Avid 2008 Annual Report Download - page 6

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1
PART I
ITEM 1. BUSINESS
OVERVIEW
We are a leading provider of digital media content-creation solutions for film, video, audio and broadcast professionals,
as well as artists and home enthusiasts. Our mission is to inspire passion, unleash creativity and enable our customers to
realize their dreams in a digital world. Anyone who enjoys movies, television or music has almost certainly experienced
the work of content creators who use our solutions to bring their creative visions to life. Around the globe, feature films,
primetime television shows, commercials and chart-topping music hits are made using one or more of our solutions.
We have been honored over time for our technological innovation with twelve Emmy awards, one Grammy award
and two Oscar statuettes: the 1998 Scientific and Technical Award for the concept, design and engineering of our
Avid Film Composer system for motion picture editing, and the 2003 Scientific and Technical Award for the design,
development and implementation of our Pro Tools digital audio workstation. Although we take pride in the honors
bestowed upon us, greater satisfaction comes from awards given to our customers for the films, music and television
shows they create using our solutions. The 2009 awards season has marked tremendous success for our customers
across the music, film and television industries – with more than 55 honorees and 140 nominations representing several
categories for 2009 Grammy, A.C.E. and Oscar awards. At the 81st Annual Academy Awards, winners in the Best
Motion Picture, Sound Editing, Sound Mixing, Film Editing and Music (Song and Score) categories were all created
with a variety of Avid audio and video solutions. As has been the case in the past, our Avid Media Composer system
was the common tool of choice for the majority of 2009 A.C.E. Eddie nominees and winners in every category at the
59th Annual A.C.E. Eddie awards. Similarly, many of this year’s Grammy award-winning songs, artists and albums
relied on our Digidesign Pro Tools platform in their creative production process.
BUSINESS TRANSFORMATION
We have customers throughout the world who rely on us to develop products tailored to their unique needs and
requirements that will allow their businesses to succeed. For their long-term success and our own, we committed in
2008 to becoming a more efficient, innovative and customer-centric company. We initiated a significant transformation
of our business that included, among other things, establishing a new management team, developing a new corporate
strategy, reorganizing our internal structure, improving operational efficiencies, divesting non-core product lines and
reducing the size of our workforce. We have established a strategic and organizational foundation from which we are
positioned to build momentum in our core business and expand our operating margins with the ultimate goal of
sustainable profitable growth.
The presentation of our business in this annual report on Form 10-K generally reflects changes made to our business as
part of our transformation efforts, except with respect to certain aspects of our financial reporting. We have traditionally
operated our company as three business units, Professional Video, Audio and Consumer Video, with each
corresponding to a reportable segment. As part of our transformation, we transitioned to a new business unit and
reporting model on January 1, 2009. This new model, which includes a single customer-facing organization, better
aligns us with the realities of many of our customers who either depend on, or would benefit from, an integrated
solution that encompasses multiple Avid product and brand families. It also enables us to leverage our deep domain
expertise, brand recognition and technology synergies across customer market segments. Although this transition
represents a significant change to the way we operate our business, because we did not fully implement it until the
beginning of 2009, we are reporting our financial results in this annual report with reference to our three traditional
reportable segments to reflect the way we operated in 2008. Our full assessment of the reporting model to be used
starting in 2009 is not yet complete.