With the market for Internet video exploding, so to is the market opportunity for companies providing back-end enabling technologies, notably encoding/transcoding and distribution/streaming services. Investors are taking note.
One of the players, Utah-based Move Networks has just raised an additional $34m in a Series B financing. The Reg D securities filing was dated September 24. According to PE Hub (which has first-look access to the public record document thanks to parent company Thompson Financial’s service relationship with the SEC) prior investor Steamboat Ventures appears to have led the round. (Steamboat Ventures, which is named after the Mickey Mouse character Steamboat Willy, is the Walt Disney Company’s venture capital arm).
While still small, and somewhat off the radar to those not following the industry, the company has been creating a name for themselves as a partner in the encoding and streaming of professional feature length content, notably Internet on-demand TV rebroadcasts. They first made waves by signing ABC who chose Move’s technology over more popular Adobe Flash based competitors. In early August, they scored another coup by signing Discovery Communications, operator of popular cable franchises Discovery Channel, The Learning Channel, Animal Planet and others.
Move Networks also provides technology for ESPN’s 360 Internet offering though that is less notable given Move’s strong Disney affiliation. (Steamboat Ventures is Disney’s venture arm. ABC, already a partner, and ESPN, are both Disney properties).
The marketplace for digitization and streaming platforms is richly competitive with a host of varied solutions for potential customers to choose from. Hardware like the newly launched Ripcode network appliance and public vendors like On2 Technologies (AMEX:ONT) all provide services in the space. Depending on how the market develops, many of these companies could be complimentary or competitive. Ripcode’s transcoding hardware, for instance, could be a valuable partner if bundled with Move’s streaming services. Sold independently, however, they could battle each other as competing solutions for transcoding video content.
With substantially increased capital reserves to cover an increasing burn rate, Move Networks should be a little better positioned to continue their expansion.