Editor’s note: IBM’s acquisition of Georgia video technology firm Clearleap is part of Big Blue’s strategy to build ways to monetize video, writes Technology Business Research analyst Cassandra Mooshian.
HAMPTON, N.H. – Television and video are rapidly shifting from traditional, linear programming formats to IP-based on-demand applications. By acquiring Clearleap, IBM completes a content management and monetization pathway begun with its Aspera acquisition.
IBM can now ingest, manage and deliver on-demand video as over-the-top technology (OTT) distribution, as in-program advertising and as part of multi-screen syndication and distribution.
TBR believes Clearleap provides IBM’s Media and Entertainment group with high value infrastructure and services to win business from cable providers and media conglomerates seeking digital transformation. Further, the move enables clients currently working with IBM who are born-on-the-cloud advertisers to expand their video footprints against traditional television market leaders.
Meanwhile, IBM’s Bluemix development platform gains new video capabilities to support developers who are writing the next generation of video-enabled applications for entertainment, education, social interaction and government.
On December 8, 2015, IBM announced the acquisition of Clearleap Inc., an Atlanta-based privately held company that delivers a multiscreen digital content delivery platform following its 2013 acquisition of video-centric data transfer vendor Aspera. Clearleap is a platform play and will be integrated into IBM’s Cloud business under GM Jim Comfort.
TBR estimates Clearleap is a $25 million annual business and that the acquisition price was between $200-$250 million.
IBM is sharpening its cloud focus on hybrid cloud and hybrid IT enablement as core areas of the legacy IBM business continue to decline, pursuing enterprise customers seeking secure and integrated IT solutions with value-added services availability. Clearleap currently delivers its cloud-based platform from its own facilities in Atlanta, Las Vegas, Amsterdam and Frankfurt and will quickly be brought to IBM’s global scale via its global SoftLayer data centers, allowing the joint IBM Clearleap capabilities to be brought worldwide.
Prior to this announcement, Clearleap had presence in Europe and North America and will now seek to quickly expand into APAC via IBM Cloud. Some of Clearleap’s largest customers include HBO, TWC and Verizon, many of which IBM already both partners and competes with, promoting both coopetition and vendor agnosticism, ultimately allowing customers more choice for their multivendor solutions.
Winning business with a new generation of video via cloud, digital and analytics
While IBM will continue to nurture the relationships Clearleap has in media and entertainment, we believe its most dominant long term goal of this acquisition is to bring these capabilities at scale into other applications such as personalized education and healthcare. In both industries, there is a growing desire to collaborate via video and streaming content – we’ve already seen this with Watson from IBM, with its ability to use images and videos to analyze and make diagnoses.
Next steps for IBM will be to acquire or build up its ecosystem of ad tech vendors to bring programmatic services into the Bluemix platform. Since next-gen video will be personalized and on-demand – and likely will be customized based on location, context, role and device – IBM sees a huge opportunity to add cognitive capabilities, attribution data, analytics and relationship tracking software to what used to be a passive process.
They are not alone, as digital natives such as Google and Facebook are expanding capabilities of their multi-faceted platforms which deliver a combination of ad revenue and audience extension for content owners. The traditional media giants will not take the threat passively, and TBR believes IBM’s platform play may make them more friends than enemies as they seek to enable, but not deliver, next-gen video.
(C) TBR
