Avid acquires Sundance Digital
Avid Technology today acquired automation maker Sundance Digital for approximately $12 million in cash, a move that will let the company more tightly integrate its news production and server products with automation technology.
Sundance, based in the Dallas, TX area, is a developer of automation and device control software for broadcast video servers, tape transports, graphics systems and other broadcast station equipment.
“For more than a decade, Sundance Digital has been committed to developing leading-edge technologies that automate and control a broad range of playout devices, enabling broadcasters to operate more efficiently and deliver a higher degree of error-free transmissions,” says Chas Smith, vice president and general manager of Avid’s Video division. “Sundance has built a successful business with a family of open solutions that interoperate with major traffic and production systems from many companies.”
Smith says Avid plans to maintain Sundance’s market advantage while also exploring opportunities to extend its automation capabilities that Sundance already provides for our own transmission products. “With Sundance systems in our portfolio, Avid will offer more open and streamlined broadcast production workflows across the entire spectrum of media acquisition, production, and transmission,” says Smith.
The move is the latest by Avid to broaden its product portfolio and provide a more end-to-end solution. Nearly all of its broadcast products eventually pass content onto an automation system. By acquiring an automation provider the company can gain more market efficiencies and also more easily compete with Grass Valley and Harris Broadcast for clients looking for tighter product integration.
As a leader in the television automation industry, Sundance Digital has been providing cost-effective, high-performance solutions to public and commercial broadcasters since 1994.
The deal follows closely on the announcement that Avid’s total revenues for the quarter ended March 31, 2006 are estimated to be between $216 and $218 million, negatively impacted by lower-than expected sales of playout servers and on-air graphics, add-on and local storage, and European consumer products. At this revenue range, Avid s first quarter GAAP net income is expected to be in the range of $700,000 to $2.0 million, or $.02 to $.05 per diluted share. The company say s that preliminary analysis indicates that full year 2006 revenues are expected to be between $940 million and $970 million, reflecting lower expectations for the professional video and consumer segments. The company s audio segment revenue expectations for the balance of 2006 are unchanged.
The company says the main reasons for the slower sales are lower storage revenues in part due to a delay in add-on storage sales as customers transition to the new Avid Unity ISIS solution. The company also anticipates lower demand for playout servers and on-air graphics gear. Lastly, it says a higher proportion of larger broadcast bookings in 2006 will not be fully recognized until 2007, as the installation and acceptance of these transactions occurs. For consumer video, the company anticipates a continuing shortfall for the remainder of the year resulting from initial quality issues surrounding the introduction of Pinnacle Studio version 10.