By Corey Moss
To begin, if you aren’t yet aware, on May 15th Enghouse Systems Limited announced that it had acquired Vidyo, Inc. for a purchase price of approximately $40 million. Vidyo’s annual revenue is approximately $60 million. See more here.
(Note: Enghouse Systems Limited is a leading global provider of enterprise software solutions serving a variety of vertical markets. Its strategy is to build a more diverse enterprise software company through strategic acquisitions and managed growth within its business sectors: Contact Center, Networks (OSS/BSS) and Transportation/Public Safety. Enghouse shares are listed on the Toronto Stock Exchange (TSX: ENGH). Further information about Enghouse is available at www.enghouse.com).
Vidyo, a company which began with great fanfare as a groundbreaking innovator in the realm of videoconferencing, has ended just about down for the count in a whimpering acquisition.
Founded in early 2004, Vidyo’s funding began in late 2004 and the company operated in stealth mode through the beginning of 2007, emerging from stealth mode at the beginning of 2008. In May 2010, Vidyo launched its Software Development Kit (SDK) enabling developers to build multipoint video conferencing applications into Android and Moblin- (built around the Intel Atom processor – has since been discontinued) based smart phones and tablets, and in 2011 the company made it’s first appearance at InfoComm.
I wrote this back in June 2014:
Here it is, the final chapter of a series that included highly worthy participants that exist in this new age of communications and collaboration. I decided to look up the term “disruptive forces” on Google and I came up with another term on Wikipedia – “disruptive innovation,” which is defined as an innovation that helps create a new market and value network that eventually disrupts an existing market and value network (over a few years or decades) displacing an earlier technology. The final company participating in the series may just be the company that created this particular pathway for others to follow in the industry.
Vidyo, based in Hackensack, New Jersey, began in 2005 as a start-up, embarking on an effort that would eventually result in a paradigm shift for the video conferencing industry by creating a brand new system architecture. Its solution would be based upon Scalable Video Coding (SVC), allowing for error resiliency which was absent in encoding schemes that were, up until that time, common throughout the industry. At the end of 2007, Vidyo fully emerged on the scene offering a full annual licensing price model, essentially lowering the startup cost barrier for organizations looking to implement a video conferencing solution. Vidyo initially shipped its software pre-loaded on off-the-shelf servers as well, to provide solution continuity in the industry while promoting a whole new video conferencing infrastructure that today runs as virtual machines in VMware environments. Since 2007, Vidyo has introduced high-resolution desktop and mobile video, and the world’s first software-based platform for video communications and collaboration to leverage the H.264 SVC standard — developed in large part by members of the company’s early team.
(From rAVe [Publications] Disruptive Forces in AV/IT – Part 5: Vidyo)
I had coined ‘Disruptive Forces’ in 2014 to describe the newer companies in videoconferencing/UC, those who essentially broke the norm of a hardware-only industry that many of us knew before that time – myself being in commercial AV integration sales from 1998 to 2012.
Vidyo’s co-founder Ofer Shapiro left Radvision in early 2004, to develop improved video conferencing networks.
In December 2014 I wrote Disruptive Forces: The Leaders Speak – Ofer Shapiro, Vidyo – an interview with the CEO (on rAVe [Publications]):
Profile: Ofer Shapiro, Vidyo co-founder and CEO, has been an innovative force at the heart of major architectural transformations in the videoconferencing industry since 1996 and led the successful commercialization and go-to-market strategies. Vidyo is a 300-person company with worldwide sales to the leading enterprise, service providers and vertical solution providers.
Ofer’s backstory: Ofer was integrally involved in the development of the first H.323 multi-point control unit architecture and gatekeepers, developed the use of Scalable Video Coding (SVC) for video conferencing, and led the development of a new media relay based architecture — the VidyoRouter. He holds an Master’s of Science in applied physics and is a named inventor on 47 issued patents. He was named a World Economic Forum Technology Pioneer, and received the Wall Street Journal Innovation Award for Disruption in the category of Internet, Networking and Broadband.
Ofer Shapiro is a true genius, as well as being a leading disruptor in the field as indicated – one of the driving elements behind my heavy usage of the term disruption at the time (which went on for a few more years as I had continued to notice industry disruption in other areas as well).
More information on Vidyo, its products and history can be found here.
My first encounter with Vidyo was in late 2012, months after I had come to Washington DC Metro, (I had been in commercial AV integration in NJ and NY prior to this), introduced to the company by a new friend who I met as a result of relocating to Virginia. One thing led to another and I was invited to attend a partner/client meeting that the company was holding in Arlington VA, where Ofer Shapiro and other executives would be. To say that I was excited to be attending this meeting was a total understatement – this was an opportunity like I had not had in years in commercial integration.
At this point, I had been working on putting together a consulting operation, known as DC Smart AV/IT – I became a Microsoft Partner, a Dell Partner (cloud), and had set up or had begun setting up relationships with other known tech companies, some in the AV industry as well. Consulting relationships were being put together, including with two groups of companies that were focused on corporate and higher education, and Federal government/military.
After being in commercial integration sales for that time, this was an absolutely strategic step for me in terms of dealing with companies in certain ways that I hadn’t quite done before. Of course, there was the conventional in terms of how it’s done in the industry between integrators and manufacturers, however here, with the introduction of Microsoft, Dell and companies in the videoconferencing space that had just begun to enter the market like Zoom, Blue Jeans, Pexip, Videxio, Acano (who later became part of Cisco again), the experience was more than an eye-opener, it was a new way of tech life in a sense.
Vidyo however was a bit of a different story, as I was thoroughly impressed with what the company was doing in terms of products and solutions when I attended that meeting in 2012, and it was my first real look at the new world of videoconferencing after my time in the industry with Tandberg (Cisco) and Polycom. The executives and others in the company impressed me to no end in terms of their knowledge – product, technology and industry-wise – and I did get to speak with Ofer Shapiro for about five minutes.
I do consider this to be one of the most enlightening conversations I have had in the industry to this date. Shapiro was extremely welcoming in terms of taking the time to talk, and he was fully-focused on what we were talking about, even with others talking around him. Not just focused, but laser-focused as I had gotten the idea at the time listening to him in other conversations as well. It was my first real look at the Vidyo platform, and it truly impressed me to no end as I was given product demos that day.
I was involved with a potential large Vidyo deal with a major university in 2013 (working as a consultant with a Vidyo reseller), which was ultimately lost to an online reseller (you can only imagine…).
In early 2014, Vidyo participated in an event with their own virtual video chat room, and I remember being a part of a chat room conversation with members of the Vidyo team (from my home office) – the only non-Vidyo person in the room, and I did ask a lot of questions.
Those two blogs that I wrote in 2014, the interview with Ofer Shapiro was highly inspiring (as much as that first meeting with him in 2012), and Mark Noble, the VP of Strategic Marketing, appealed to me as a driving force executive for the company. To me, at that time, Vidyo was truly lighting up the videoconferencing world – and as Shapiro went, so the company went.
When Shapiro left the CEO role to become Vice Chairman of the Board in February 2015, pursuing other opportunities as well (he ultimately left as Vice Chairman in March of this year), Eran Westman, formerly EVP Global Business at Ceragon Networks (a wireless backhaul specialist company) took over as CEO.
And the company began to go in a new direction.
Part 2 – Disruptive Calculation, coming soon.
With over 20 years in audio visual integration and IT/computer sales and consulting, Corey Moss is the owner of Convergent AV Media. Corey writes for the publication and hosts/produces podcasts – The AV Life, Convergent Tech Talk, Convergent Week and The AV Tech Trade. He has written for numerous industry publications about AV, IT, unified communications and collaboration (UCC), cloud and software, IoT, cybersecurity and more. He has also conducted interviews with AV and IT executives and global influencers. Find him talking about a whole lot of things, tech and otherwise. On LinkedInhttps://www.linkedin.com/in/mosscorey/.