ENGLEWOOD, COLO. — Harris Broadcast is targeting TV everywhere with the acquisition of Imagine Communications, a San Diego, Calif.-based company specializing in transcoding. The value of the transaction was not disclosed.
“We needed adaptive bit-rate transcoding,” said Charlie Vogt, CEO of Harris Broadcast. “It was in our roadmap, but we saw this market evolving faster than we felt like we could introduce our own product. That’s what drove us to look at the space.”
Vogt said the acquisition gives Harris Broadcast a bolder entrée into the cable space. Imagine’s customers include Time Warner Cable, Cox and Suddenlink, among others.
“They take us deeper into cable, and into the telco market—AT&T, Verizon, Vodaphone. They do give us this new vertical, and they give us a product that our broadcast customers are buying from someone else,” he said.
The bigger picture is the path to multiplatform delivery, particularly with adaptive bit-rate technology, said Glen LeBrun, Harris senior marketing director.
“I think real key is that in the ABR space, with TV everywhere, it’s about providing linear experience across multiple platforms with bandwidth constraints. Because it’s in a non-linear realm, you’re dealing with asset management, digital rights, [etc .] You also have a different a structure. You don’t run same ads on all platforms, so they’re dynamically inserted.”
Imagine holds five transcoding patents with one pending. Its “solutions” portfolio includes various MPEG-4 encoding and transcoding applications. The product line includes broadcast and streaming systems. The ICE Broadcast System, for example, is said to handle multiformat transcoding for up to 16 HD channel and 32 SDs in a 1 RU footprint. The ICE Streaming System is said to transcode up to “1,500 output profiles from a single blade [server] platform.” The company’s Dense Transcoder is said to cover more than 200 HD profiles per RU “and will replace an entire headend with a single box.”
In addition to giving Harris more access to new markets, Imagine transcoding will be integrated into Harris products. First will be the Selenio compression, networking and processing gear, branded “Selenio Next.”
Vogt, a telecom IP veteran who took the helm of Harris Broadcast last July, has made no bones about taking the business into the software realm. The Imagine acquisition, he said, lays the foundation for “true software-defined integration of sales, scheduling, automation, playout and delivery across both linear and non-linear content distribution networks,” invoking a phenomenon not entirely welcome in a business of proprietary hardware.
“When we see technology trends, we see customers virtualizing networks in private and public data centers,” he said. “You’re truly building a software-defined network. What this industry is going to experience faster than they think is the adoption of IP as an underlying technology and a hardware-independent architecture.”
SDNs, he said, put customer control at the network level as opposed to confining it to a physical facility.
“We see this industry evolving to software-defined networks,” he said. “While we have hardware, we’re mostly a software-embedded company.”
“I think there will be more change from SDN [in television] than there was in the telecom industry,” he said. “I’ve met about 120 customers. There are not to many meetings where they’re not discussing the aggressive transformation of the business. I don’t think there are any companies as prepared as Harris.”
While Imagine’s transcoding is not yet offered as software-as-a-service, there are applications of it that may be, Vogt said.
“They have a next-generation ABR chip, that from a price and performance perspective, is above everyone else. You’ll see us move ABR to a more software-oriented platform, and to provide a next-generation DVR in the cloud,” for the likes of perhaps Comcast or AT&T.
Imagine has around 50 employees, with headquarters in Southern California, and R&D in Netanya, Israel, where it was founded in 2000. As of May, 2010, it had secured $34 million in funding from Carmel Ventures of Herzliya, Israel; Court Square Ventures of Charlottesville, Va.; and Columbia Capital of Alexandria, Va.
Vogt said the integration of Imagine into Harris would commence immediately upon closing, which is expected to occur around Jan. 1, 2014.
“You’re talking to someone who’s bought and sold 17 companies,” he said. “I am not someone who leaves new companies on their own… There’s an aggressive plan to integrate the company.”
The San Diego offices likely will be moved to “one of our centers of excellence,” Vogt said. Further details will be released when the deal closes.
As for what’s on deck, Vogt stressed that Harris was still spending around $100 million on R&D.
“We’re pretty thoughtful about trying to grow organically. You’ll see us doing more technology acquisition than otherwise. We have scale and we have customers. The only place where we don’t have a footprint is telecom. Government is also an interesting space.”
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