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Interview
conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – July
16, 2012
CEOCFO:
Mr. Summers, what is the concept behind AllDigital?
Mr. Summers:
AllDigital is focused on providing digital broadcasting solutions to media
and entertainment, enterprise, faith-based, government and other
organizations. We specialize in taking their video assets and delivering
them to a variety of devices, including Apple and Android phones and
tablets.
CEOCFO:
How do you implement the concept?
Mr. Summers:
Basically, what we do is provide what we call “integration services,” to be
able to take traditional media, which can come in the form of things like
movies or live broadcasts, and convert them into formats that are compatible
with a number of different connected devices, such as iPads, iPhones,
desktop computers, and digital televisions.
CEOCFO: Is it one technology? In other
words, you convert it and then it can be used over all of these sources, or
is it dependent upon end use?
Mr. Summers:
It is physically dependent on the end use and where the content owner wants
to send their digital media. However, AllDigital is able to provide
solutions that reach most of the major devices that support high resolution
and high definition content such as movies and live television broadcasts.
One of our premier products
is MobileSBRTM, which uses a custom decision matrix when an
Android app starts up to determine and select the optimal stream for a
video. The program automatically detects and adjusts the video settings
based on the OS version and other factors, which allows us to offer a
consistent high-quality experience. We can use this technology across
projects.
CEOCFO: Would you give us an example of
a typical project that you have worked on; walk us through the steps?
Mr. Summers:
Sure, for example one of our clients is Rogers Communications up in Canada.
They are one of the largest consumer, cable and content providers in Canada.
They are also one of the largest retailers of cellular phones and related
technologies in Canada. Rogers wanted their subscribers to be able to
control their video recorders in their homes remotely through devices such
as iPads and iPhones. They also had a requirement where those subscribers
would be able to access their media, such as television programming, from
those DVRs within their home on the various devices. We were able to go in
and develop, virtually from scratch, a system that provides solutions to
Rogers and their more than two million subscribers who have access to this
platform and system. Additionally, we run it as a service for them on an
ongoing basis.
CEOCFO: Are you doing customized work
typically, are there any general solutions that you are able to build on?
Mr. Summers:
Repeatability is a huge goal for our company and I think we have been making
good progress toward that goal in recent months. We are focusing more on
projects in our realm of expertise. Some of our clients’ exciting ideas
require custom technologies to stay on the cutting-edge and if we see the
industry moving that direction, we will absolutely do the custom work for
that. Ultimately, every project is different based on the client’s existing
technologies that we need to integrate with, but we’ve really limited these
differences to create a solid standard for broadcasting that we can roll out
to other customers.
CEOCFO:
You are adding quality; you are adding the ability in general. What is the
competitive landscape?
Mr. Summers:
The competitive landscape is definitely one that is highly fragmented. There
are a number of companies that have been around for some time, five to
fifteen years, that are solving problems related to managing media assets,
and they solve those problems quite well. What makes AllDigital different is
that we look at the problem much more from the point of view of being a
broadcaster. We help our clients become broadcasters and manage the
distribution of their digital media to these different devices. We provide
much more of the complete food chain of being able to do everything from
ingest, store, prepare, secure, convert and
deliver your traditional media feeds to digital television and other devices.
CEOCFO: How do people learn about
AllDigital?
Mr. Summers:
Typically, our clients come from a variety of sources, but primarily through
word of mouth. Our management team has years of experience in the digital
media space and we have an extensive contact list of media and entertainment
companies.
We also advertise and
interact with targeted clients on the usual websites, like Google, LinkedIn
and Facebook, and those attract some interest. Additionally, some of our
projects have received a good deal of press as a result of working with some
well-known clients. All of this has helped us generate interest and new
growth mass.
CEOCFO: AllDigital can manage the
solution. Do most people use the additional services? What is the overall
revenue model?
Mr. Summers:
Yes, the revenue model today is in three phases; the initial consultative
and design phase, then we go through a build phase of putting together the
solution for the client, and then there is the run phase where we run it as
an ongoing service for the client. That is pretty much our current business
model. The first two stages are typically non-recurring revenue and then the
final run stage is a recurring revenue model.
CEOCFO: Do many people take advantage of
your recurring revenue services or is it still a new service for you?
Mr. Summers:
There is certainly what we call the “Netflix Problem”, which is when you are
running a complex digital service on a 24/7 basis you need a lot of
different resources, whether they are technology people, phone support
escalation, that sort of thing. By outsourcing the management and the run of
the service to a company like AllDigital, our clients can save tremendous
amounts of money over trying to do it themselves.
CEOCFO: Are there services you would
like to offer?
Mr. Summers:
We are always looking at new technologies, new opportunities in the
marketplace. I think the industry is definitely going in an interesting
direction similar to when Apple came out with iMovies a few years ago. A
blank DVD was a few dollars and the concept of creating their own DVD and
burning a home movie to it was almost magical at the time. Now we take that
for granted. We see a similar opportunity in digital broadcasting where the
industry is really at that magic moment where virtually anyone can now
become a broadcaster and reach a global audience with potentially billions
of people. Our vision as a company is really to be one of the leaders
providing solutions and technology that make that vision a reality.
CEOCFO: With the ever-changing
technology, how do you keep up and how do you know what is going to become
standard and what is going to be a flash in the pan?
Mr. Summers:
We definitely follow, to the best of our ability, industry trends. Our
clients look at us for that expertise. Some clients really turn to us for
industry expertise regarding devices and looking for a return on their
investment. Our knowledge base and expertise is extremely valuable, and
helps our clients be first to market and always creating the next big thing.
CEOCFO:
In general, do your customers look beyond just get-it-done-for-me, do they
come to you with set ideas or are you leading the way for what they should
be implementing?
Mr. Summers:
Sometimes it is a combination of the two. Sometimes our clients have a
vision of where they would like to go and maybe we have past experience that
will prevent them from making mistakes or doing things that are not best
practices. Our clients certainly see value in that. We are constantly
innovating and inventing. Our clients are always hungry to be first to
market with exciting new technologies that give them a competitive advantage
and the differentiation between themselves and the competition.
What is fun and exciting
about AllDigital is our innovative nature and we have had some really good
client success as a result. One of our clients is Miramax, which has a
number of “A” titles such as “Pulp Fiction,” “Chicago,” and hundreds of
others. They wanted to sell their movies through Facebook. Now people on
Facebook can purchase “Pulp Fiction,” or they can even give “Pulp Fiction”
to one of their friends, which is kind of a neat new distribution channel.
We love working with our clients and the creative ideas that they come up
with.
CEOCFO: Is security an issue?
Mr. Summers:
Definitely, security is an issue. Especially, for leading studio content
owners such as Miramax. If you are going to entrust hundreds of your movies
to a company like AllDigital you need to make sure that they have the
studio-approved security and digital rights management technologies to be
able to get the media securely from their servers all the way to the
destination device.
CEOCFO: How is business these days?
Mr.
Summers:
The industry is growing tremendously. There are now 9 billion
connected devices. That just provides an incredible landscape and
opportunity for people that are involved with digital media. We are really
excited about the emergence of digital television and digital television
technologies. Being able to create your own DVD and show it to your family,
five or ten years ago, was a really exciting moment. Over the course of the
next year you will see people being able to create their own television
programming and television shows and be able to compete for eyeballs with
the major media brands. We are excited to be right at the epicenter of that
whole shift in technology and this explosion of digital connected devices.
CEOCFO: What is the financial picture
like for AllDigital?
Mr. Summers:
We are publicly traded with a small cap stock under the symbol ADGL.OB. We
recently put out our financials for Q-1 which investors can take a look at
as well.
CEOCFO: Why should investors pay
attention to AllDigital today?
Mr. Summers:
If you are interested and believe in the digital media space, if you look at
the AllDigital management team, some of the client wins that we have been
able to garner in a relatively short period of time, the emergence of
digital television and the opportunities that we see in that particular
space-- it is an exciting time for AllDigital. AllDigital is well positioned
for the growth of connected devices and the explosion of digital media.
Hopefully that is something prospective investors take into consideration.
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