Virage Then And Now

This is because WebWare integrates Virage with other software components to make open, SOAP and Web-based asset repositories. "One of the reasons that Virage has worked well in our accounts is that it is built on open source code and has a software development toolkit with APIs to which we can write. WebWare takes the Virage platform to the next step and weaves video workflow management. It also integrates other digital media types such as images, audio, and power point content along with the video into applications that are already in the enterprise such as portal management - and asset distribution systems," he explains.

Virage’s brand equity and top flight customer base attracted suitors in the past according to financial analyst Brian Alger, Securities Analyst at Pacific Growth, but the company remained independent. "The company offers proven solutions and has been very tightly managed, financially," reflects Alger. "For a variety of reasons largely outside its control, Virage didn’t capture the ramp and meet its potential revenues in 2000 and 2001. It’s unfortunate for Virage that the dot.com bubble burst at the time that it did. To their credit, they lasted a lot longer than other companies their size."

A lifeboat
Not only did the company survive, but if everything goes as planned, Virage will get a new lease on life. On July 10, 2003 Virage and Autonomy Corporation plc (NASDAQ: AUTN; LSE: AU; NASDAQ Europe: AUTN) a leading provider of infrastructure software for the enterprise, announced they had signed a definitive agreement under which Autonomy will acquire Virage for a purchase price of $1.10 per share in cash. The value of the acquisition is estimated to be approximately $25M, only 21% of Autonomy’s $120M cash reserve, according to the company’s July 23, 2003 financial statement .

By gaining access to the Autonomy cash resources, the breadth of Autonomy’s sales force, and the customer base that Autonomy has in markets Virage has not yet penetrated, Alger expects Virage to be able to increase its revenues, while expending less effort and money on product and technology development in the future. Alger believes that the Virage’s open source platform will make for easy integration with Autonomy-powered solutions.

Kris Marubio, VP of Marketing at Autonomy, says that in addition to its customer base, Virage’s brand equity in the streaming media and digital video industry is high on the list of reasons Autonomy sought the company. "We have detected a recent uptick in interest in our solutions from broadcast customers and corporate customers," Marubio observes. "They have a lot of video assets they want to integrate into their applications. Rather than building our own video logging and management platform, and then displacing the market leader, we decided it was faster, better for all customers and more cost effective for Autonomy to purchase Virage."