HaiVision/Video Furnace Merger Brings Live HD Streaming to the Forefront

The marriage of streaming software and hardware solutions has always been a bit tenuous—most companies do well at one or the other, but not both. As a result, software and hardware products intended for the reseller channel have often required a significant amount of handholding or professional services from the product manufacturer, or an almost insurmountable amount of education on the reseller's part.

The end result has been a limited amount of adoption of streaming products by the reseller - or a consistent complaint of having large sales opportunities that a reseller generates taken back in-house by the product manufacturer as the complexity of the design and implementation rises.

One example, in the H.264 realm, is that streaming products—which arguably do a better job than H.264 videoconferencing product equivalents—have lagged years behind videoconferencing product sales rates, since the streaming products were more often presented as custom installation solutions rather than than low-latency, high-quality turnkey solutions a reseller could sell without a PhD in codecs and network topologies.

Which brings us to an interesting merger: In an interview on Tuesday, I had the opportunity to talk to key players at HaiVision and Video Furnace as they laid out their strategy for a merger and how they see it impacting the H.264 solutions marketplace.

Noting that HaiVision has been known for its hardware solutions, while Video Furnace has focused on software solutions around its server solution and InStream player, Joe Gaucher, Video Furnace founder and HaiVision’s new CTO, says he sees the merger as a way to combine advanced hardware and software expertise.

"We feel that the combination will be unmatched in the industry," said Gaucher, "and the overlap of our reseller channels provides an opportunity to leverage this combination to bring advanced IP video solutions to market."

The new company will be headquartered in Montreal, Quebec, changing the name to HaiVision Network Video to reflect Video Furnace's strong enterprise presence. Terms of the deal between the two private companies were not revealed.

"Our integration partners and customers are very excited about having a single vendor solution in this fragmented market space," said Mirko Wicha, president and CEO of HaiVision Network Video. "Solutions providers in the US and European markets had sought out both of our companies and have been combining our products in a variety of field-tested solutions, so the single-vendor approach allows us to accelerate delivery of new solutions."

Video Furnace also had a set-top box (STB) that has been used by a variety of clients, including U.S. Department of Defense applications, so one of the immediate benefits the merged company is discussing is the combination of the HaiVision encoders and Video Furnace STBs.

"Video Furnace supports the MAKO-HD H.264 HD network feeds for distribution to the VF-STB," said Peter Maag, HaiVision's VP of Marketing. "The VF-STB, which can be centrally managed and scheduled with the VF Station Manager, supports live video distribution of up to 1080p and WXGA, providing a solution for digital signage that eliminates proprietary architectures and centralizes creative signage resources."

With the National Association of Broadcasters (NAB) and InfoComm shows looming, which attract a large number of resellers in the AV integration and broadcast space, I asked about the continued presence at those shows and the Streaming Media shows.

"We look forward to a continued presence at all those shows," said Maag, "and our combined solutions mean that we'll be squarely moving into the streaming space with a solution that resellers and end users can understand and embrace."

Part of that vision requires integration between the two companies' products, and CEO Wicha said that is a top priority.

"In Q2 2009, we anticipate the entire Video Furnace system will support network attached video, specifically H.264 up to HD 1080p," said Wicha. "This means archive, record, video-on-demand and the InStream player, coupled with the hardware encoders, will provide an end-to-end HD Video Over IP distribution system designed for enterprise deployments."

The interviewees also reiterated the fact that the merger could occur easily for technical reasons, as both HaiVision and Video Furnace had been highly cognizant to adhere to the H.264 standards throughout the years of product development and implementations.

The company plans to hone its focus on four key markets that each has seen success in. Besides the enterprise market, where Video Furnace's InStream has been implemented as a "zero footprint" player that needed no desktop application loaded for viewing, both companies noted that government and military applications have been strong markets for their products, and that they expect that to continue after the merger.

One concern I raised along that line was the question of a Montreal-based company being a supplier of high-definition streaming products to the U.S. Department of Defense. Wicha noted that HaiVision's products had already been in significant use in all branches of the U.S. military, and that Canada's role as the largest trading partner with the U.S. had significant precedent in U.S. military procurement.

The two other markets the company expects to focus on are medical and education.

"We've already seen that our combined solutions can generate a cost reduction," said Gaucher. "We can connect operating rooms, labs, and conference facilities together, while also enabling video to the desktop, centralized recording, remote review, and Internet streaming. In some instances, we've been able to work with the reseller to show a potential client how they can reduce costs by more than 50 percent compared with traditional AV infrastructure."

While several other mergers in the CDN space have been announced in the last few days, as noted on Dan Rayburn's blog, this is one to watch in the software-hardware delivery space.