In this article, Tim Wilson begins his series on the big news already beginning to leak from IBC 2009. Blackmagic Design has acquired da Vinci Systems and yes, you read that right. BMD owns and will be developing and marketing da Vinci's award-winning colorgrading technology. What's in store? Here's Part One of Tim's look at the fast-breaking news...
While the news is just beginning to trickle out, the story appears to be one of the biggest that our industry has seen in years: that Blackmagic Design has bought da Vinci Systems, the company whose name is synonymous with high-end color finishing.
We have a number of stories rolling out very quickly, but let’s start at the beginning. Blackmagic Design’s founder Grant Petty’s first job in this industry was as a telecine engineer, working with da Vinci products. He was absolutely amazed by the beauty of the pictures it made, an impression that has stayed with him as he helped create some of the most pivotal early products for SDI I/O for desktop computers. It has also driven the creation of high-quaility converters, the new UltraScope – very specifically designed around his experience with telecine scopes – and a new line of infrastructure-oriented products such as Broadcast Videohub.
Another part of Blackmagic Design’s company is post production, through a studio in Singapore. They are Asia’’s most advanced and Singapore’s only digital intermediate facility. They’re loaded for bear, too: film, 4K, DPX, the only Truelight-calibrated post facility in Singapore, a 30 workstation SAN, etc. etc. and a daVinci Resolve system with the Impressario grading system for realtime 2D and stereoscopic 3D finishing. Click here for more information
(As you would expect, Blackmagic’s post facility has the goods too.)
As is the way in every aspect of production, using every kind of product, they found themselves looking for new features for the two da Vinci systems they bought. “It was through these conversations that we learned that da Vinci was for sale,” says Grant. He saw the opportunity to now shape the brand that had in its own way helped shape him, and didn’t miss the chance.
Some problems quickly became apparent. First, da Vinci’s development efforts had become focused on 2K products. The company had dismissed engineers who had previously been working on next-generation products for 4K and above. This was exactly the opposite of Blackmagic’s view of the world, so they acted accordingly: “engineers working on products that had no future” were let go. Fired engineers who had previously been working on next-gen products have been rehired, and the team will be growing 3-4 times larger over the next few months.
This represents a major change in direction for the company – one which we think you’ll agree is the right one, and well overdue.
Whatever else Blackmagic is known for, the company is known for significantly disrupting price/performance ratios, a practice that Grant had set in motion even before coming to Blackmagic. So the obvious question is, will buying da Vinci create the opportunity to slash prices?
For now, it appears that the answer is no. Much of the expense of da Vinci products stems from the research, development and manufacturing of the hardware that drives real-time performance for advanced operations with full-scale, high-resolution files. Those prices don’t go away.
There are two immediate prospects for lower prices. The first of these is getting rid of support contracts. While the company will continue to honor all existing contracts, they will not be signing new ones. We were floored by this part of Grant’s email:
I have never really heard of anyone who has used the cost of the support contract in failed boards, and I think it’s a waste of money. Products are just not that faulty to justify such a high support contract fee.
Have you ever heard another company ever say anything like this? Many companies rely on service contracts as profit centers, sometimes their ONLY profit centers. Says Grant of da Vinci, "Our products are reliable enough that you don’t need a support contract – and in fact, we can’t justify asking you to pay for one." Amazing.
Equally amazing: Grant’s email says that they will encourage the purchase of second-hand systems! There is lots of good second-hand equipment on the market, and we can help keep its resale value. They also feel that there is more than enough inventory to provide spare parts as needed--which will be rarely enough that the company will be able to support second-hand systems effectively, even while eliminating service contracts.
These are, in their own way, dramatic commitments to keep prices down, and to disrupt standard industry practice.
To discuss this news, please visit our new DaVinci forum, or see our Blackmagic Design forum, or visit our Apple Color and Apple Final Cut forums.