Avid 1998 Annual Report Download - page 2

To Our Shareholders
Three years ago, all of us at Avid set out to rebuild the promise of our company. Today,
we are well along in that effort and 1998 marked another year of significant progress.
I am particularly pleased to point to this past year’s new product introductions. There
were seventeen of them in all, the most in Avid’s history, and their nature outshines their
number. These are not just the next generation of pre-existing products, but the introduc-
tion of new platforms that we have been working toward to open up new market opportu-
nities and fuel future growth.
Growth is our main priority for 1999 and beyond. We have targeted four key markets
which are today dominated by linear or special processing solutions that are ready to
be replaced with new non-linear technology. These are:
|Television Finishing
|Broadcast News
|Corporate/Industrial Video
|Audio Production
We estimate the total size of these markets to be approximately $4-6 billion. Several
key products, which were introduced in the latter part of 1998, are instrumental in
opening up these four vital markets and driving Avid’s future growth. These include:
Avid Symphony, Marquee (3D Titling), and SOFTIMAGE|DS 2.1, targeted to the tape-
dominated television finishing market; NewsCutter DV for the broadcast news market;
Avid Cinema for Windows and Avid Xpress for Windows NT for the corporate/industrial
video market; and ProControl and Pro Tools|24 Mix which now make Digidesign Pro Tools
a compelling choice for the entire music production process.
Last summer, we took a major step in building our future with the acquisition of
Softimage Inc. from Microsoft Corporation. With it, we acquired one of the world’s
leading 3D animation software products, a very strong new high-end production system
called SOFTIMAGE|DS, several years of development work on a next generation archi-
tecture, and a group of amazingly talented people. We are excited about the results so
far. SOFTIMAGE|DS sold a record number of systems of its type in its first year. The
revolutionary next generation 3D application, internally named “ Sumatra,” is slated for
introduction late in 1999. We are now in the process of developing a range of products
to take advantage of our combined strengths.
To penetrate the broadcast news market, we formed an alliance with Tektronix, Inc. This
includes a joint venture focusing on development of the next generation newsroom com-
puter systems, a distribution agreement for Tektronix to sell our products in many major
broadcast markets around the world, and technical cooperation to make our respective
products work together easily.
Near-term, we continue to focus on the significant opportunities in professional media.
Additionally, we believe the future will bring greatly expanded opportunities for Avid in
the consumer and business markets, where the use of media for presentations, corporate
communications, training, interactive entertainment and a host of consumer and com-
mercial purposes is only a few years away. In 1998, we introduced new versions of Avid
Cinema which have received favorable reviews, and we are developing office-oriented
products, Internet media approaches, and infrastructure capabilities that will be needed
to take advantage of media in home and office environments.
On February 27, 1999, Avid was honored
at the Scientific and Technical Academy
Awards®at the Regent Beverly Wilshire
Hotel in Beverly Hills, CA when the
company received an Oscar®statuette
for the concept, system design and
engineering of the Avid Film Composer
system for motion picture editing. Avid
Chairman and CEO Bill Miller accepted
the award on stage on behalf of all of the
employees of Avid.
Courtesy A.M.P.A.S