Avid 2008 Annual Report Download - page 2

Gary G. Greenfield
Chairman and
Chief Executive Officer
To our shareholders
Since arriving at Avid, I have spent a great deal of time evaluating the state of our business and have met with
hundreds of customers – from award-winning production teams to creative individuals who are making
music and movies at home. The most common themes that emerged in these conversations were that
our customers genuinely care about Avid, but also feel like we could do a better job of understanding their
everyday challenges and developing solutions to meet their needs. Our balance sheet was strong, and
remains so today, with both a healthy cash position and no debt. However, in order to keep pace with the
changing needs of our customers and to grow our position as a leading provider of solutions for the media
industry, it was clear that we needed to make changes to the way we were doing business.
Historically, Avid has represented a family of separate businesses that served our video and audio
customers independently of one another. While we were focused on serving the needs of customers
engaged in digital media content creation, we did not take full advantage of our incredibly strong domain
expertise or the strengths of our combined brands to deliver the solutions our customers needed.
In July 2008, we introduced a new corporate strategy to help us transform Avid into a more customer-
focused, innovative and efficient company. The first steps in this transformation were establishing a single
customer-facing organization structure and aligning our new management team to the organization. At the
same time, we implemented a new customer market segment strategy and a formalized customer listening
program – our Customer Advisory Boards – to gather new insights about the requirements of our customers
across the consumer-to-enterprise continuum. I am pleased to report that we are already delivering
product advancements to meet these requirements. We launched a new video editing line-up that offers
professional customers greater performance, quality and value. We introduced a more efficient, open and
intuitive version of our award-winning audio creation and production system – Pro Tools® 8. Similarly, the
latest release of our consumer video editing software responds to customer requests by giving customers
access to more robust compositing and animation effects along with advanced audio capabilities.
Importantly, we introduced interoperability between our leading professional video editor, Media Composer®
and Pro Tools, to provide customers with an integrated experience. In addition, we streamlined our product
portfolio in 2008, divesting product lines that no longer presented a strategic fit to our core video and audio
markets. More recently, we also initiated steps to advance the competitiveness of our offerings, ensuring that
our solutions are focused on our customer requirements.
In this past year, changes to the global economic climate created a business environment that was filled
with challenges, but also presented opportunities. One area of change we are watching closely is the large-
scale dynamics affecting our broadcast customers. The way broadcasters create and distribute content is
evolving due to the splintering of audiences and introduction of new content distribution platforms. These
dynamics require new business and revenue models that demand greater cost reduction and improved
return on investment. We see a significant opportunity for Avid to partner with these customers, enabling
them to navigate their own business transformations with the operational agility they need to achieve long-
term success.
As we move forward, we are looking to take our business transformation to the next level by leveraging the
collective strength of all our brands. This, combined with our customer-centric business model, is allowing
us to focus on our core strengths. Our goals are to get healthy, build momentum and unlock new sources of
growth. If we do all these things, we will not only help our customers to realize their dreams in a digital world,
but we will also be better positioned for future market opportunities and better able to deliver greater value
to our shareholders.
Sincerely,