Few multimedia centric business models

Disclaimer: This article is written based on my understanding of the companies and their product lines. Please check the web about the accuracy of the statistics, if you are referring to them. And these are my personal opinions.

Historically media centric product requirements had driven the DSP business. The DSP industry came into existence because of the marketing push from TI. TI spuns the new market now and then with their unique innovation. "I would also say that TI has had a positive impact on our business, in that they are stimulating the market. They have a lot of great technologies as well as excellent management and vision, and they are innovating and opening or at least stimulating new markets" says VP-sales of their competitor. Along with DSP silicon businesses, many techonological startups has seen their genesis, growth and success also. These companies business is based on developing and selling intellectual properties(IP) on multimedia codecs on particular DSPs.

Here are few success stories and few stories waiting to be etched in business history.

This company has often been featured while discussing IP based business model in DSP world. It was started in 2001 and had weathered almost all ups and downs in the industry till today. Now has more than 200 employees in India. With the close network of this company, he could garner a good name in high-value quality driven markets based on IPs on different multimedia codecs. Their major product idealogy was to sell hi-quality codecs till 2004, then slowly shifted the focus towards bigger system developments like IP video phone, Pesonal media players, streaming media devices, VoIP devices, essentially media centric consumer electronics devices. The revenue were around 4M US$ for 2005.

"Multimedia codecs IP business is profitable, but not a high revenue generating one" are the words of a young startup's co-founder. I spoke to this team last week. Their business model is again similar to the earlier company, but from a different origin. The team is right now very small, only five people working in small office,a 'garage-based-startup'. Their business model is debatable 'you still have enough room for startups to play around in IP based codecs business'. But their last year's revenue does the marketing. A big silicon vendor has licensed their codecs. Wow! isn't it enough to shut up the critics!

Before looking any further, let see few products offerings from these kind of companies:

Internet based streaming devices for entertainment (sling box, streaming servers, IPTV...)
Digital video broadcast (DTV)
Mobile multimedia devices (video players, PMPs, DVB-H...)

And the big daddy of all this business is this . It was started in mid 90's and went to IPO in early 2000. Now it is a huge company with lot of revenues coming from services work. They started as high value research based product development company, eventually stepped into services based on the customer requirements. Service business indeed found to be the best business model for any Indian IT company! You could find any business products and services in embedded and networking domain business in their offerings. Any startup eyeing for IPO route can't avoid these guys business lines. Well proven and viable, scalable and perfect fit for Indian IT climate.

The next company is a big success story in recent times. It was co-founded by 10-15 project leads from earlier one in 2001. Their growth was linked with ARM processors penetration to embedded market. For dummies, ARM is a micro processor similar to Intel processors, but for easy programmability, signal processing capabilites and soft RTLs. This company has proved the capabilities of ARM in video processing for the first time. It's a wonderful idea to piggyback with ARM's growth in embedded market. Their codecs become popular as more silicon companies started using ARM. Their clientele is very impressive before the selloff. It was sold at around US$ 33M.

Another company from same origin is this. The top architects from the earlier company came out after its acquisition and started this company. Here the business concentration is little different- media centred but in different domains like IPTV, surveillance, biomedical equipments, automotive safety equipments and other consumer electronic devices. I had spoken to their top managers today. Their past success is their visiting card. They could scale up their team to 20+ people in hardly 5 months of existence. That's impressive. Yet to strike any business deals, hope to see them in action soon.

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