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Saturday, March 01, 2014

AVID Delisted from NASDAQ

Avid was delisted from NASDAQ this week. No surprise as they had been flirting with this since September. They claim its about cleaning up 5 MILLION accounting record items and restating earnings.  Thats huge. It doesn't mean they are going away, just yet but it doesn't bode well for them either. According to company statements once they clean up their accounting issues they expect to be relsted on the NASDAQ by mid 2014. Maybe. What if it turns out that in this process they are in worse shape than stated which I suspect is the case. Well they won't just close their doors up, most likely. They will operate for at least a while and do some cutting. Given they've operated at a loss for many quarters, who knows that this may mean. Its possible they sell off their editing products to raise cash and get rid of products that aren't making them money or enough profit margin. They can live selling shared storage products and service contracts for those products.

Media composer is only a small part of Avid’s income. Go read their 10K report first. their NLE products amount to 10-15% of their income. they make most of their money in shared storage products & support for those products. then again it might not even be that much if they have been cooking the books.

Ask any ProTools user about the latest release – you have to update your hardware or you can’t run PT10. a lot of unhappy campers out there right now looking at alternative products.

Avid’s main problem is their arrogance. its in their slogan “We’re AVID”. WTF cares ? I’ve watched them screw their users over time and time again and handle them in ways no company that values their customers would. however they count on blind loyalty to their products and that the competition can’t compete – in their eyes. So while for the moment they might have a better product for reality TV shows, Adobe AnyWhere just adopted by CNN is about to eat that last bit of pie they had. Anywhere allows shared storage and collaboration across locations. While its for now a high end big price tag product, I’d expect smaller versions to trickle down and bits of its tech to come to PP.

You also have to realize that reality TV and high end features represent a very tiny part of the market compared to all the users out there. Unless they return to their old prices there is no way to sustain their product at current prices in such a small market segment.

Then consider they are limping a 20+ year old UI along. that doesn’t work so well either…. I truly doubt BMD would buy the MC product from them given that they are building some NLE tools into resolve and would more than likely expand this are a of the product.

So we'll see  how this story plays out for NAB and if they have their huge booth as usual or not.