The Biggest Streaming Media Mergers and Acquisitions of 2013
“Our passion and our mission was to give you the best way to make and share beautiful movies made from the photos and videos on your phone,” said Hans Ku on a Ptch blog post announcing the company’s acquisition by Yahoo. “Well, someone noticed! Today, we’re excited to announce that Ptch will be joining Yahoo! As part of the Yahoo team, we’ll be able to focus our efforts and leverage our technology to make Yahoo’s photo and video platforms the best in the world.”
When it comes to positive PR, nothing beats the joy of an entrepreneur rewarded by a corporate behemoth.
Not stopping even to catch its breath, Yahoo soldiered on with the acquisition of a live concert streaming platform called Evntlive. Yes, there’s an E missing in the name, but it’s probably for enterprise, not entertainment, since Evntlive was a consumer-facing service providing on-demand concerts for free or through pay-per-view. According to Screen Digest’s Eleni Marouli, Evntlive offered “extra features such as backstage interviews, interaction with other fans, and a marketplace for songs and albums.” The company was founded in April 2013 and acquired in early December, making it one of the fastest streaming media acquisitions in recent memory.
Yahoo plans to integrate the technologies into Yahoo Screen and Yahoo Music. Both Evntlive and Ptch will have shut down their respective sites by the time you read this article.
IBM Acquires Aspera
Yet even the dual Yahoo acquisitions weren’t the last gifts of the year to streaming media company shareholders, as another big name stepped in to buy itself some speed.
On the last day of the business year, IBM made an announcement that it was acquiring file acceleration company Aspera. No purchase price was revealed, but this move siphons off one of the last independent reliable UDP (R-UDP) companies that Streaming Media’s Dom Robinson covered in his 2012 Streaming Media magazine article “Reliable UDP (RUDP): The Next Big Streaming Protocol?”
“Aspera is indeed essentially providing variations on the RUDP theme,” wrote Robinson. “It provides protocols and applications that sit on top of those protocols to enable fast file distribution over controlled network links ... targeting enterprises that handle high volumes of latency-sensitive data. You can license the software or, through the Amazon [Web Services Direct Connect] model, pay for the service by the hour as a premium AWS service.”
Akamai, a CDN competitor to Verizon, purchased a slightly different form of web and caching acceleration in late 2011, paying a whopping $268 million for Cotendo, whose web acceleration services have been used by AT&T and others in the 3 years between Cotendo’s founding and Akamai’s acquisition. It will be interesting to see if IBM’s recent acquisition of Aspera drives its customers toward other acceleration platforms from Akamai or Verizon.
IBM says Aspera will let its customers “take time out of the process of collecting, moving and distributing large data sets across global digital supply chains,” offering as an example an Aspera customer who reduced a transcontinental 2GB video file transfer “from 3.5 hours to less than 5 minutes once Aspera was installed.”
KIT Digital Rises Again as Piksel
One company, KIT Digital, deserves mention as we close out this year’s Streamticker. KIT Digital made our M&A watch each one of the past few years, as the company gobbled up numerous competitors in Europe and the United States.
Yet KIT Digital itself failed to survive 2013, even though it had what seemed to be an impressive customer base from its years of acquisitions. One acquisition, Ioko, specialized in large-scale, complex deployments for companies including AT&T, BBC, BSkyB, Disney, Electronic Arts, ITV, Liberty Global, LoveFilm, Samsung, Universal Music Group, and Univision.
In April 2013, just after the NAB show, KIT Digital telegraphed its intent to rename itself Piksel. There’s no X in Piksel, but there is certainly a bit more money, at least for the new shareholders.
“KIT is not saying how much the top three shareholders (Prescott Group Capital Management, JEC Capital Partners, and Ratio Capital Partners) are investing in the new entity, or what percentage of shares they own, but will do so during the bankruptcy process,” wrote Dan Rayburn on April 16, 2013. “Current shareholders will be able to buy warrants in the new entity and invest in Piksel, but any stock they have in KIT won’t be converted to the new company.”
The start of 2014 brought an end to the saga. While the company had streamlined locales, closing 17 office locations, and personnel, at 800 in early 2013 versus 1,400 in mid-2012, the company still was facing opposition from attorneys representing those who had unsecured debts.
“Creditors of KIT Digital Inc. are protesting the company’s bankruptcy rescue plan,” Katy Stech wrote, “a $25 million deal with investment funds that would take over nearly 90 percent of its ownership -- over payments that they said could unfairly flow to shareholders even if the company’s unsecured debts aren’t paid off first.”
“Paying shareholders before unsecured creditors are fully compensated violates the U.S. Bankruptcy Code,” Jeffrey L. Cohen, an attorney representing the official committee of unsecured creditors, told Stech.
As of late August 2013, KIT digital emerged from Chapter 11 proceedings, with a new name, Piksel. The company completed rebranding efforts during a relaunch coinciding with the IBC tradeshow in Amsterdam in early September. The company has now put both the KITD and newer KITDQ ticker symbols behind it. As Vivien Leigh so famously said at the end of Gone With the Wind, “After all, tomorrow is another day.”
This article appears in the 2014 Streaming Media Sourcebook as Streamticker 2014. This online version includes some minor updates to reflect changes since the writing of the article in January.
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