Open Insight #2
Welcome to the second edition of Open Insight, where I will share thoughts and updates with our shareholders, other stakeholders and anyone with a general interest in the company. I aim to use this blog to tell you more about the projects we’re working on, how our customers are using our equipment and my vision for Net Insight’s future journey. (Naturally, we comply with stock market regulations, which means that information directly impacting earnings will be communicated through the regular channels).
I’m aiming to post a new blog about once a month. This update follows only three weeks after the first because I want to tell you about a pilot study relating to an exciting research project that’s just been confirmed. The project will be carried out alongside Sweden’s innovation agency Vinnova and KTH Royal Institute of Technology in Stockholm.
Research on time synchronization
As I mentioned in the first issue of Open Insight, our new strategy can be described as a journey in three stages. The first stage is to ensure a stable internal foundation. The second stage is to expand in markets where we’re already strong by developing existing products and working closely with our customers. In the third stage, we will expand into adjacent and new markets where our products, services and expertise have potential.
We are focusing on stages one and two over the next few years, but we need to prepare for stage three – the expansion into adjacent markets. This means that it’s important to carry out our own research and development and also engage in broader projects that could lead to entirely new products and business in the longer term.
A basic requirement for live broadcasts is that video content from different cameras is delivered at exactly the right time. This can be very challenging during remote production, as many different cameras deliver video that needs to be combined into a single production in real-time. If the synchronization isn’t perfect, video feeds from different cameras won’t be in phase with each other, while individual camera feeds also risk disappearing entirely. Even a small difference will be noticeable and irritating to viewers, if the video feed appears at all. Our Nimbra products have patented technology that enables synchronization without the complex and costly GPS antenna normally associated with this function. Synchronization is embedded in the product itself.
Developing synchronization solutions for time-critical transmission is desirable, as it has the potential to enable different applications and open up entirely new market segments. We’re now starting a pilot research study on real time communication. Iit’s just been confirmed that Vinnova is coming in as co-financier and KTH will provide the research resources. The aim of the project is to evaluate the product requirements and market potential.
At present, we obviously can’t say for sure what new expertise could emerge from the research. And we can’t predict how it might be used in our own research and development, or in future products. The project aims to examine different applications of our technology and compare these with other solutions that might be available. The fact that there’s strong interest in time synchronization in the market and in the academic world is great to see and potentially significant.
In the third stage of our new strategy, we aim to expand into new markets and envisage that we’ll gradually develop products that can create new uses for time-critical media transmission. This could lead to technology-driven operations in areas such as fintech, med-tech, defense, telecom, power transmission or other areas with high demands on precision in time synchronization. The outcome of all this is not definite, but I envisage that we’ll be on a very exciting journey over the next ten years.
Apart from this promising pilot, we’re also entering into a collaboration with the German company Meinberg, a leading specialist in synchronization applications, to review the market potential in this area.
I wanted to tell you about these initiatives, not because they have an immediate impact on our operations or income. As an industry leader, we want to invest in developing new knowledge.
Tata Communications invests
Tata Communications, a global leader in high-quality transmission capacity, is investing heavily in extending its 100G media network with our high capacity platform Nimbra 1060. We announced this at the beginning of the year. Our products are being installed in Tata’s network to make it a highly attractive service provider for many different media applications. For example, remote production is on the increase. Instead of sending large production teams to different arenas and other recording locations, video streams are sent unedited to a central production unit where editing takes place. Remote production is not new but there was some hesitancy about adoption, like all new ways of working. Production companies have traditionally sent out fully staffed OB buses carrying all the production technology to every arena. The Covid pandemic has now made the shift to remote production a massive imperative. Market researcher Omdia forecasts that the market for remote production will grow by 33% per year between 2020 and 2024.
Tata is a global giant, handling an estimated third of the world’s internet infrastructure. The company’s investments in high-quality, cost-effective transmission drive progress. We see the same trend globally: investments in networks and transmission capacity drive user and service developments, which lead to investments in new technology.
IP and cloud-based services
Customers like Tata illustrate momentum toward investing in increased capacity, with an increased focus on the IP-based standard SMPTE ST 2110 and cloud services to open up new markets. Our customers see a considerable benefit in using IP-based transmission to increase flexibility. Our Nimbra and Aperi platforms both have large installed bases and provide an easy route to unlocking the benefits of IP networks. We’re currently focusing on finalizing several software updates that will soon increase usability even further.
The other major trend is cloud-based solutions. We have just launched the next generation of Nimbra Edge, the cornerstone of our focus on open cloud technology. Nimbra Edge is already installed with some customers and is driving plenty of interest amongst others. Helping our customers to gain maximum benefit from the transition to IP and cloud distribution is key to our growth.
As I said at the beginning of this update, our immediate focus is on strengthening our organizational resources to ensure a stable foundation for growth. In particular, we’re focusing on strengthening the sales organization to ensure that we win all the deals I believe we can win. Phase two of the strategy means that we develop our core business by upgrading products and filling all the gaps in our offering. We shouldn’t lose a major deal because we can’t provide some small part of the chain. I’m already looking forward to expanding into new markets, developing new applications and finding new customers. I’ll be presenting more of my thoughts on this in future issues of Open Insight.