The Avid-Pinnacle Puzzle
Issue: Volume: 28 Issue: 5 (May 2005)

The Avid-Pinnacle Puzzle

First of all, the digital video industry doesn’t make mass-market cars or computers, but rather specialized tools for a specific craft. And more significant, digital video may be a growth industry, but it’s not growing fast enough to support all of its pioneers.

Indeed, over the past few years both Avid and Pinnacle have done their share of shaking up the industry by gobbling up other companies. For example, Pinnacle’s current product line boasts technology and products acquired from once well-known companies such as Truevision, Deko, Minerva, Miro, Puffin Design, Fast, Dazzle, Hollywood FX, and Steinberg Audio. But Pinnacle’s resale of Steinberg to Yamaha late last year hinted at the financial strain of a company no longer hitting financial goals.

The good news for the digital video community is that Avid and Pinnacle are actually a pretty good fit, at least in most areas. The two companies have already been partners for a lot longer than they’ve been true competitors. In fact, Truevision was the OEM supplier of Avid’s editing I/O hardware. Also, Pinnacle’s Aladdin and Genie FX hardware were the first real-time effects preview engines for early Avid Media Composers. And more recently, when Avid was strapped for cash, Pinnacle bought Avid’s Sports Division, which now boasts an impressive list of customers-including major and minor league franchises and NCAA sports programs in just about every major sport-and a healthy revenue stream.

At the higher end of the professional video production market, the Pinnacle acquisition is likely to be more of a boon than a diminution of competition and choices. Avid dominates the higher end of the editing market with products like Symphony and Avid DS Nitro, while Pinnacle’s high-end focus has been the broadcast market, featuring live production and play-to-air solutions such as the Deko live-production titler and the MediaStream and Thunder on-air digital servers.

There is some overlap, of course, between Avid’s iNews and Pinnacle’s Vortex news editing systems. Avid’s AirSpeed and Pinnacle’s Palladium Media Servers both handle ingest and playout tasks. But Avid’s Unity can add proprietary shared storage solutions to both, and Pinnacle’s MediaStream is a standalone play-to-air server that can use either as a client. Since many Avid customers already use those Pinnacle products in conjunction with Avid editing stations, putting them under one R&D roof should only enhance the shared metadata and the facility for working together. It would also streamline user support for an entire production infrastructure.

When it comes to editing, there is greater overlap, but the two companies have historically approached video editing from opposite ends of the spectrum. While Avid has offered integrated hardware/software turnkey systems to the higher end of the video editing strata, Pinnacle, particularly through the acquisition of companies such as Miro and Truevision, championed an open-system approach that paired more affordable off-the-shelf hardware with editing software such as Adobe’s Premiere. It wasn’t until Pinnacle’s 2001 acquisition of Fast Electronics that the company had a video editing software interface to compete more directly with Avid core business.

The corporate/independent/prosumer sector of the business is most at risk from a merging of product lines. Liquid Edition is Pinnacle’s software-only product, and it arguably competes with Avid Xpress, and for less than half the price. Edition does offer a unique, all-in-one approach that allows users to author DVDs straight from the video editing timeline, and that could save it from the chopping block. With an interface that won’t be mistaken for Avid’s higher end interface, and thus presumably won’t take too much business away from it, Liquid Edition could nicely broaden Avid’s product line into a more affordable category.

However, that would be a delicate balancing act for Avid to pull off in a market sector that has historically been an enigma to a company whose bread and butter is the higher end. Pinnacle’s hardware/software Liquid bundles-Liquid Blue and Liquid Chrome-present an even trickier challenge if they are to remain viable in a product portfolio that already includes Avid Xpress Studio and Media Composer Adrenaline. It’s probably more likely that those technologies will get folded into Avid’s current products.

The most intriguing piece of this new Avid-Pinnacle picture may be a product that today’s content creation professionals will probably never use: Pinnacle’s consumer-oriented Studio editing software. Today, Studio dominates the Windows-based consumer editing space and will immediately give Avid both a strong reputation and established distribution and sales channels that Avid can adopt without much change. And, as with the reclamation of the Sports Division, Studio should immediately yield Avid revenue.

In the longer term, Studio could be critical to establishing the Avid brand among aspiring video professionals. Attracting consumers while they are young has a well-documented strategy for two of Avid’s biggest competitors moving forward. Sony’s My First Sony campaign put the trusted Sony brand in the hands and minds of young people, some of whom grow into Sony broadcast and editing products. Apple’s iMovie and iDVD also allow young people their first taste of success working with video. And Apple’s Final Cut Express and professional Final Cut Pro are logical stepping stones for maturing videomakers.

Over the years, one of Pinnacle’s main strengths has come in its ability to share technologies across its entire product line. For example, Pinnacle mimicked the easy-to-use Studio interface when it built the Vortex editor for fast-paced newsrooms. And it put professional Deko titling technology in Studio in order to give consumers the good-looking titles they’d expect from television. Avid’s acquisition of Pinnacle gives it as broad a product line as it’s ever had and the ability to share technology across its products. If it can pull it off, that could make the new Avid very exciting to watch.

Jeff Sauer is a contributing editor of Computer Graphics World and director of the Digital Video Group, an independent research and testing organization for digital media. He can be reached at