I've been thinking about this for some time, but recent events have made me even more certain that Avid--as a company--does not have long for this world in its current form.
Evidence Item 1 - Avid CFO resigns:
From Reuters "Avid Technology, Inc. announced in its Form 8-K that, Paul J. Milbury, Vice President and Chief Financial Officer of the Company, notified the Company of his intention to resign his position effective March 2, 2007, and Joel Legon, Vice President and Corporate Controller will become Acting Chief Financial Officer of the Company effective March 2, 2007."
Evidence Item 2 - Stock Guidance at NAB 2007.
Avid was so skittish about Apple's plans at NAB 2007 that they had to issue a stock guidance in advance warning about precipitous drops after any Apple announcements in Las Vegas.
Stock prices did drop almost 15% from April 26th to early May.
Evidence Item 3 - Avid CEO resigns
On July 16th CEO David Krall gave his two-weeks notice that he would step down from his position at the end of the month.
The stock--which had risen back to $38.01--traded recently around $30 representing a decline of 21% in just three weeks.
Evidence Item 4 - Avid axes 150 jobs
From the following:
http://www.studiodaily.com/main/news/8350.html
"Avid said yesterday that it would be cutting “approximately 150 positions primarily, but not exclusively, in the company’s Video business unit,” according to a release on its second quarter results."
"We are realigning the business to have a greater emphasis on selling storage, asset management, and, most importantly, services,” said Krall in a conference call yesterday to discuss the company's Q2 earnings. “Q2 was a record quarter in services, showing 38 percent growth over Q2 last year. In Europe, we more than doubled our service revenue year on year ... [but] product declines more than offset the increase in services in the U.S."
Summary
Product declines? Greater emphasis on storage and services? This sounds like the gutting of Avid's video focus and a transition to a commodity model that can leverage their storage expertise and back it up with costly services.
Put me on record--I don't think Avid has more than 3-4 years as an independent entity before they get bought up by someone else.I don't think Apple would purchase them since they've been able to leverage other technology into Final Cut Studio over the last few years (Silicon Color, Nothing Real, Proximity, etc...) without needing any of Avid's intellectual property.
I could see Microsoft purchasing them, which would probably make Apple pretty happy since MS probably wouldn't be able to leverage the property very effectively. This could drive even more people to the Final Cut platform if users felt Microsoft/Avid wasn't going to be supported very well.
Just my opinion, but I think the writing is on the wall.
tl
