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The Moving Picture: Avid at the Apex
Posted Apr 25, 2005 Print Version     Page 1of 1

At the high end of digital video editing, Avid Technology is clearly the market leader and has been for some time. After all, it's pretty impressive to be able to claim statistics like having Avid products used on all five Best Picture Oscar nominees and roughly 98% of primetime network television programming over the last few years. Avid's recently announced acquisition of Pinnacle Systems should only further that position by adding complementary professional broadcast and live production tools to the product portfolio.

Yet, Avid has been a little less dominant over the years with the products targeting the EventDV and independent videographer market. That's not to say that Avid Xpress isn't a great product or set of tools, but certainly 5 out of 5 event videographers don't use it. There are many other legitimate options available to videographers, often at a lower cost than Avid's premium prices. Pinnacle, with both the consumer-oriented, yet powerful Studio editing software and the Liquid family of prosumer editors, has been one of those competitors, and that makes Avid's pending acquisition of Pinnacle both exciting and somewhat tenuous.

Both companies are publicly traded and that mandates that neither speak publicly about current or future product plans, except to say that they will both continue to manufacture, sell, and support all current products--at least until the transaction closes. Still, there are a few predictions we can reasonably make at this stage.

At the high end, Avid just gets stronger. Avid's President, David Krall, has already pointed to the synergies between two respective product lines, especially with Pinnacle's broadcast products. Avid's strength is in building top editing systems, and many Avid customers already use Pinnacle's play-to-air products, like Deko Titler, Thunder, and MediaStream. Putting them under one roof, and into the portfolio of one sales force, is a logical move that should only strengthen Avid's core business.

The most visible change from the Pinnacle acquisition, however, will likely come from Studio. It's the current clear market leader in the Windows-platform consumer editing and immediately brings a broad base of new users—many of them future customers for Avid's higher-end products--into the fold.

This isn't Avid's first trip down the consumer road, although it's been several years since the last one. In the mid-1990s, Avid launched a product called Avid Cinema which included template shot lists and storyboards to help amateurs both shoot and edit events like birthday parties, vacations, and sports. Avid Cinema was not a success, although the more modest analog camcorders and capture hardware of the day should shoulder more of the blame than Avid's software. Today, in the era of high-quality consumer digital camcorders and easy capture, as well as the stereotypical ease with which young people approach technology, Pinnacle Studio has been a strong source of revenue. Acquiring Studio, complete with a well-oiled distribution and sales channel, immediately puts Avid into a market-leading position.

Avid knows, just as with a decade ago, that maintaining a leadership position means planning for tomorrow. Cinema attempted to get the Avid brand in front of the high-end editors of tomorrow. That's especially important today because aspiring editors can learn their future trades on increasingly sophisticated, yet affordable interfaces from companies like Adobe, Canopus, Ulead, Sony Media Software, and Apple. Indeed, Apple, with products spanning from iMovie to Final Cut Pro, may be Avid's biggest threat, and acquiring Studio enables Avid to meet Apple head on.

What remains to be seen is how much Avid will tinker with Studio's branding and interface. As the market leader, "Pinnacle Studio" is a known consumer brand. Changing to "Avid Studio," even ignoring the confusion that would create with Avid Xpress Studio, will be tricky, yet inevitable if Avid is to put its brand out to future editors. Making over the Studio interface could be even riskier and more rewarding if it offers aspiring editors a flavor of the Avid timeline. Already Studio brilliantly allows users to toggle between storyboard and timeline views of their products. Avid's timeline is less intuitive on the surface than either, but that only makes Studio a potentially more powerful teaching tool if Avid can tweak the Studio timeline to hint more of Avid's higher-end approach.

Pinnacle's Liquid line, including Liquid Edition, is probably in the most tenuous position in an Avid-owned world. On the one hand, at least until the most recent version of Xpress, Avid struggled with giving its corporate/independent-level product enough power to compete, but not so much that it would eat into the company's higher-end sales. Liquid Edition currently sells for less than half the price of Xpress Pro--and exactly the same price as XpressDV, thanks to its price drop at NAB--without yielding much in functionality, at least not on the spec sheet. The hardware/software integrated version of Liquid competes quite directly with the Xpress Pro. What's more, Liquid's entire look and feel are quite a bit different from any of Avid's current products.

Can Avid find a middle ground for Liquid Edition somewhere between Studio and Xpress? That would be nice, especially given Edition's novel all-in-one editing/DVD authoring timeline. However, it may be just as likely that Avid will leverage some of the technology from Edition, like native (without conversion) HDV editing and blend it into Xpress.

Best-guess speculation aside, we'll have to wait until the acquisition is completed--probably sometime this summer—before we find out what Avid has in mind.

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