Harmonic Inc’s planned $274 million (€215m) acquisition of media server specialist Omeneon is likely to be the prelude to further deals, according to a new report from Strategy Analytics and D.I.S Consulting.
The report, Harmonic Acquires Omneon: Impact, Challenges and Next Steps, also suggests that further deals could be on the way from Harmonic as it seeks to add further capabilities.
“Regardless of Harmonic’s clear leadership position in encoding, they could have still been viewed pretty narrowly as a solutions provider for only a relatively small slice of the broadcast and professional work flow,” says Douglas I. Sheer, chief analyst at D. I. S Consulting. “With the addition of Omneon, they are able to greatly broaden their solutions offerings in a very harmonious way, that builds on their already established strengths in the post-production part of their customers’ operations.”
Sheer’s report suggests that in spite of the strong synergies there will still be challenges for the new venture, around issues such as pricing, labour and customer expectations, but the strong financial performance of both players suggests they will continue to play a leading role in the wider industry consolidation expected as market recovery continues.
In its first quarter financials last week, Harmonic reported net sales of $84.8 million, up 25% from $67.8 million in the first quarter of 2009. While US cable proved particularly strong, international sales reached 50% of net sales for the first time.