Archive for the ‘Broadcast technology vendor financials’ Category

3rd Annual “Shifting Media Economics: Impact on Strategy, Finance, and Technology” Draws Huge Crowd at NAB 2014

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Apr 09 2014

This was the scene as we kicked off the third annual “Shifting Media Economics: Impact on Strategy, Finance, and Technology”  event at the NAB 2014 Show.

This half-day session was co-produced by Devoncroft Partners, Silverwood Partners, and the organizers of the 2014 NAB Show (to whom both Devoncroft and Silverwood are very grateful).

We had a standing-room only crowd from the moment the doors opened, and attendees were not disappointed by the outstanding information presented on the day.  The power of this unique event is that it brings together three ordinarily disparate groups — technology vendors, broadcasters, and financial firms — to discuss and debate important business issues facing the industry at a time of incredibly dynamic change.

 

SRO Crowd at NAB

 

We would especially like to thank our speakers and panelists for not only taking times out of their busy lives to prepare for and attend this event, but also (especially) for their thoughtful and often candid assessment of the state of the broadcast industry today, and what the future may bring.

In particular we would like to thank Vince Roberts,EVP Global Operations and Chief Technical Officer of Disney/ABC Television for his outstanding keynote address, which which provided a truly thought-provoking insight into the future of the media industry (and he’s funny too).

 

In case you missed this event, the full agenda  included:

 

Strategic Industry Analysis: Valuations, M&A, and Equity Financing

Presenters:

  • Jonathan Hodson-Walker: Managing Partner, Silverwood Partners
  • Joshua Stinehour: Managing Director, Silverwood Partners

 

 

The Broadcast & Media Technology Industry in 2014

Presenter:

  • Joe Zaller: President, Devoncroft Partners

 

 

Business Strategy Perspective From Industry Executives

Moderator:

  • Joe Zaller – President, Devoncroft Partners

 

Panelists:

  • Sam Blackman: CEO and Co-founder, Elemental Technologies
  • Louis Hernandez. Jr.: President and Chief Executive Officer, Avid
  • Joop Janssen: CEO, EVS
  • Michelle Munson: President, CEO and co-founder, Aspera, an IBM company

 

 

Keynote: Vince Roberts: CTO and EVP Global Operations, Disney/ABC Television Group

 

 

IABM Research Overview

Presenter:

  • Peter White: Chief Executive Officer, IABM

 

 

The Broadcast Buyer Perspective on Business Models, Trends, and Technology Advancement

 

Moderator:

Joe Zaller – President, Devoncroft Partners

 

Panelists:

  • Phil Braden: SVP Technology and Applications, PCCW Global
  • Del Parks: SVP Operations & Engineering, Sinclair Broadcast Group
  • Todd Daly: EVP Operations & Systems Engineering, Fox Broadcasting
  • Andy Tennant: Technology Director, Studios, ITV

 

 

Keynote: Vince Roberts: CTO and EVP Global Operations, Disney/ABC Television Group

 

Investor Perspectives on Industry

Moderator:

Jonathan Hodson-Walker: Managing Partner, Silverwood Partners

 

Panelists

  • Jeff Parks, Founding Partner, Riverwood Partners
  • Rohan Rai: Director, Wasserstein & Company
  • Sunit Mukherjee: Principal, Symphony Technology Group

 

 For those of many of you who asked for copies of presentations, please email info [at] devoncroft [dot] com and we will try to respond as soon as possible after the 2014 NAB Show.

 

Finally, thanks to all those who attended the event and sat in such a crowded room.

 

Based on the feedback we’ve received so far, there are two key takeaways from this event:

  • The content and substance of the event was terrific
  • You might want to consider a larger room next time

 

 

Were you there?  What did you think?  Please let us know.

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Want to Understand the Top Issues at NAB 2014? Don’t Miss “Shifting Media Economics: Impact on Strategy, Finance, and Technology”

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A, market research | Posted by Joe Zaller
Apr 05 2014

NAB 2014 Strategy-Session-Logos

 

If you are interested how the dramatic changes impacting the broadcast industry may shape its future, you won’t want to miss the third annual NAB Show event co-produced by Devoncroft, Silverwood Partners and the organizers of the NAB Show.

Now part of the NAB 2014 Broadcast Management Conference, this half-day session is called “Shifting Media Economics: Impact on Strategy, Finance, and Technology.”

It will be held in room N235 of the Las Vegas Convention Center on Sunday April 6th from 1:30 p.m. to 6:00 p.m.

Download the full agenda and speaker biographies here.

As always, this event features an intensive, information-packed series of presentations and panels that discuss the strategic trends and industry-specific factors influencing the value of media technology companies.

We’ve worked hard to put together an outstanding line-up of speakers and presenters, including top technology buyers, leading technology vendor CEOs, and private equity investors who will speak to the opportunities and challenges involved with financing the next phase of technology change in the industry.

The agenda offers attendees the informed opinions of technology purchasers, industry executives, market research organizations, and financial professionals. The event will serve as a thought-provoking kick-off to the 2014 NAB Show.

Highlights will include panel discussions featuring leading vendor CEOs, senior executives from leading broadcasters, and private equity investors who will speak to the opportunities and challenges involved with financing the next phase of technology change in the industry.

In addition, the audience will benefit from preliminary excerpts from the Devoncroft Big Broadcast Survey, the industry’s definitive demand-side market report, and the IABM DC Global Market Valuation Report, the industry’s definitive supply-side market report.

This session is intended for senior executives from technology vendors, end-users, and investment firms in the media technology sector.

Please click here for more information and/or to register.

 

 

Here’s the current agenda:

Shifting Media Economics: Impact on Strategy, Finance, and Technology

Sunday April 6, 2014

1:30 p.m. – 6:00 p.m.

Room N235 Las Vegas Convention Center

Part of the 2014 NAB Broadcast Management Conference

 

 

1:45 pm – 1:50 pm

WELCOME AND INTRODUCTION

Joe Zaller – President, Devoncroft Partners

 

 

1:50 pm – 2:15 pm

Strategic Industry Analysis: Valuations, M&A, and Equity Financing

Jonathan Hodson-Walker and Joshua Stinehour of Silverwood Partners will present an analysis of strategic industry trends and the specific factors that affect company valuations, including an updated perspective on transaction activity and valuations, vendor strategic considerations, and the current M&A environment along with near-term expectations.

 

Presenters:

  • Jonathan Hodson-Walker: Managing Partner, Silverwood Partners
  • Joshua Stinehour: Managing Director, Silverwood Partners

 

 

2:15 pm – 2:40 pm

The Broadcast & Media Technology Industry in 2014

Top broadcast analyst Joe Zaller will present a summary of key data derived from a variety of broadcast market intelligence projects including the newly published 2014 Big Broadcast Survey (BBS), the industry’s definitive demand-side market report. Discussion topics will include strategic drivers of broadcast technology spending, key customer investment areas, new technology deployment trends, and the most significant industry trends impacting end-user purchasing decisions.

 

Presenter:

  • Joe Zaller: President, Devoncroft Partners

 

 

2:40 pm – 3:15 pm

Business Strategy Perspective From Industry Executives

This panel of recognized executives at leading vendors will offer views on the critical drivers of company valuation in the industry, the best practices the panelist’s have learned on how to evaluate M&A opportunities, and the preferred approach for integrating M&A into overall growth strategies. The panelists will also consider the question of how broader technology trends are impacting the vendor community in the industry.

Moderator:

  • Joe Zaller – President, Devoncroft Partners

 

Panelists:

  • Sam Blackman: CEO and Co-founder, Elemental Technologies
  • Louis Hernandez. Jr.: President and Chief Executive Officer, Avid
  • Joop Janssen: CEO, EVS
  • Michelle Munson: President, CEO and co-founder, Aspera, an IBM company

 

 

3:35 pm – 3:50 pm

IABM Research Overview

Peter White, Chief Executive of the IABM (the trade group that represents suppliers of broadcast technology worldwide), will present an overview of the latest end-user research from the IABM along with selected excerpts from the recently completed IABM DC Global Market Valuation Report, the industry’s definitive supply-side market report.

Presenter:

  • Peter White: Chief Executive Officer, IABM

 

 

3:50 pm – 4:20 pm

The Broadcast Buyer Perspective on Business Models, Trends, and Technology Advancement

A panel of technology decision makers at leading broadcasters will offer informed perspectives on the most significant industry trends affecting technology budgets and the technology purchase decision. The audience will benefit from an emphasis on the business implications of technology decisions to broadcasters.

 

Moderator:

Joe Zaller – President, Devoncroft Partners

 

Panelists:

  • Phil Braden: SVP Technology and Applications, PCCW Global
  • Del Parks: SVP Operations & Engineering, Sinclair Broadcast Group
  • Todd Daly: EVP Operations & Systems Engineering, Fox Broadcasting
  • Andy Tennant: Technology Director, Studios, ITV

 

 

4:20 pm – 4:45 pm

Keynote: Vince Roberts: CTO and EVP Global Operations, Disney/ABC Television Group

ABC/Disney EVP and CTO Vince Roberts will highlight the major business model challenges facing the industry and the implications to technology development. Mr. Roberts will focus on the actual commercial factors driving technology deployments today, and what can reasonably be expected in the near future. Referencing initiatives at Disney relating to topics such as IP-based infrastructure and the Cloud, the audience will gain an improved understanding of how changes in media consumption and fundamental technology transitions, ultimately affect technology vendors.

 

 

4:45 pm – 5:15 pm

Investor Perspectives on Industry

This panel of leading investment professionals in the media and entertainment sector will offer the audience the institutional investor’s perspective on the industry. The discussion will include the panelist’s intelligence-gathering plans for the NAB Show, views on the trends that are driving investment dollars in the sector, and a review of the characteristics influencing the evaluation of an investment opportunity.

Moderator:

Jonathan Hodson-Walker: Managing Partner, Silverwood Partners

 

Panelists

  • Jeff Parks, Founding Partner, Riverwood Partners
  • Rohan Rai: Director, Wasserstein & Company
  • Sunit Mukherjee: Principal, Symphony Technology Group

 

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Related Content:

2014 NAB Show Session Details – Shifting Media Economics: Impact on Strategy, Finance, and Technology

Download the full agenda and speaker biographies here

Save the Date: Third Annual Media Technology Strategy Conference at the NAB 2014 Show

 

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© Devoncroft Partners 2009 – 2014 All Rights Reserved.

 

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Arista Networks Files for $200 Million IPO

broadcast industry technology trends, broadcast industry trends, Broadcast technology vendor financials, SEC Filings | Posted by Joe Zaller
Apr 02 2014

IP switching vendor Arista Network has filed for an IPO and plans to raise as much as $200m.

The company has garnered a great deal of attention from leading broadcast technologists because one of its products enables frame-accurate switching of uncompressed HD-SDI video over IP (SMPTE 2022-6).

Arista, whose core customers are high-speed financial traders and cloud computing firms, had revenue of $361.2m in 2013, up 87% versus the previous year, and its net income doubled to $42.5m.

Based on these results, it’s clear that the company is aiming for data center and financial clients rather than the much smaller broadcast routing switcher market.

Nevertheless, Arista has made friends in high places in the broadcast world.

At the annual SMPTE technical conference in October 2013, Artista founder Andy Bechtolsheim co-presented a paper with Thomas Edwards, VP of Engineering & Development at FOX NE&O called “Video Processing in an FPGA-enabled Ethernet Switch,” which described how Fox has tested Arista’s product in its lab.  Although Bechtolsheim was careful to note that the demonstration was a proof-of-concept rather than a product, Edwards said that Arista products showed great promise, by performing extremely well and not dropping a single packet.

At the time of the 2013 SMPTE conference, Edwards said “FOX NE&O believes that professional media networking is the future of the broadcast plant, including the networked transport of our uncompressed high-definition live video streams. We believe that converging our video streams onto the Ethernet infrastructure will provide enhanced agility and flexibility to our business, and also it may potentially bring savings by allowing us to purchase more COTS hardware and thus benefit from economies of scale. The broadcast industry is at a very early point in this technological transition, so FOX NE&O greatly values Arista Networks’ contribution to this proof-of-concept to help test out some of the basic video processing requirements of professional media networks.”

Fox is not the only proponent of moving towards a truly IP-based infrastructure, governed by software defined networking (SDN). Indeed this shift may be one of the biggest technology trends over the next 5+ years, and bring major changes to the industry as a result.

Last month Eric Wolf, VP Technology Strategy at PBS told the audience at the HPA Technology Retreat that his company’s new disaster recovery center that’s based completely on virtualized IT systems, along with “little bits” of traditional broadcast gear.  Although this new facility is not yet based on SDN or cloud enabled, it’s the first step on the path.  DR is a great test facility so it’s a positive step along the way, “but as we look at our next big playout system, the big question on the table is whether we can go all IP for all the routing in the plant and the suspicion is that we can.”

Speaking at the same event, Fox NE&O EVP and GM Richard Friedel said IP is “well along the way towards becoming real. We do have IP-based routers in our plant today, and IP technology is just going to proliferate.  If you walk into any of our equipment rooms at the moment, there is almost no classic broadcast vendor anymore. Instead you’ll see rows of Hewlett Packard, IBM, and Cisco. We’re really in an all-IP world now. We’ve got huge virtualization farms already and this is coming. In five years no one will build a plant of our size that’s not based on IP concepts.”

But it’s not just IT companies who are pushing software defined networking.  Traditional broadcast vendors are also embracing SDN and applying it to the broadcast infrastructure.

Last week Imagine Communications (formerly Harris Broadcast) introduced MultiService SDN, which the company says is “a SDN framework that creates a fully virtualized network fabric for deploying advanced services, and enables the video bit flow to be software-mapped, simplifying the network architecture of media companies operating in hybrid environments with both baseband and IP workflows.”

Another notable example of this trend include a Silicon Valley start-up called SDVI, led by Omneon co-founder Larry Kaplan, who said last year that the focus of his new company is to bring SDN technology to the broadcast industry.

Belgium-based SDNsquare, whose CEO and co-founder, Lieven Vermale, is the former Director of Technology and Innovation at the European Broadcasting Union, is another start-up operating in this area.

One important group in the transition to IP-based broadcasting is the EBU-SMPTE-VSF Task Force on Networked Media (JT-NM), a cross-industry group of broadcasters and technology vendors working to define the future of the all-IP broadcast facility. You can download December 2013 JT-NM whitepaper here.

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Related Content:

Arista Networks S1 (IPO) Filing — March 31 2014

Press Release: Imagine Communications Introduces Software-Defined Networking and Workflows

EBU/SMPTE/VSF Joint Task Force on Networked Media (JT-NM) Gap Analysis Report, December 2013

VSF, EBU, and SMPTE Create Joint Task Force to Define Future of Networked Media for Professional Applications

Press Release: Arista Networks and Fox NE&O Debut Network Integrated IP-Video Processing Proof of Concept

Software Defined Networking – Coming Soon to a Broadcaster Near You?

VSF, EBU, and SMPTE Create Joint Task Force to Define Future of Networked Media for Professional Applications

TVTechnology Article: Larry Kaplan, Omneon Co-founder Launches Media Software Company

SDNsquare

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Broadcast Vendor M&A: Belden Completes Acquisition of Grass Valley, Will Invest $25 Million in Integration of Combined Business

Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Apr 01 2014

Belden announced that it has completed the acquisition of the previously announced offer to purchase Grass Valley. When the deal was announced in February 2014, Benden CFO Henk Derksen told equity analysts that the $220m deal would be funded with existing cash.

Grass Valley had approximately $290 million in revenue according to Belden’ press release, so the deal values Grass Valley at 0.75 revenue.

It is believed that the enlarged company will be branded Grass Valley.

According to Belden, the value of the combination of the two companies is clear for both customers and shareholders is clear. The company says that by aligning both resources and strategies, the business will have a broader offering, while realizing the benefits of scale.

Belden also says the combined company “will be able to deliver the ability to simplify the purchasing and management of highly complex infrastructures.”

Belden says acquisition of Grass Valley will be immediately accretive to adjusted earnings per share with an estimated impact of approximately $0.20 in 2014 and $0.50 in 2015.

Much of the increased profitability of the new company is likely to come through synergy savings.

One of the hallmarks and core competencies of the Belden team is the efficient integration of acquired companies into the Belden family, and the associated inculcation with the “Belden Business System, including LEAN enterprise techniques and the Market Delivery System.”

There are many examples of Belden buying underperforming companies and subsequently using its internal processes to achieve strong financial performance and operating return.

Indeed, the company says “there is a significant opportunity in the application of the Belden Business System” in the case of Grass Valley

Derksen told analysts at the time of the announcement that Belden plans “to invest approximately $25 million during the first 12 months of integration largely through restructuring efforts to capture the value of the combined company. The strategic actions will include cost actualization, manufacturing footprint and leveraging a combined sales and marketing function and the implementation of lean principles.”

At same time Belden CEO John Stroup said “the result of the integration is unlikely to include meaningful reductions in R&D investment. However, I think there’s going to be an opportunity for Miranda to throttle back on some investments where Grass Valley’s stronger and for Grass Valley to throttle back on opportunities where Miranda’s stronger. Manufacturing is a clear opportunity. Today, Grass Valley outsources a lot of their manufacturing. We think there’s an opportunity for us to leverage our existing fixed cost structure, absorb that manufacturing. So that’s a clear opportunity to create value in the combined business and there’s clearly an opportunity to leverage our global sales force. Both of us at 200 and 300 million respectively, have created a global sales force calling on the same customers and we see a clear opportunity to improve our efficiency there. So the assumptions that we have in place include manufacturing cost synergies as well as the opportunity to leverage the combined sales organization, both in terms of cost and revenue.”

 

The following slides show the strategic rationale for the Miranda – Grass Valley merger, as explained by Belden in February 2014.

 

Belden Buys Grass - 1

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Belden Buys Grass - 2.

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Belden Buys Grass - 3

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Belden Buys Grass - 4

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Belden Buys Grass - 5

 

 

Given that it is believed that the combined company will be branded as Grass Valley, the deal marks a new beginning rather than the end of the road for the formidable broadcast brand.

Prior to officially becoming part of Belden, what is now Grass Valley has been through a number of strategic changes in the last 10-15 years.

This started in December 2000 when Thomson purchased Philips Professional, which at that time had revenue of approximately 250m Euros, and employed 1,050 people. Philips products, which included cameras, film imaging, signal processing, media networking & control, and systems integration services, became part of Thomson Multimedia.

After the Philips acquisition, the combined company, which was renamed Thomson Multimedia, had combined revenue of approximately 366m Euros.

In 2001, Thomson bought Grass Valley in 2001 for $172m.  At that time, Grass Valley had revenues of about $200m.

Technicolor then went on a buying spree, acquiring multiple companies that were ultimately folded into the Grass Valley brand.

Thomson added to its Grass Valley holdings with the 2005 acquisition Canopus for more than $100m.

By the late 2000s Thomson – which had by this time changed its name to Technicolor – put Grass Valley on the block, initially with what has been described as a very high price tag.

After several rumored bids, and more than a year on the block Technicolor sold what is now Grass Valley to Francisco Partners, a San Francisco – based private equity firm.

Technicolor retained other parts of the business, including transmitters and head-end equipment, and later sold-off these assets in two separate transactions.

Technicolor sold the Grass Valley transmission business to PARTER Capital Group.

The Grass Valley head-end business was sold to FCDE in March 2011.

Grass Valley is one of the industry’s great companies and I am sure that the people there are happy to finally have resolved their fate.  Let’s hope they can now focus on making great products – and of course money for their new owners.

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Related Content:

Press Release: Belden Announces Successful Completion of Grass Valley Acquisition

Broadcast Vendor M&A: Belden Buys Grass Valley for $220 Million

Press Release: Technicolor to sell its Broadcast Services activity to Ericsson

Belden Q3 2012 Revenue Declines 6 Percent, Miranda “Off to a Slow Start”

Broadcast Vendor M&A: Miranda Buys Softel

Belden Closes Deal to Acquire Miranda

More Broadcast Vendor M&A: Belden Buys Miranda for $350 Million in All-Cash Deal

More Broadcast Vendor M&A: Technicolor Closes Deal to Dispose of Grass Valley Transmission Business

Technicolor Receives Binding Offer for Video Head-End Business

Technicolor decides not to sell digital signage provider PRN

Technicolor completes sale of Grass Valley to Francisco Partners

 

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Strong Performance in Middle East Drives Vislink Broadcast Revenue 2.2 Percent Higher in 2013

Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Mar 28 2014

UK-based Vislink plc, reported that its revenue for 2013 was $99.3m (£59.9m), up 4.7% versus 2012.

Broadcast industry revenue was $79.7m (£48.1m), up 2.2% versus 2012.

Vislink owns multiple broadcast brands including Advent, Link, MRC and Gigawave.  Earlier this month Vislink announced it had acquired playout automation provider Pebble Beach for $24.7m.

On a group basis (including both broadcast and government sectors):

  • 2013 operating profit of $7.1m (£4.3m), an increase of 40.3 per cent increase compared to 2012

 

  • Gross margins were 40.6% in 2013, up from 39.4% in 2012

 

  • Order intake for the year was $99.6m (£60.1m), and the company ended the year with an open order book of $9.3m (£5.6m), up 7.7% versus the end of 2012

 

Broadcast Performance

Vislink’s broadcast products include satellite terminals and wireless communication systems that are used live events such as news, sports, and entertainment.

2012 broadcast revenue was £48.1m, up 2.2% versus 2012. Broadcast revenue accounted for 80.3% of total group revenue, down from 82.3% of total group revenue in 2012.

Revenue from Pebble Beach is not included in these figures.

For the broadcast business, the company’s geographic performance was as follows:

 

Vislink - Broadcast Revenus 2013 vs 2012

 

On a percentage basis the company’s best performing region was the Middle East and Africa, where sales jumped 49% versus the previous year.

The UK market decline 19.3% in 2013 after a strong performance in 2012, driven in part by the London Olympics. The company had slight growth in the rest of Europe, and experienced a decline in APAC.

2013 broadcast revenue in the Americas was down 10.1% versus 2012.  Vislink attributed this decline to cyclicality, saying “the US broadcast marketplace typically sees a reduction in spend in a post presidential election year.”  At the same time however, the company specifically highlighted the importance of South America, saying that the 2014 World Cup and 2016 Olympics have provided “an impetus for further investment in both broadcast and surveillance.”

 

Acquisition of Pebble Beach

The company used its earnings announcement to highlight its recent $24.7m acquisition of playout automation provider Pebble Beach, saying it will “contribute to the strategy of achieving higher recurring services revenues and achieving our financial objectives of £80m revenue and £8m adjusted operating profit by the end of FY 2014.”

Vislink said the key benefits of Pebble Beach are leading software technology, recently developed next generation products, a growing customer base, and strong cash generation and growth prospects.

The company said the acquisition of Pebble Beach “fits perfectly with Vislink’s desire for growth, recurring revenues, extending its reach and providing customers with synergies, from capturing video to interactive programming, including acquisition and revenue generation. Vislink plans to grow its software capability around the Pebble Beach Systems and management team.”

 

 

Move to AIM Market Eases Burden of Future M&A

Following on from the recent acquisition of Pebble Beach, Vislink telegraphed its intention to do more M&A deals in the future, saying the company will “continue to seek growth opportunities both organically and through acquisitions, with a clear underlying objective of continuing to grow shareholder value.”

“We remain on track for our plan to grow the business to £80m, and £8.0m adjusted operating profit by the end of FY 2014, and we intend to support this by way of a number of “bolt on” acquisitions,” said Vislink chairman John Hawkins.

Significantly, during 2013 Vislink switched its stock market listing to the UK’s AIM exchange, the London Stock Exchange’s international market for smaller growing companies.  Vislink says that the move to the AIM exchange will “simplify and reduce the financial burden of making acquisitions.”

 

Strategy and Outlook:

The company said its “markets continue to be tough but as long as we continue to balance our revenues and maintain our product leadership, the group will grow profitably.”

Vislink said it plans to expand its capability in delivering recurring revenues by exploiting its “newly acquired software capability in video playout” (Pebble Beach), and will grow our services offering by developing our network capabilities in cellular and hybrid application areas.

Vislink finished the year with $6.1m (£3.7m) in cash, down from $13.4m (£8.1m) at the end of 2012.  The company said it has more than 250 employees worldwide.

 

 

Related Content:

Press Release: Vislink plc – Results for the year ended 31 December 2013

Broadcast Vendor M&A: Vislink Buys Pebble Beach for $24.7 Million

Broadcast Vendor M&A: Vislink Buys Amplifier Technology for up to $6.2 Million

Vislink Revenue Declines 7 Percent in Q3 2012, Reaffirms Plan to Double Revenue By End of 2014

More Broadcast Vendor M&A: Vislink Completes Acquisition of Gigawave for £3.75 Million

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Broadcast Vendor M&A: Kudelski Buys Rival Conditional Access Vendor Conax for $226 Million

Broadcast technology vendor financials, Broadcast Vendor M&A, Quarterly Results | Posted by Joe Zaller
Mar 27 2014

Swiss-based Kudelski said it will pay $226m to acquire rival conditional access provider, Conax AS, from Telenor Broadcast Holding AS.

This deal values Conax at approximately 2.2X revenue and 5.6X EBITDA.

In 2013 Conax had revenue of $103.7m, and EBITDA of $40.2m. In 2012 Conax had revenue of $96.1m and net income of $22.8m.

Kudelski, through its subsidiary Nagra, is one of the industry’s leading conditional access providers.  The company also owns pay TV middleware provider OpenTV, which it acquired from Liberty Media.

Buying Conax gives Kudelski another 380 customers in 85 countries, who between them serve approximately 140 million pay-tv consumers through a product portfolio encompassing both traditional broadcast products and complete solutions for multi-screen TV distribution.

André Kudelski, CEO of the eponymous company, says the addition of Conax will enable Kudelski to “further expand our customer portfolio in Asia, Latin America, Eastern Europe and Scandinavia.”

The deal will also help bolster Kudeslski’s pay TV revenue, which has been in decline.

In 2013 Kudelski reported pay TV-related revenue of $695m, down 4.4% versus 2012, including a year-on-year decline of 7.7% in Europe. In its 2013 annual report, Kudelski said that it expects weak fundamentals in Europe to continue to affect volumes in its core digital TV market.   Thus the addition of Conax makes sense for Kudelski.

The deal also makes sense for Telenor, which says that despite “a strong track record of international growth and high profitability, achieving global scale and enhancing market share will be key determinants of future success” in the highly competitive conditional access business.  Therefore Telenor has decided “the best way forward for Conax is with a new owner.”

Telenor says selling Conax “marks an important step for Telenor Broadcast in pursuing its stated strategy of focusing on its core activities within the Telenor Group.” One of Telenor’s core businesses, Canal Digital, will remain a Conax/Kudelski customer after the transaction.

The transaction is expected to close within 10 days.

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Related Content:

Press Release: Kudelski Group to Acquire Conax

Press Release: Telenor Broadcast divests Conax to Kudelski Group for NOK 1.5 billion

Press Release: Kudelski Group 2013 Annual Results

Kudelski 2013 Annual Report

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Speakers Announced for Third Annual NAB Show Event — Shifting Media Economics: Impact on Strategy, Finance, and Technology

broadcast industry technology trends, broadcast industry trends, broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A, market research | Posted by Joe Zaller
Mar 26 2014

If you are interested how the dramatic changes impacting the broadcast industry may shape its future, you won’t want to miss the third annual NAB Show event co-produced by Devoncroft, Silverwood Partners and the organizers of the NAB Show.

Now part of the NAB 2014 Broadcast Management Conference, this half-day session is called “Shifting Media Economics: Impact on Strategy, Finance, and Technology.” It will be held in room N235 of the Las Vegas Convention Center on Sunday April 6th from 1:30 p.m. to 6:00 p.m.

It will be held in room N235 of the Las Vegas Convention Center on Sunday April 6th from 1:30 p.m. to 6:00 p.m.

As always, this event features an intensive, information-packed series of presentations and panels that discuss the strategic trends and industry-specific factors influencing the value of media technology companies.

We’ve worked hard to put together an outstanding line-up of speakers and presenters, including top technology buyers, leading technology vendor CEOs, and private equity investors who will speak to the opportunities and challenges involved with financing the next phase of technology change in the industry.

The agenda offers attendees the informed opinions of technology purchasers, industry executives, market research organizations, and financial professionals. The event will serve as a thought-provoking kick-off to the 2014 NAB Show.

Highlights will include panel discussions featuring leading vendor CEOs, senior executives from leading broadcasters, and private equity investors who will speak to the opportunities and challenges involved with financing the next phase of technology change in the industry.

In addition, the audience will benefit from preliminary excerpts from the Devoncroft Big Broadcast Survey, the industry’s definitive demand-side market report, and the IABM DC Global Market Valuation Report, the industry’s definitive supply-side market report.

This session is intended for senior executives from technology vendors, end-users, and investment firms in the media technology sector.

Please click here for more information and/or to register.

 

Here’s the current agenda:

 

Shifting Media Economics: Impact on Strategy, Finance, and Technology

Sunday April 6, 2014

1:30 p.m. – 6:00 p.m.

Room N235 Las Vegas Convention Center

Part of the 2014 NAB Broadcast Management Conference

 

 

1:45 pm – 1:50 pm

WELCOME AND INTRODUCTION

Joe Zaller – President, Devoncroft Partners

 

 

1:50 pm – 2:15 pm

Strategic Industry Analysis: Valuations, M&A, and Equity Financing

Jonathan Hodson-Walker and Joshua Stinehour of Silverwood Partners will present an analysis of strategic industry trends and the specific factors that affect company valuations, including an updated perspective on transaction activity and valuations, vendor strategic considerations, and the current M&A environment along with near-term expectations.

 

Presenters:

  • Jonathan Hodson-Walker: Managing Partner, Silverwood Partners
  • Joshua Stinehour: Managing Director, Silverwood Partners

 

 

2:15 pm – 2:40 pm

The Broadcast & Media Technology Industry in 2014

Top broadcast analyst Joe Zaller will present a summary of key data derived from a variety of broadcast market intelligence projects including the newly published 2014 Big Broadcast Survey (BBS), the industry’s definitive demand-side market report. Discussion topics will include strategic drivers of broadcast technology spending, key customer investment areas, new technology deployment trends, and the most significant industry trends impacting end-user purchasing decisions.

 

Presenters:

  • Joe Zaller: President, Devoncroft Partners

 

 

2:40 pm – 3:15 pm

Business Strategy Perspective From Industry Executives

This panel of recognized executives at leading vendors will offer views on the critical drivers of company valuation in the industry, the best practices the panelist’s have learned on how to evaluate M&A opportunities, and the preferred approach for integrating M&A into overall growth strategies. The panelists will also consider the question of how broader technology trends are impacting the vendor community in the industry.

Moderator:

  • Joe Zaller – President, Devoncroft Partners

 

Panelists

  • Sam Blackman: CEO and Co-founder, Elemental Technologies
  • Louis Hernandez. Jr.: President and Chief Executive Officer, Avid
  • Joop Janssen: CEO, EVS
  • Michelle Munson: President, CEO and co-founder, Aspera, an IBM company

 

 

3:35 pm – 3:50 pm

IABM Research Overview

Peter White, Chief Executive of the IABM (the trade group that represents suppliers of broadcast technology worldwide), will present an overview of the latest end-user research from the IABM along with selected excerpts from the recently completed IABM DC Global Market Valuation Report, the industry’s definitive supply-side market report.

Presenter

  • Peter White: Chief Executive Officer, IABM

 

 

3:50 pm – 4:20 pm

The Broadcast Buyer Perspective on Business Models, Trends, and Technology Advancement

A panel of technology decision makers at leading broadcasters will offer informed perspectives on the most significant industry trends affecting technology budgets and the technology purchase decision. The audience will benefit from an emphasis on the business implications of technology decisions to broadcasters.

 

Moderator:

Joe Zaller – President, Devoncroft Partners

 

Panelists

  • Phil Braden: SVP Technology and Applications, PCCW Global
  • Del Parks: SVP Operations & Engineering, Sinclair Broadcast Group
  • Todd Daly: EVP Operations & Systems Engineering, Fox Broadcasting
  • Andy Tennant: Technology Director, Studios, ITV

 

 

4:20 pm – 4:45 pm

Keynote: Business Model Changes Technology Changes

ABC/Disney EVP and CTO Vince Roberts will highlight the major business model challenges facing the industry and the implications to technology development. Mr. Roberts will focus on the actual commercial factors driving technology deployments today, and what can reasonably be expected in the near future. Referencing initiatives at Disney relating to topics such as IP-based infrastructure and the Cloud, the audience will gain an improved understanding of how changes in media consumption and fundamental technology transitions, ultimately affect technology vendors.

Presenter:

Vince Roberts: CTO and EVP Global Operations, Disney/ABC Television Group

 

 

4:45 pm – 5:15 pm

Investor Perspectives on Industry

This panel of leading investment professionals in the media and entertainment sector will offer the audience the institutional investor’s perspective on the industry. The discussion will include the panelist’s intelligence-gathering plans for the NAB Show, views on the trends that are driving investment dollars in the sector, and a review of the characteristics influencing the evaluation of an investment opportunity.

Moderator:

Jonathan Hodson-Walker: Managing Partner, Silverwood Partners

 

Panelists

  • Marshall Haines: Managing Director, Symphony Technology Group
  • Jeff Parks, Founding Partner, Riverwood Partners
  • Rohan Rai: Director, Wasserstein & Company

 

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Related Content:

2014 NAB Show Session Details – Shifting Media Economics: Impact on Strategy, Finance, and Technology

Save the Date: Third Annual Media Technology Strategy Conference at the NAB 2014 Show

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© Devoncroft Partners 2009 – 2014 All Rights Reserved.

 

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Broadcast Vendor M&A: Electra Partners Buys Calrec Audio for $23.1 Million

Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Mar 24 2014

Leading broadcast audio console vendor Calrec Audio has been acquired by Electra Partners, a UK-based private equity firm for $23.1m (£14m) of equity and debt.

This is a relatively low valuation for Calrec Audio, which according to public records made an after-tax profit of $4.73m on revenue of $29.33m for the fiscal year ended March 31 2013.

Calrec’s products are primarily used for sports broadcasts and other live events. Its products are arguably the de-facto standard in the sports truck market, particularly in the United States.  Many broadcasters used the company’s products at the recent Sochi Olympics. For example, NBC Universal used five Calrec Artemis consoles in Sochi. Other Calrec customers include Al Jazeera, the BBC, CBS, Gamecreek, NEP and Sky.

The seller was consumer audio specialist D&M Holdings, which acquired Calrec Audio in 2007 for an undisclosed amount.

This is the second deal between D&M Holdings and Electra Partners in the past year. In June 2013, D&M sold audio specialist Allen & Heath to Electra for £43m. D&M acquired Allen & Heath in 2006 from Growth Capital Partners for £15m.

Part of our investment strategy when investing in Allen & Heath was to acquire additional businesses in the audio sector in order to create a group of market leading professional audio mixing brands,” said of Electra’s Investment Partner Charles Elkington. “We look forward to working with Roger Henderson and his team to continue to invest in developing new products for Calrec’s customers.”

“We are excited to be working with Electra Partners as we continue to develop our business into more international markets,” said Calrec Managing Director Roger Henderson.

Allen & Heath’s existing Chairman Malcolm Miller will work with both companies.

Having now sold both Calrec and Allen & Heath to Electra Partners, D&M Holdings has effectively exited the professional broadcast market.  D&M is best known for its consumer brands, which include Boston Acoustics, Denon, and Marantz.

In 2012 D&M Holdings sold off high-end consumer brand McIntosh Labs to Fine Sounds S.p.A. of Italy.

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Related Content:

Press Release: Electra Partners announces the acquisition of Calrec for £14 million

Press Releases: NBC Olympics’ Production of the 2014 Olympic Winter Games in Sochi to Utilize Five Artemis Consoles Provided

Broadcast Vendor M&A: PE Firm Acquires Allen & Heath Acquired in £43 Million Deal

Electra Partners – Allen & Heath Investment Rationale

D&M Sells McIntosh Labs to Italian High-End Marketer Backed by Private Equity

Press Release (2008):  D&M Holdings Acquires Calrec Audio of UK

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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Broadcast Vendor M&A: Barco Buys X2O Media for C$21 Million as Part of Plan to Diversify Beyond Display and Projection

Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Mar 19 2014

Digital signage provider X2O Media has been acquired by Barco for C$21m. The deal values Montreal-based X2O at a healthy 4X its 2013 revenue.

Barco says “X2O Media will be integrated in the Barco organization as a business venture, allowing it to continue the development of its platform technology, while leveraging its business growth from Barco’s worldwide sales and service presence.”

X2O Media was founded by serial entrepreneur David Wilkins who sold his previous company, VertigoXmedia, to Miranda Technologies for C$11 million in 2006.  The deal with Miranda excluded the digital signage business of VertigoX, which Wilkins re-launched as X2O Media.  Since that time, the company grew from 10 to 40 employees, and saw its revenue increase to C$5m by the end of 2013.

X2O was backed by Propulsion Ventures, which was also a backer of VertigoXMedia.

According to Barco CEO Eric Van Zele, part of the strategic rationale for X2O is to diversify Barco’s offering beyond display and projection technology.  Barco also says the X2O portfolio will allow it to better meet customer expectations regarding workflow and content management, while differentiating itself further from competition.

The deal also creates new market opportunities for X2O. According to Wilkins, X2O’s current market “is limited to North America, but benefiting from Barco’s global network we will be able to grow our activities worldwide.”

This is not Barco’s first foray into the digital signage arena, but the 4X revenue Barco is paying for X2O, is significantly more than its last deal.  In 2010, Barco acquired Belgium–based digital signage specialist dZine for what it said at that time was “less than 1 time annual sales of dZine excluding an earn-out provision over the next two and a half years.”  According to public records, dZine had revenue of €7.96m in 2010 ($10.5m based on 2010 for-x rate to Euro).  dZine posted revenue of €8.53m and €6.9m in 2011 and 2012, respectively, so it’s unclear whether the earn-out provision was ever triggered.

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Related Content:

Press Release: Barco acquires Montreal-based X2O Media, expanding its technology platform with advanced connectivity capabilities

Press Release (2012): X2O Media Raises Additional Equity Financing From Propulsion Ventures

Press Release (2010): Barco acquires digital signage specialist dZine

Press Release (2006): Miranda Technologies to Acquire VertigoXmedia

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© Devoncroft Partners 2009 – 2013. All Rights Reserved.

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Broadcast Vendor M&A: Vislink Buys Pebble Beach for $24.7 Million

Broadcast technology vendor financials, Broadcast Vendor M&A, Quarterly Results | Posted by Joe Zaller
Mar 19 2014

Vislink announced that it has acquired playout automation specialist Pebble Beach Systems for $24.7m (£14.9m). Pebble Beach will operate as a stand-alone unit within Vislink, and will continue to be run by its management, including founder Peter Hajittofi.

Under the terms of the deal, Vislink will pay £12.9m in cash, and £2m in newly issued Vislink shares.  Pebble Beach management must hold the new shares for at least two years. Vislink says the “transaction will be immediately earnings enhancing.”

For the fiscal year ended June 20, 2013, Pebble Beach had revenue of £5.64m, EBITDA of £1.3m, and profit before tax of £1.3m.  Thus the deal values the company at approximately 2.5x revenue, and 11.4x EBITDA. After backing out the £5.9m in cash Pebble Beach had in the bank, the net price paid by Vislink was £9m, valuing the deal at approximately 1.6x revenue and  7x EBITDA.

The fact that Vislink has made an acquisition is not surprising.

The company, which had revenue of £28m for the first half of 2013, has told the market for the past several years that it intends to grow its revenue to £80m, with 10% return on sales, by the end of 2014.  

Vislink, which recently moved its listing to the UK AIM market, has long-telegraphed telegraphed its intention to buy companies to achieve its stated goals for revenue growth and profitability.

In its most recent half-yearly results, company management said “we remain on track to grow the business to achieve turnover of £80m and £8m adjusted operating profit by the end of FY2014, and we intend to support this by a number of bolt on acquisitions in addition to achieving organic growth.”

However, it is interesting to note that Vislink decided to buy a  company in a different part of the broadcast value chain to help it achieve its stated intentions.

Vislink, which owns the Advent, Gigawave, Link, MRC, and PMR brands, is best known for its RF, microwave, and satellite communication products that are used by broadcasters in live production environments such as news and sports.

Pebble Beach products are used in broadcast playout applications, which does not have the same emphasis on live events.

Having said that, Vislink says that the Pebble Beach team will “assist Vislink in expanding its software capability as a Group,” so the acquisition could be the first of several deals that mark the beginning of a new business focus at Vislink.

Vislink explained the rationale for the deal saying Pebble Beach’s technology is complementary to its own, and that “the acquisition of Pebble Beach will move Vislink into the provision of software solutions for playout with advanced software technology,” and that “Vislink will now be able to offer broadcasters a complete ‘scene to screen’ solution.”  Vislink also highlighted the fact that Pebble Beach “will gain from access to significantly increased sales channels through the global network of over 900 broadcasters that Vislink works with as well as its international network of offices.”

“The acquisition fits perfectly into our long term strategy of acquiring software and services capability that we hope to drive recurring revenues for the group,” said Vislink chairman John Hawkins.

UK-based Pebble Beach has 60 employees, and regional offices in Dubai, Singapore, and the USA.

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Related Content:

Press Release: Vislink Acquires Pebble Beach

Broadcast Vendor M&A: Vislink Buys Amplifier Technology for up to $6.2 Million

Vislink Revenue Declines 7 Percent in Q3 2012, Reaffirms Plan to Double Revenue By End of 2014

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© Devoncroft Partners 2009 – 2014. All Rights Reserved.

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