SeaChange International’s position at Liberty Global and the competitive OTT threat posed by MLB Advanced Media were among the hotter topics on the multiscreen video tech company’s fourth quarter call on Thursday morning.
SeaChange, whose product line include its Nucleus software for set-tops and gateways and its Adrenalin multiscreen video backoffice, among others, took a cautious tone with respect to growth activity in general and, in particular, with Liberty Global.
“I want to be as conservative as possible, because we do not control when Liberty expands and announces their expansions and takes down more licenses [for Nucleus],” SeaChange CEO Jay Samit said in response to a suggestion from an analyst that guidance (SeaChange expects first quarter revenues to be in the range of $22 million to $24 million) showed that SeaChange isn’t seeing a lot of momentum in Nucleus or Adrenalin. “It’s baked, it’s running great, it's doing phenomenal in Poland, but I do not control that timing. So to bake that into our numbers we know it will be a slow build quarter-by-quarter. This isn’t a back-ended year or some big hockey stick year.”
But he does expect another “significant decline in our legacy products,” offset by new design wins for Adrenalin and Nucleus.
Samit also addressed opportunities for Rave, its new software-as-a-service for premium OTT video platform, noting that SeaChange is responding to RFPs, just completed a Rave trial with a telco, and is in a trial with a long-standing customer of its previous-gen Axiom VOD backoffice platform. BBC Worldwide and Algar Telecom of Brazil are among SeaChange’s known Rave customers.
“We’re getting the calls from all the right customers,” Samit said, but acknowledged that he doesn’t expect Rave to “translate into GAAP for this year.”
With respect to Rave, SeaChange was also asked to address the general OTT competitive landscape, including some recent momentum by MLB Advanced Media, which includes some work with HBO and the premium programmer's Internet video products, including its new stand-alone service, HBO Now.
SeaChange, Samit said, is “dealing with a number of major media companies out there and we're not running across MLB, except in Wall Street Journal articles. They have got great technology, but they haven't set themselves up yet to really handle being in the service business, and that's one of our great advantages in that.”
On the financial front, SeaChange posted a fiscal fourth quarter net loss of $6.1 million (19 cents per share), on revenues of $31.3 million, versus $35.6 million in the year-ago quarter. Analysts were expecting a loss of 4 cents per share.
SeaChange shares closed down $1.05 (13.13%) to $6.95 each on Thursday.
