends in this year’s ranking. 

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So what changed between 2010 and 2011? 

There are two ways to look at this:

  • changes in overall numerical ranking relative to the previous year
  • changes in overall commercial importance relative to the previous year

 

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Changes in Numerical Ranking of Broadcast Industry Trends

Let’s start with the overall numerical ranking of trends.  The first column in the table below shows how trends were ranked in 2011. The number in parentheses to the right of each trend shows how it ranked in the 2010 BBS Index. Although there were no changes at the top and bottom of the 2011 Index versus the 2010 Index, almost everything in between changed position relative to the previous year.

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As I wrote previously, the top four trends in the 2011 Global Broadcast Industry Trend Index are the same as last year and the year before:

  • Multi-platform content delivery
  • Transition to HDTV operations
  • File-based / tapeless workflows
  • IP networking and content delivery

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However, there has been considerable movement in the relative ranking of these four trends over the past several years.  Most significantly, “multi-platform content delivery” has become increasingly important, and is the dominant trend in 2011.   

Several trends were ranked more highly in 2011 than in 2010.  For example video-on-demand moved up from #8 in 2011 from #6 in 2011; while 3DTV moved up from #10 in 2010 to #8 in 2011.

Other trends remained relatively static in terms of their ranking in 2011.  For example: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations” and “green initiatives” remained the bottom four trends in 2011, as they were in 2010.

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Changes in Commercial Importance of Broadcast Industry Trends

As well as changes to numerical ranking, there were also year-over-year changes to the perception of commercial importance to each trend.  This is shown in the table below:

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For the most part, the trends moved up in the rankings in 2011 also were seen as more important commercially versus the previous year. 

However, it is possible for a trend to move up in the numerical ranking, while moving down in terms commercial importance to respondents, as happened this year with the transition to HDTV operations.  In this case, these changes are likely more of a function of the strong showing for multi-platform content delivery, than a poor showing for the transition to HDTV.

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Why Tracking Movement of Trends is Important

In the broadcast industry much of the spending on technology is project-based, and those projects all come from somewhere.  Our view is that industry trends drive capital projects, which in turn drive budgets, which in turn drive product purchase.  In other words, what’s commercially important to technology buyers today (i.e. trends) will likely turn into what they are budgeting for tomorrow (i.e. projects).

Looking at the trend data from the 2011 BBS, monetizing content on multiple platforms is clearly a key objective for broadcast professionals this year.  Yet, as I wrote a few months ago after returning from CES: “On the monetization point, I lost count of the number of times I heard the word “experimentation” during [conference] sessions – particularly from content owners.  In other words, although everyone agrees that multi-platform content delivery is a very important trend, many players have still not figured out the business model.”

There’s a difference between recognizing that a trend is commercially important and having a business plan in place that capitalizes on it.  So while there’s no doubt that generating incremental revenue by delivering a multi-screen experience to consumers is hot topic, business models have to move beyond the experimental in order to drive serious market growth.  Once that happens, multi-platform content delivery will likely become the most important planned project rather than just the most important trend.

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Keep in mind when reading this information that all data in this article measures the responses of all non-vendor participants in the 2011 BBS, regardless of organization type, organization size, job title or geographic location.  Responses of individual organization types or geographic locations may be very different than those shown in this high level overview.  Granular analysis of these results is available as part of the full 2011 BBS Global Market Report. For more information about this report, please contact Devoncroft Partners.

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Related Content:

You can find out about the 2011 Big Broadcast Survey here.

The 2011 BBS Broadcast Industry Global Trend Index is here.

The 2010 BBS Broadcast Industry Global Trend Index is here.

The 2009 BBS Broadcast Industry Global Trend Index is here.

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This article is based on the findings from the 2011 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 8,000 people in 100+ countries participating, the 2011 BBS is the largest and most comprehensive market study ever done in the broadcast industry.

Devoncroft Partners has published a variety of reports from 2011 BBS data.  For more information, please get in touch.

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©Devoncroft Partners 2009-2011

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Broadcast Industry’s Most Comprehensive Market Study Reveals Top Trends of 2011

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, market research, technology trends | Posted by Joe Zaller
Mar 16 2011

This is the first in a series of articles about some of the findings from the 2011 Big Broadcast Survey (BBS), a global study of broadcast industry trends, technology purchasing plans, and benchmarking of broadcast technology vendor brands.  More than 8,000 people in 100+ countries took part in the 2011 BBS, making it the largest and most comprehensive market study ever done in the broadcast industry.

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The 2011 BBS Broadcast Industry Global Trend Index

Each year, Devoncroft Partners conducts a large scale global study of the broadcast industry called the Big Broadcast Survey (BBS).  More than 8,000 broadcast professionals in 100+ countries participated in the 2011 BBS, making it the most comprehensive study ever done in the broadcast industry.

One of the key outputs from the BBS is the annual BBS Broadcast Industry Global Trend Index. This is a ranking of the broadcast industry trends that are considered by BBS respondents to be the most commercially important to their businesses in any given year.

To create the 2011 BBS Broadcast Industry Global Trend Index, we presented BBS respondents with a list of 15 industry trends and asked them to tell us which one trend they consider to be “most important” to their business, which one trend they consider to be “second most important” to their business, and which other trends (plural) they consider to be “also very important.” 

We then used the responses to this question to create the BBS Broadcast Industry Global Trend Index by applying a weighting based on the commercial importance of each trend. 

Please note that our goal from this question is to help clients gain insight into the business drivers behind the respondent’s answer.  Therefore, we asked this question in the context of commercial importance, rather than “industry buzz” or technology hype.

The table below shows the 2011 BBS Broadcast Industry Global Trend Index.  Please note that this chart measures the responses all non-vendors who participated in the 2011 BBS, regardless of company type, company size, geographic location, job title etc. 

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Similar to results in both the 2009 and 2010, the top four trends in the 2011 Global Broadcast Industry Trend Index are:

  • Multi-platform content delivery
  • Transition to HDTV operations
  • File-based / tapeless workflows
  • IP networking and content delivery

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However, there has been considerable movement in the relative ranking of these four trends over the past several years.  Most significantly, “multi-platform content delivery” has become increasingly important, and is the dominant trend in 2011.   For comparison:

  • In 2009, the BBS Broadcast Industry Global Trend Index was dominated by the transition to HDTV operations, while multi-platform content delivery was fourth on the list

 

  • In 2010, multi-platform content delivery had become the most important industry trend, narrowly eclipsing file-based / tapeless workflows (which were combined in the 2010 BBS Trend Index) and the transition to HDTV operations

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These results show that broadcast professionals continue to focus their efforts on taking advantage of the potential for incremental revenue streams presented by multi-platform content delivery.  Indeed, as the chart above shows multi-platform content delivery was ranked significantly higher than any other trend in our 2011 study.  As video content become ubiquitous, broadcasters and content owners are looking for ways to monetize their assets, and grow their revenue.  Technology vendors are continuing to develop solutions to convert content for optimal performance on any platform, and to run targeted ads alongside that content.

But there is more to the story than just multi-platform content delivery. For the third year in a row, the transition to HDTV operations ranks as one of the top trends in the broadcast industry.  It’s likely that HDTV upgrades will continue to be one of the major drivers of project-based spending as broadcasters around the world continue with plans to transition their operations to HDTV.  We provide significant coverage of the global move to HDTV in the 2011 BBS Global Market Report.  This includes a breakdown of where broadcasters are in their transition to HD, and a look at the upgrade plans for more than a dozen product categories. We’ll also be publishing more information here about project-based spending and the HD transition in future articles.

Operational efficiencies (through file-based / tapeless workflows) remain a significant macro driver in 2011, as broadcasters continue to deploy new workflows.  The increasing importance of file-based technologies has implications for the broadcast industry in terms of both workflows and product procurement.  Our previous research shows that broadcasters are moving to file-based workflows not only to achieve greater speed and efficiencies, but also to reduce cost.  During the recession, technology budgets were typically prioritized towards solutions that add revenue and/or reduce cost.  Now that the industry is recovering from the downturn, it’s likely that the way technology is purchased will remain focused on these commercial priorities.

Several trends were ranked more highly in 2011 than in 2010.  For example video-on-demand moved up from #8 in 2011 to#6 in 2011; while 3DTV moved up from #10 in 2010 to #8 in 2011.

Other trends remained relatively static in terms of their ranking in 2011.  For example: “transition to 3Gbps operations”, “transition to 5.1 channel audio”, “outsourced operations” and “green initiatives” remained the bottom four trends in 2011, as they were in 2010.

It’s worth mentioning that in order to show year-over-year movement, all trends from the 2010 BBS were included in the 2011 BBS.  However, based on industry feedback, we added a 15th trend to the 2011 list – i.e. analog switch-off, which was ranked 11th out of 15 in 2011.  The addition of analog switch-off likely “cannibalized” a small percentage of responses from other trends in this year’s ranking. 

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Keep in mind when reading this information that all data in this article measures the responses of all non-vendor participants in the 2011 BBS, regardless of organization type, organization size, job title or geographic location.  Responses of individual organization types or geographic locations may be very different.  Granular analysis of these results is available as part of the full 2011 BBS Global Market Report. For more information about this report, please contact Devoncroft Partners.

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Related Content:

You can find information about the 2011 Big Broadcast Survey here.

The 2010 BBS Broadcast Industry Global Trend Index is here.

The 2009 BBS Broadcast Industry Global Trend Index is here.

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This article is based on the findings from the 2011 Big Broadcast Survey (BBS), a global study of industry trends, technology purchasing behavior and the opinion of vendor brands.  With more than 8,000 people in 100+ countries participating, the 2011 BBS is the largest and most comprehensive market study ever done in the broadcast industry.

Devoncroft Partners has published a variety of reports from 2011 BBS data.  For more information, please get in touch.

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The 2011 Big Broadcast Survey – Now Available

broadcast industry technology trends, broadcast industry trends, Broadcast technology channel strategy, broadcast technology market research, Broadcast Vendor Brand Research, Top Broadcast Vendor Brands | Posted by Joe Zaller
Mar 10 2011

After many months of work, I am pleased to announce that the 2011 Big Broadcast Survey (BBS) has been completed, and that reports from the study will be published soon.

If you’re not familiar with the BBS, it’s an annual demand-side study of the global broadcast industry. BBS reports help readers improve their strategic decision making, customer engagement, marketing strategy, product planning, and sales execution.

More than 8,000 broadcast professionals in 100+ countries participated in the 2011 BBS, making it by far the largest and most comprehensive market study of the broadcast industry.

Three types of reports are available:

  • The BBS Global Market Report is the broadcast industry’s first global demand-based study of the purchasing habits of technology buyers.  This report examines industry trends, major projects being planned, products being evaluated for purchase, current and future plant infrastructure and operational structure, broadcast technology budgets, and HD upgrade plans for a wide variety of products.

 

  • BBS Global Brand Reports are available for more than 100 broadcast technology vendors.  These reports provide deep insight into how each company is perceived by the market, along with comprehensive benchmarking of broadcast technology vendors on a wide variety of metrics, through a series of league table rankings

 

  • Twenty-six separate 2011 BBS Product Reports provide detailed vendor brand ranking for individual product categories. These reports enable users to benchmark their brand directly against specific competitors through a detailed understanding of the opinions of technology buyers who purchase, specify or use each product type.  

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If you would like information about these reports and how they can help your business, please get in touch.

In addition to these paid-for reports, we will also be publishing highlights from the study on the Devoncroft website.  These articles will be posted on a semi-regular basis, so please check back often.   

You’ll also be seeing information from the 2011 BBS in a wide variety of other industry websites and trade magazines.

The tables below show the product categories and broadcast technology vendor brands covered in the 2011 BBS.

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 Product Categories Covered in the 2011 BBS:

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Broadcast Technology Brands Covered in the 2011 BBS:

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Miranda Reports Record Q4 and Full Year 2010 Results, Forecasts Continued Growth

broadcast industry trends, Broadcast technology vendor financials, Broadcast Vendor M&A, Quarterly Results | Posted by Joe Zaller
Feb 24 2011

Miranda Technologies said today it achieved record revenue for the fourth quarter and full year 2010, driven by a strong international sales performance, and helped by the contribution from recently acquired automated playout provider OmniBus Systems.

Revenue for the fourth quarter was a record C$44.9, up 26% versus the same period a year ago, and up 19% versus the previous quarter. OmniBus, which was acquired in September of 2010, contributed C$6m during the quarter.   Excluding OmniBus, Q4 revenue grew 9% versus the same period a year ago.

Q4 net income was C$3.8m, up 82% from Q4 2009 but down 42% from the previous quarter when the company was helped by a C$1.3m reduction in income taxes as well as a one-time tax credit of C$2.4m.  OmniBus recorded a net loss of $0.2m during the quarter. Excluding OmniBus, Q4 net income was up 92%.

Gross margins for the quarter were 60%, up seven percentage points versus the same quarter a year ago, and exceeding the high-end of the guidance the company issue during a recent investor presentation. The company attributed its strong margin performance to improved pricing, product and customer mix, including the sale of higher margin solutions associated with OmniBus, along with operational efficiencies.  Miranda says it expects gross margins to continue to be at the high-end of its targeted range of 55% – 59%.

EBITDA was C$8.1m for the quarter, up 57% over Q4 2009. EBITDA as a percentage of sales was 18%, up three percent versus the same period a year ago.

Q4 Revenues increased in all geographies versus the previous year, with Canada, the United States and Other Countries, growing 596%, 24% and 14%, respectively. Canada, the United States and Other Countries generated 7%, 38% and 55% of quarterly sales respectively.

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For the full year 2010, the company posted net income of C$12.2m (up 122% versus FY 2009), on record revenue of C$143.7m (up 9% versus FY 2009), with OmniBus contributing C$7.9m since it was acquired.

Excluding OmniBus, 2010 was C$135.7m, up 3% over 2009, while net income was up 122%.

On a geographic basis, full year 2010 sales from the international region increased 15% over 2009 to C$78.3m, while sales to the United States were down 3%, coming in at C$55.5m.

On the company’s conference call with equity analysts, Miranda president and CEO Strath Goodship said that the broadcast market improved during 2010 and that the company was able to capitalize on this.  He said that US broadcast market is experiencing steady recovery and that Q4 2010 was “reasonably good” in the US, but not back to 2008 levels.  However, he said that emerging markets had returned to 2008 levels, and that he expects 2011 to be a “pretty good” year.

Goodship mentioned several key product areas as revenue drivers, including the launch of the Nvision hybrid router, which has said was a big success in the market.  He also reported that infrastructure sales continued to be strong as customers worldwide continue to upgrade to HDTV operations.

Not surprisingly, Goodship spent time during the call discussing the acquisition of OmniBus, stating that the purchase of the automated playout provider was one of the company’s “most pivotal moves to date” and that it has increased Miranda’s addressable market by 40%.  Goodship says that the OmniBus integration program is progressing rapidly.  Subsequently company CFO Mario Settino said that the company has not yet fully realized the synergies of the mergers but that plans are in place to do this later in the year.

When asked by an analyst about growth at OmniBus, Goodship said that while the unit’s overall revenue growth was relatively flat, the iTX product line had experienced “dramatic growth.” 

Commenting on the potential for continued revenue growth at Miranda, Goodship said that the company believes it can continue to grow faster than the market.

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You can read the full Miranda Q4 and FY 2010 press release here.

Information on Miranda’s previous quarter performance is here.

A recent press release about Miranda’s progress with the OmniBus integration is here.

Miranda buys OmniBus story is here.

Miranda’s Most Recent Investor Presentation is here.

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Harris Says Broadcast Communications Business Improved Significantly in Q2

broadcast industry technology trends, broadcast industry trends, Broadcast technology vendor financials, Quarterly Results | Posted by Joe Zaller
Jan 26 2011

Harris Corporation today reported results for the second quarter of its fiscal year.  Overall, the company posted revenue of $1.44Bn.  This represents an organic revenue increase of 9% versus the previous year, and an increase of 18% when contributions from acquired companies are taken into consideration.

For the first time in many quarters, the company reported a strong improvement in its broadcast communications business. 

Revenue from the company’s broadcast communications division in Q2 was $130m an increase of 11% from the previous quarter, and an increase of 7% versus the same period a year ago. Orders in the quarter came in at $134m, down $139m in the previous quarter and $135m during the same period last year.

On an operating basis, the performance of the broadcast communications division does seem to be improving.  Although the company’s broadcast business posted an operating loss of $1m during the quarter, this result is significantly better than its operating loss of $9m during the previous quarter and an operating loss of $5m during the same period a year ago.

The company continues to restructure its operations, and took a $1m charge for these actions during the quarter.

For the first six months of the fiscal year revenue from the broadcast communications division was $251.6m, an increase of 7% versus the first half of last year.  The operating loss for the first half of the year was $9.4m, the vast majority of which was declared in the previous quarter.

During the company’s conference call with equity analysts, Harris president and CEO Howard Lance had positive things to say about the broadcast business. “Our broadcast business has improved and has the opportunity to contribute to earnings growth,” he said.  Lance also said that the broadcast business continued to show a number of encouraging signs including year-over-year revenue growth, a book-to-bill ratio of greater than 1:1 for the second consecutive quarter, and near break-even operating results.

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Guidance for the Harris Broadcast Business:

Lance provided forward looking guidance for the broadcast business saying that the company expects the division to break-even on full year revenue in region of $520m – $540m.  This guidance represents a 7-11% revenue increase versus the actual results during the previous fiscal year. 

It’s interesting to note that this guidance is higher than announced last quarter when Lance said that he expected full year revenue for the broadcast business to be in the region of $490m – $510m, with break-even performance. 

Last quarter Lance also said that the company expects losses in the broadcast segment will continue during the first half of the fiscal year, but that improving profitability will follow during the second half of the fiscal year. 

Given the results released today, this certainly seems to be the case.

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You can read the full Harris Q2 earnings press release here.

A transcript of the Harris Q2 conference call is here.

You can read information about the company’s previous quarterly results here.

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