Avid Sells Consumer Audio and Video Lines; Reduces Staff Another 20%

July 2nd, 2012 by

On the surface, it’s hard to say exactly how the latest news from Avid will affect Pro Tools users, if at all.

Avid sheds weight -- again.

There were two aspects of the company’s announcement today. First off, Avid is selling its consumer audio and video product lines: The audio portion will go to Rhode Island-based inMusic, which is the parent company of Akai Professional, Alesis and Numark, among other music production, performance, and DJ brands. The formerly-owned Avid products involved in this transaction include M-Audio and its multiple lines of keyboards, controllers, interfaces, speakers and digital DJ equipment and other product lines.

Meanwhile, Avid – based in Burlington, MA — made sure to say it will continue to develop and sell its audio products on the pro side: Pro Tools software and hardware, and PT’s associated I/O devices including Mbox and Fast Track.

The new owner of Avid’s consumer video editing line will be Corel Corporation, headquartered in Ottawa, Canada. The products covered there include Avid Studio, Pinnacle Studio, and the Avid Studio App for the Apple iPad, plus a number of other legacy video capture products.

The second aspect of the company’s announcement today was a by-now predictable wave of layoffs. The human toll here is sobering – 20% of the workforce – or approximately 350 people. Some Avid employees will transfer to the acquiring companies in each case, but a lot of talented audio and video development people now have to figure out what their next move will be.

Clear and Present Danger

As we posited at Avid’s last such announcement, when they restructured and shed 10% of the workforce last October, a future without Avid — and therefore, Pro Tools — is pulling even a little more clearly into focus.

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True, the sale only affects consumer divisions, which as Peter Kirn points out in CreateDigitalMusic accounts for only US$91 million of the US$677 million in sales Avid cleared in 2011. But still, Avid’s size has been going steadily in the same direction as its stock price for a long time now — down.

This does not seem like a company motivated from the top to pull itself out of its tailspin. While Avid CEO Gary Greenfield presented a positive picture of the moves — “The changes we are announcing today make Avid a more focused and agile company,” he said – this corporation as a whole must be feeling bleak about its prospects.

It would be great to be wrong, but a turnaround at Avid does not seem in the offing. Instead, it’s much more sensible to ask how much longer this company has got.  Its intensely dedicated pro audio team has been relentlessly updating the world’s industry standard music and sound production platform, but they must do so balanced on an ever-shakier foundation.

What’s Your Backup Plan?

At this rate, how much more support do Pro Tools users  have in front of them? How long will their systems last past that? And as we asked back in October, what company would really want to step up and conquer this apparently profitless – and often thankless – sector when Avid’s leadership ultimately inverts into a void?

Music production will surely change again when that happens.

For all who currently owns a Pro Tools system, there’s little else to with today’s announcement than put it on the “Wait-and-see” pile.

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For everyone in music production and post with a potential system changeover in their future, however, the red flags are flying stronger than ever: A future without Pro Tools is a real possibility. How will you prepare?

— David Weiss

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