[Oliver Peters] “What makes you believe that they aren’t making money on MC or PT as individual products or business units right now?
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Recent history shows us that Avid has not been making a profit and losing lots of available cash. Avid seems to be carrying debt, which is something it has not done in a long time. So I think we can say that as a company that had MC as it’s flagship product, it did not work in a commoditized environment.
With the unveiling of Avid Everywhere, the conversation has changed. As has been stated by Avid folks themselves, MC (and PT, I would guess) are integral parts of the Avid Everywhere product not the other way around. They are there to drive sales and value of Avid Everywhere. Avid Everywhere is the new flagship product and a smart move, aimed directly at the core customer for Avid (large install, multi-user, broadcast etc). I think the company realized it’s not worth competing actively for the one man shop or small shop. One-off software sales just aren’t going to do it. Avid will lose small guys like me and that will be cool for them, because the money for them is in the large install with the server and media management products at the center. That’s who they want. Sell the subscription and the support contracts after the initial hardware sale. Pure cash without a real product. You push MC along just enough to keep this core happy and the subscriptions being renewed. And you could say that this core is a conservative group who are not comfortable on the bleeding edge, so R&D is moderate. Beautiful.
I expect to see Avid profitable in Q4 of this year with the rush of subscriptions. Next year will be interesting.
Scott Witthaus
Senior Editor/Post Production Supervisor
1708 Inc./Editorial
Professor, VCU Brandcenter