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Video services

SeaChange Back in a Buying Mood

After selling off some non-core businesses, SeaChange International Inc. (Nasdaq: SEAC) got back into buying mode on Tuesday with the acquisition of Flashlight Engineering and Consulting LLC, a firm that develops software for digital TVs, set-top boxes and mobile devices.

The financials weren't disclosed, but the pairing seems to fit with SeaChange's new focus on becoming a pure-play software company after shedding its broadcast server and video-on-demand content aggregation businesses in recent weeks.

Flashlight and SeaChange aren't strangers, as they've worked on several joint projects involving cable operators. Flashlight, founded in February 2007, has primarily been focused on developing software for set-tops, but has also expanded its work to include smartphones and other types of connected, multi-screen video devices. As cable goes, it's done work on the tru2way middleware stack and Enhanced TV Binary Interchange Format (EBIF) user agents, which are used for interactive apps that can run on just about any class of digital cable set-top box. Its cable operator customers include Comcast Corp. (Nasdaq: CMCSA, CMCSK), Charter Communications Inc. , Cox Communications Inc. and Time Warner Cable Inc. (NYSE: TWC).

SeaChange said it will keep Flashlight based in Portland, Ore., as a new business unit, and will retain the vendor's 20 employees. Among them, Flashlight President and CEO Eric Miller was named VP of engineering, reporting to Shiva Patibanda, GM of SeaChange's In-Home business unit.

Why this matters
It's another indication that the worst may indeed be behind SeaChange as it moves past a big executive shakeout and slims down a product portfolio that's led off by Adrenalin, its multi-screen back-office platform; advanced advertising systems; and software and navigation systems for set-tops, gateways and connected devices.

And Flashlight might be just the start of additional small acquisitions for SeaChange now that it has some extra cash in the bank following recent asset sales. New CEO Raghu Rau told Light Reading Cable in May that SeaChange would be on the lookout for "tuck-in" acquisitions that suit the company's revised product strategy and its pursuit of adjacent markets such as mobile and IPTV. (See SeaChange's Interim CEO Goes Permanent.)

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— Jeff Baumgartner, Site Editor, Light Reading Cable

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