Three things you should know about Audinate’s strategy

When a high-profile company operating in the AV market announces plans to raise a total of A$70m in funds, it obviously invites speculation as to how the money will be used.

This is the case with Audinate, the company behind Dante and Dante AV, which made just such an announcement via the Australian Stock Exchange last month.

In its Stock Exchange statement, the company said the funds would be available for organic growth and for bolt-on merger and acquisition opportunities. Shortly after this, we caught up with Audinate’s chief marketing officer, Joshua Rush, and asked what it all means for an AV audience.

“The real idea behind it is to help us go faster with our strategy,” says Rush, speaking at the IBC trade show.

This is a strategy that has three legs: developing the core audio business, the newer video business, and new control and management tools.

While the widespread uptake of Dante is well-known, and different flavours of Dante AV are starting to make their mark, the company’s ambitions for control and management are maybe less well known. So this is an area Audinate devoted resources to at IBC.

Here it showed Dante Connect, a could-based connectivity solution for Dante. “Where Dante used to work on a local area network, for managing a room or a building, we’ve now taken that to the cloud, so you can manage your content network anywhere in the world, using one of the cloud service providers,” Rush says.

Currently, Dante Connect is primarily aimed at IBC’s traditional audience, such as tier-one broadcasters, but the aim is that eventually any Dante user will benefit from being able to access their devices in this way.

In addition to this, Audinate is currently dabbling with AI and wants to go faster in this area of technology too. “As part of that control and management layer, we sit on top of a lot of data that is flowing through a Dante network,” Rush says.

This information is about devices and the network itself. “We do a lot of analytics on it today but it’s all relatively static,” he says. So a user might get notifications about a device going offline or coming back on.

“We want to add AI into the mix and provide more predictive analytics for our customers. So instead of having to react to something that has already happened and quickly go and fix it, they would be alerted to something before it actually occurs so they could intervene,” says Rush.

That way the AV system continues to operate smoothly and doesn’t have health issues or outages.

After looking at the big picture, it is time to turn to each of the three legs of the strategy, one by one. First, there is another big announcement that Audinate made last month: the news that it has shipped a record one million units of Dante in a single year.

Just three years ago that figure was half a million, and last year it was around 800,000. “That just speaks to the fact that there is increased demand for Dante and the products that Dante is embedded in,” Rush says.

But there is another element to this growth. The million-unit figure doesn’t just include audio, but also video and software. In fact, software accounted for 44% of the million units sold.

What about the take-up of Dante AV? The number of manufacturers that have licensed Dante AV has now reached 40 and there are many dozens of products that customers can buy right now.

“Obviously, there’s a lag from when a manufacturer signs to when a product comes out to market. Many of those OEMs are still in the development process, so there’s a lot more that’s in the works that is making its way to the market,” Rush says.

What customers want is for Dante to do for video what it has done for audio, Rush adds. This is to provide an interoperability layer, which means that no matter the manufacturer, they can just plug a product into a Dante port, it will show up in their software and it can be managed in one place.

It’s perhaps no surprise that the third leg of Audinate’s strategy – control and management – is currently focused on big broadcasting organisations. “The control and management tools that we’ve talked about become increasingly important in broadcast because once you get hundreds, if not thousands, of devices you need a very logical way to manage and group them,” says Rush. “It’s certainly not the same as having a small-scale house of worship system or something like that.”

To give an idea of the scale of network you can have in broadcasting, at the end of last year, Audinate announced that the NFL’s media headquarters had deployed the world’s largest Dante audio network with nearly 18,000 Dante audio network connections.

But Audinate already has control and management software for smaller organisations in beta. And the goal is to launch the company’s first foray into this area of the market in its current fiscal year which ends in June 2024.

Finally, there is the question of whether the supply chain difficulties are now a thing of the past. “You never want to say never,” says Rush, “but for the most part I would say it is all behind us.”

The question comes up because Audinate had an interesting three-pronged approach to helping customers through these difficulties. One step was to negotiate on behalf of its partners to get a bigger allocation of chips. A second step was to introduce new products to replace ones whose production was constrained. And the third prong was to encourage a move to software, a development we reported on at InfoComm last year.

“We’ve had success with all of those,” Rush says. “It varied by customer in terms of which path made the most sense for them but it all helped.”

So, chip companies have more availability and some customers may have migrated to more future-proof approaches. But it is the shift to software, which was under way before the pandemic, which is still noticeable, in the market and in Audinate’s own sales chart.

You only have to look around at the IBC trade show where we are talking. “If you just walk the show floor, a big theme of the show is this move toward software,” says Rush. “So software Dante fits right in with that strategy.”