RGB Networks Sold to Imagine Communications for Undisclosed Sum

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Imagine Communications, a company with a long history in serving global television broadcasters, announced that it is acquiring RGB Networks.

The announcement is the fourth acquisition under the leadership of Imagine Communications’ chief executive Charlie Vogt in a little under a year. Terms of the deal were not disclosed.

For its part, Imagine sees the acquisition of RGB Networks as a way to position itself and “define the blueprint for an IP, software-defined, cloud-virtualized, multiscreen future” that includes both traditional broadcast gear and more flexible FPGA- and GPP-based transcoding and transrating options.

RGB Networks, which has been in business for almost 17 years, has been led by Jef Graham, its chairman and CEO, on a path towards software-defined video that started almost 5 years ago.

At that point, RGB Networks products were primarily based on digital signal processors (DSPs) and field-programmable gate array (FPGAs) that were suited for locked-in standards, such as MPEG-2 Transport Stream (M2TS), but were not as well suited for flexible needs such as H.264/MPEG-4 or emerging codecs such as the On2—now Google—VP8 and VP9 codecs.

To address that, RGB Networks acquired one of the industry’s second wave of software-defined transcoding workflow companies, RipCode. The June 2010 acquisition of RipCode moved RGB Networks towards a software-defined approach that was more agile and flexible than the traditional FPGA five-nines telecom approach that RGB Networks had been involved with up to that point.

Just prior to the acquisition, RipCode had signed on to be part of a best practices workflow study that this writer's firm, Transitions, Inc., was conducting, which included Elemental and Inlet Technologies, among others. The new owners, though, took the comparisons off the table, perhaps to address some of the shortcomings of the RipCode software-only solution.

What has emerged since then is a second-generation of the Video Multiprocessing Gateway (VMG) that is a key part of Imagine’s purchase of RGB Networks.

“Our customers require video solutions that enable content to be delivered anywhere, anytime, and on any device,” said Imagine’s Vogt.  “The acquisition of RGB Networks, combined with our innovation in video playout and distribution, enables us to strategically navigate the convergence of IP, mobility, and the internet, which has changed the way we consume entertainment and information.”

Worth noting is just how rapidly the market dynamics—and the need to address numerous devices and HTTP-based delivery technologies—have evolved in the past five years since the RipCode acquisition by RGB Networks.

Back in 2013, RGB Networks announced that it had reached 2 simultaneous milestones: 15 years as an independent company and $300 million in lifetime shipments of product. Back then, Graham referred to the abundance of devices choices for media consumption as “Multiscreen 2.0” problems that RGB Networks’ solutions could address.

“The market has changed on many fronts with the introduction of new services, new technologies, and most significantly, the emergence of new competition for our customers,” said Graham in a June 11, 2013, press release. “We’re proud that the world’s leading video service providers (VSPs) turn to RGB when they face new video processing challenges.”

Over the past two years, those additional challenges led the company to explore new revenue avenues, including enhancements to its advertising insertion portfolio to allow, as RGB Networks defined it in 2013, its customers to “simultaneously seek to monetize these new multiscreen services to recoup development costs and generate new revenues”.

In today’s announcement, Graham focused on the ad insertion technology and how it fits in to the larger adaptive bitrate (ABR) and HTTP-based technologies, such as MPEG-DASH or Apple’s HTTP Live Streaming (HLS).

“RGB Networks’ Dynamic Ad Insertion (DAI) technology is designed for ABR and virtualized data-center/cloud environments, and is structured to dynamically manage and execute addressable ad and alternate content campaigns in unison,” Graham said.

Based on Graham’s comments, he sees a strong synergy with Imagine’s existing base of almost 3 million broadcast products that Imagine has shipped over the years.

“By integrating RGB Networks’ streaming Dynamic Ad Insertion capabilities into its media portfolio, Imagine Communications will enable the delivery of personalized advertising in real-time, across all video stream types, and on subscribers’ preferred viewing devices,” Graham said.

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