Perspectives on AVI-SPL’s Anderson Audio Visual Acquisition
Dec 02, 2016
This week AVI-SPL announced it acquired Anderson Audio Visual. Terms of the deal were not disclosed. The move enhances AVI-SPL’s position as the top revenue generator on AVNetwork’s 2015 Top 50 Systems Integrators list with the addition of Anderson Audio Visual, currently in the 17th spot.
Frost & Sullivan’s Connected Work research team spoke with the CEOs from both companies to learn what there is to know beyond the press release. We came away from those conversations largely satisfied with the answers to our questions, and we are ultimately positive on the acquisition. The addition of Anderson Audio Visual underscores part of AVI-SPL’s relationship with H.I.G. Capital that aims to “expand AVI-SPL’s resources and capabilities to widen its gap as the leading total solutions provider for workspaces around the world”.
Here is some of what we learned that is not in the press release.
- Anderson Audio Visual has 160 employees, which are expected to be maintained and integrated into the AVI-SPL organization of 1,500 current employees.
- Although the two have competed for years, including within the same territories, there is little overlap in the customer bases of both companies.
- AVI-SPL lacked the strong presence it needed on the US West Coast. Anderson fills the gaps with offices in the Bay Area, Irvine, San Diego, and Sacramento that complement the AVI-SPL offices in Los Angeles and San Francisco. Anderson’s staff and assets in Charlotte bolster AVI-SPL’s previously small team in the Queen City. Anderson’s assets in the Dallas, TX area likewise strengthen AVI-SPL’s capabilities in America’s #10 Best Place for Business and Careers and #12 in job growth, according to Forbes.
There is some overlap across the two companies’ services portfolios, primarily in the areas of AV integration, maintenance and managed services. However, this is not seen purely as a negative. Frost & Sullivan forecasts a healthy 12% CAGR for managed and private cloud video conferencing services revenue growth over the next five years, per Frost & Sullivan, so strengthen for this opportunity makes sense. The combined company also gains distinct elements from both sides of the acquisition.
- Anderson maintains commercial security and data services businesses which AVI-SPL does not possess. While these Anderson businesses are primarily targeted at California markets there is potential for them to become a greater emphasis and more broadly rolled out by AVI-SPL.
- Anderson has partnered for the traditional hosted bridging services it delivered to its customers. With the merger AVI-SPL’s traditional hosted video conferencing infrastructure, cloud video conferencing infrastructure and innovative Symphony platform offer a wealth of new services capabilities available to the existing Anderson customer base and long-term growth opportunities for the combined company.
- AVI-SPL has a relationship with Microsoft and technical expertise in Microsoft solutions that Anderson did not possess, aside from products such as Surface Hub. Again AVI-SPL gains new sales opportunities while the Anderson customer base will win with new services and solutions opportunities through the acquiring company.
Beyond opportunities within the Anderson customer base, one concern of ours is that the acquisition brings few assets to immediately enhance AVI-SPL’s Unify ME video conferencing as a service (VCaaS) business. Although competitive, an injection of more resources may have helped differentiate Unify ME further. While still a nascent market, VCaaS is among the fastest growing segments of the collaboration industry with a five-year revenue CAGR of 22%. Expertise in Microsoft unified communications and collaboration solutions is likewise an area where Anderson offers long-term potential, but few incoming assets to immediately bolster AVI-SPL’s Microsoft expertise and solutions set.
This acquisition may not grab headlines outside of the audio/video sectors of the collaboration market, yet it is a good move for both companies. Anderson customers certainly will take notice as they stand to benefit the most from a range of new solutions and services available to them. Existing and prospective AVI-SPL accounts will also benefit from an improved support footprint. Finally, the combined company ultimately benefits from a larger customer base, a larger workforce of industry experts as well as growing breadth and depth of complimentary audio, video, data and security solutions.
Sixteen + years of experience in enterprise communications markets. Particular expertise in: Competitive and market intelligence, Market trend analysis and forecasting, Solutions development, marketing, sales and service support strategies.