CEO Conversations: Peter Csathy, Sorenson Media - Part Two

In part two of this CEO Conversations with Peter Csathy, we talk more about how Sorenson Media differentiates itself within the market and Peter offers his mid-year review of the online video space. We also talk about how in the midst of the economic recession his company continues to grow and hire more positions. Earlier this month, Sorenson Media reported that the number of international visitors to its Web site now exceeds domestic traffic as a result of the demand for the company’s digital video solutions. International sales are up and Peter attributed that to "a direct result of our established brand name and reputation for quality,” adding that, “It is also a testament to how important online video is becoming to businesses globally.”

In part one, Peter described their offering as the portfolio approach where you have the products and services. While they have the video publishing platform of Sorenson 360, they also have the separate encoding solution, Sorenson Squeeze which can work seamlessly together or completely independently. 

Here's an overview video, Video Publishing Made Easy | Sorenson Squeeze + 360:

Here's the conclusion of our conversation:

Larry Kless: Last month Sorenson Media issued a press release that said, Sorenson Media Plans Further Expansion to Meet Growing Demand for Innovative Online Video Services, can you speak to that statement and further expand upon what you've been quoted there?

Peter Csathy: So, the exciting thing about this space, when we talk about the macro environment is that it's crazy economic times. It's very painful out there and we all know that. At the same time, we in the online or Internet video space who provide the toolsets (and there are a number of companies), all of us are very good position because the market for our kinds of services and technology is growing literally exponentially. So these are good times for our company.

And as a result, you see hiring going on with other companies that are in and around the space rather than retrenchment. We've already done significant hiring since I've come on board and we're continuing to do that. So we have a number of job reqs right now and we're about to announce some very important hires very soon for both the San Diego office and the Salt Lake office. The reason being is this massive opportunity that we're extremely bullish on and we're already capitalizing on. But this is just the beginning, we believe in what I'd like to say, the second inning of a nine inning game.

Larry Kless: Pete Wylie just gave us a mid-year review, and Will Richmond how much funding there's been in the online video space  this year. So there's no question that there's continued innovation and continued funding. Based on that, what's your mid-year review and where do you see the industry is going and where Sorenson Media has gone and will boldy go?

Peter Csathy: Well, let's talk about the industry first, and this gets back to the discussion we've already had. There's a tremendous opportunity in any two of a nine inning game. That's where we are. As pervasive as Internet video is today this is only the beginning haven't seen any yet. Nobody's denied that there's this opportunity that's significant, and there will be plenty of room for many winners in that space.

Having said that, as a mid-year review, you see almost on a weekly basis a new entrant coming into the space. Let's face it, there are a lot of challenges for the breakout players within the universe of companies that are now trying to compete in that space. So the reality is, especially during tough economic times, that there will be a lot of shuttering of doors in many of the various participants who are trying to be winners in the space. You've already seen that with a number of companies including some that have been funded by some very big names that have come and gone. That doesn't mean the overall market opportunity is going away. It just means that you need to have a compelling reason to for customers to come to you and use your service. You need to be differentiated.

When we look at our company and where we fit into the ecosystem, I've mentioned some of these points already, we're uniquely situated in many different ways. So I won't repeat them all, but from a funding perspective we don't face the challenges that most others do. We've been around for fourteen years, we have a portfolio of services with multiple revenue streams. We have our Spark licensing business, our Squeeze sales business and our subscription SaaS (Software as a Service) business, Sorenson 360. We've been profitable for a number of years and we have a very healthy balance sheet. So we don't need to go out to the external world and raise money.

We're in very fortunate position where we're a successful stand-alone business and we're positioned well. We have a strong brand and we know who we're trying to meet the needs of, and we're not trying to be everything to everybody. We're looking at solving the problem and providing solutions to the video professionals until that space grows itself exponentially. We believe that we're positioned to be a winner in that space.

Now just a final thought, that doesn't mean we're complacent at all. We know that there's a lot of smart people out there doing a lot of great things. We need to always stay ahead of the others and continue to innovate. We have a history of fifteen years but we need to look at each day as a brand new day and not look in the past. That's the challenge that we face as a business just like any other business. We believe we have the right team to meet that challenge and we definitely have the passion internally to make that happen.

End of this CEO Conversation.

Sorenson Media is a platinum sponsor of the Online Video Platform Summit and will be showcasing Sorenson 360 at the two-day event designed to help organizations of all types, not just those for whom video is their core business. Additionally, Peter will be speaking on a panel session at the Online Video Platform Summit which will be held on November 18-19 in conjunction with Streaming Media West in San Jose, and is designed for video publishers of all types and sizes, whether small businesses looking to publish content for the first time, independent entertainment content creators, large media organizations, or anywhere in between. 

For more updates: Sorenson Media Blog

Follow: Peter Csathy (pcsathy) on Twitter

Follow: Sorenson Media (sorensonmedia) on Twitter

CEO Conversations: Peter Csathy, Sorenson Media's Digital Media Mastermind

Since Peter Csathy took the helm of Sorenson Media as President and CEO, the 14-year old company has expanded the capabilities of its core customer base by launching an easy-to-use and cost effective video delivery network, Sorenson 360. By combining Sorenson Squeeze encoding tools with Sorenson 360, small and medium sized businesses (SMBs) and video professionals, have a dedicated workflow that extends into online video workflow. According to Dan Rayburn, EVP of Streamingmedia.com, who spent several months reviewing the product a hands on review, he said, "Sorenson Has A Winner With Their New 360 Video Platform." Dan provides a thoughtful review and gave Sorenson 360 a rating of 4.5 stars out of 5 and noted that Sorenson 360 was designed to address the needs of the SMBs and bundles all the key services including transcoding, storage, delivery, analytics, player customization all within an easy to use system.

Here's a brand new About Sorenson Media video, that makes an exclusive world premiere right here on this blog, in which Peter illustrates the key features and benefits of the Sorenson 360 video delivery network.

The following is recent conversation I had with Peter to catch up on the latest developments at his company. He also shares his perspective on monetizing of online video, the importance of high quality video encoding and what differentiates Sorenson 360 from the offerings of the many online video platform providers in the space. This is part one of the two part interview.

Larry Kless: I was just on your blog and I saw that, It's Official -- Sorenson 360 Now Features Secure Vid Review & Customizable Player Options, was that the announcement, could you explain that product launch?

Peter Csathy: Yes it was so just yesterday we introduced we significantly enhanced Soresnson 360 into the marketplace and it's a good day because the reception to date has been great couldn't ask for more.

Larry Kless: You also mentioned in your blog post that there was some critical differentiating reasons why Sorenson is in this crowded marketplace could you go into that then and then maybe talk about it but even before that what's so important about those new features?

Peter Csathy: So with respect to Sorenson 360, what we introduce yesterday there were really two primary features but from other important enhancements and we've addressed these very quickly from our initial initial launch back in May because our customers and prospective customers were really looking for these features and it surprised us that many of these were much larger groups of SMBs then we originally anticipated so that's a very good thing, and the two features that they wanted most were secure review and approval. So what we implemented is this secure password protected video. So now let's take an ad agency for example they can have their videos, they can then share them with their clients in a secure format and their clients are comfortable sharing this and they can then collaborate directly around that video in a way that makes them feel very comfortable.

So secure video with password protection was an important part of the launch yesterday. The second major enhancement is the fact that we introduced customizable players so now, as an example, video professionals and SMBs can add their own logos, they can choose the buttons and what they want on the players, the look of the players, the feel of the player and this was something that was requested very heavily from the users and prospective users. So those were the two major enhancements yesterday that quite frankly customers asked for so we listened to that and put it on the fast track in terms of development.

Larry Kless: When we've spoken in the past you described that with the launch of Sorenson 360 that you've been really in tune with your customer base and it's clear that you continue to keep in tune with them and to make enhancements based on customer demand and make it easy for them to publish a video online.

Peter Csathy: This gets back to your question about differentiation and how we look at the overall publishing market. There are a number of players and participants and it's a growing list of companies that are addressing this video publishing market and this tremendous opportunity is available to all. You know you go from companies looking to address needs of the consumer and then those who are addressing the needs of the enterprise and then there's this square in the middle where we have the SMBs, what we call the video professionals. That's our bread and butter. We know those customers, those SMBs and video professionals because we have been working with them for years and years and years. So we have an ongoing relationship with them because they've been using Squeeze for years and this is a customer base we know.

With this massive existing customer base of Squeeze users we are able to create products around them based on what they're looking for and they told us what they were looking for and that's what the genesis of Sorenson 360. The major differentiator of ours versus other players in the marketplace is that we are singularly focused on meeting the needs of the video professionals, the SMBs and we have an existing massive customer base of video professionals who are hungry for this kind of service and so we're able to provide this all-in-one one solution to them now. That's significant when you look at us versus other players in the space in that we bring quality front and center as part of Sorenson 360. And what I mean by that is that is we uniquely, I'm not aware of anybody else who does this, we uniquely can bring the power and quality of client side encoding through the equation and we bring that into Sorenson 360.

Larry Kless: Yes, because when you do all that encoding in the cloud you can't control your quality. I haven't seen any online video platform that actually publishes what their encoding specs are and actually gives you access to changing those settings.

Peter Csathy: That's right and for the video professional, the best quality is going to come from the control that they will have on the client side to adjust it precisely the way they want it. So we are able to uniquely say that Squeeze is already known as best-in-class, the gold standard when it comes to video encoding. The full power of Squeeze and client-side encoding is brought into Sorenson 360, it's brought into it in two different ways. You can have Squeeze the separate application that's seamlessly integrated into Sorenson 360, or for those who don't need that much control and power, they just want it be as easy as possible but they want the full benefits of the Squeeze client-side encoding engine. We have browser-based client-side encoding as part of Sorenson 360. So you don't need the separate Squeeze application. And it's simple drag-and-drop but it's all the power of client-side encoding so it is that control area you mentioned but it's also several other significant benefits.

So you've already compressed the file locally so when you're sending that into the cloud it's much quicker and it's done in a fraction of the time it would take it come from in front of the time that it would take using other solutions on the server side. And there are also significant cost benefits that come from that because you're not using bandwidth on the upside, just when you stream the video down so our operating costs are significantly less than other services and we can pass those savings onto our customers.

Larry Kless: Let's talk a minute about quality. I was looking at your blog post, For Video Professionals, It's the Encoding Stupid! Their Quality Content Is King, and I think about that in terms of one of your most recent posts about the video Amazon CEO Jeff Bezo just posted, Amazon's Bezos Uses YouTube to Explain Zappos Deal - But, C'mon, THAT Vid Quality? So you've been talking about how important video quality is in the value that everything we've just talked about brings to your core customer but then also to the consumer side. Could you talk about that and how high concept/low tech and poor encoding isn't always a great equation?

Peter Csathy: Yes absolutely so what your referring to is the video that Jeff Bezos and Amazon just posted yesterday on YouTube to announce a justification for the Zappos deal, and let's talk about a couple of things. It's quite a revolutionary way to do describe a business decision and you'll see much more of this. So what Bezos did of course is publish it on YouTube for the world to see because the intention was to make it as viral as possible. That's great for everybody in the online video game because that shows you the unique power of Internet video and the power ultimately come from getting massive buzz, massive distribution and making it very viral creating that kind of excitement in a way that no other forms of distribution can. That was a smart smart move by Amazon.

Now getting back to the quality issue and where quality matters. Whether you're a business that's huge like Amazon, a small medium business, video professional or consumer you still have the same goals of getting as massive distribution you want your videos to be seen by as large as a group of folks that you can and ultimately that will come down in large part to the quality of that video because without an optimal experience viewing that video you are sub-optimizing the overall distribution.

So while Amazon gets high high marks for uniquely coming up with this way of getting the word out on the Zappos announcement, it's very surprising to me and to others within our organization that the marketing team allowed the quality to be as poor as it was and in that video and because that is not getting the message across in the way that anybody would like to get across which it was the highest quality.

Larry Kless: I agree, and late last night I started a blog post about it and I looked all over the news, I checked Techmeme and the echo chamber was filled with talking about the deal but Dan Rayburn and you were the only people I saw talking about the video quality. So I saw two posts about it that commented on video and it is again, as you said too, is that it's a uniquely powerful way to use video when you've got the head of the company using video for viral marketing but the quality was extremely low, it was shot outside, there's lots of motion who knows what camera they used and it looked like it was done for $1.98.

Peter Csathy: It does look like it was done for $1.98, and the production itself, that's not the problem in fact as I commented on my blog the folksy nature of it is precisely what the marketing team wanted to do because that Amazon's shtick in the first play and it worked for them very effectively. But folksy really doesn't mean and shouldn't mean poor quality, and I'll give you a small real-world example from our own company.

When we announced the ability to view all of the videos from Sorenson 360 on an iPhone, that was a recent announcement about a month ago we shot in the course of thirty minutes of video showing the power of that just using a Flip cam, and I was outside with no special equipment at all, no special microphone just the microphone from the Flip cam. I was walking around the city of Carlsbad explaining it and if you look on our web site you can find that video and although we've done it for no money whatsoever, so for $1.98 if you will, the quality that video is pristine precisely because of the encoding and the power of the Sorenson 360 engine.



So that's the difference, low-tech in terms of production, that's the power of what all the tools that are around us. You don't need to have the heavy machinery in terms of creating great quality video but you do need the right encoding solution because that's where it comes from and that's what was lacking in Bezo's case and that's why it failed to optimize. Because look, they're trying to do what all these businesses who use online video and who understand the promise of it. They want to do is to build their businesses, monetize them better and more effectively than they have been able to date and ultimately the monetization question from online video comes down to that. For 95% of the businesses out there, it's not about ads and pre-rolls and post-rolls because they're not selling their videos themselves, they're looking to build their businesses, monetize their businesses, sell their goods and services market more effectively to the customers showcase their products much more effectively to their customers and prospective customers then they have been able to date. That's what online video does for them and that's the monetization question for them.

Larry Kless: It's a great discussion and we're looking forward to your participation in the Online Video Platform Summit in November.

Peter Csathy: Thank you, I do believe that the question of monetization of Internet video is tremendously misunderstood and proper focus isn't out there in the collective consciousness. And this gets down to what Dan Rayburn pointed out several times in what I'm pleased to say, his glowing review of Sorenson 360 and I appreciated that. As he pointed out as an example, we are not competing with a company like Brightcove. We don't see them as competitors. We’re in the same space but we're just addressing different market segments. So for our market segment, the video professionals this gets back to the point of when 95% of the businesses out there are looking to monetize their businesses not their videos themselves. They'll showcase their videos perhaps but sell their services. SMB that’s what they're trying to do, that's who we're targeting. So for these customers, we know who they are because they're Squeeze users and they told us that pre-rolls, post-rolls, that toolset is much less important to them from a prioritization standpoint the features we're talking about.

Quality, job one but all the things that we've introduced into the market yesterday for example, secure workflow, customization, all of that and so the reason why it's different gets back to the point of they're not looking to monetize the videos themselves but their services, their products her and that's the appropriate question to them in terms of monetizing online video

Larry Kless: Hear hear! (laughs)

Peter Csathy: There's a preview what I'm so passionate about and that's what I'll be discussing on the panel at the Online Video Platform Summit.

End of Part one. Stay tuned for Part Two

You can stay current on Peter's myriad of media and technology musings on his blog, Digital Media Update.

About Sorenson Media, Inc.
Sorenson Media, offers comprehensive, award-winning video solutions that empower customers to easily and affordably deploy the highest-quality video across the Internet. Included among its products and services are the Sorenson 360 Video Delivery Network (VDN); Sorenson Squeeze, the gold standard encoding application; Sorenson Squish and SquishNet, an easy-to-use browser-based video publishing platform for user-generated content; and Sorenson Spark, the industry’s most widely used video codec, which today empowers the largest selection of Internet video on mobile devices and other consumer products. From its inception in 1995, Sorenson Media has been instrumental in mainstreaming Internet video, and is committed to dramatically improving the online video experience for content creators and consumers alike.

Related:

• Digital Media Update: "Sorenson Has a Winner" With Sorenson 360 Vid Publishing, Says Dan Rayburn of StreamingMedia
• Sorenson Has A Winner With Their New 360 Video Platform (Hands-On Review) | The Business Of Online Video
• Digital Media Update: Internet Video -- Market Sizing & Research -- How Big? Already Massive & Still Very, Very Early
• Larry Kless' Weblog: Sorenson Media Redefines Online Video Publishing With 360 Video Delivery Network, "It's a Game Changer," says CEO Peter Csathy
• Larry Kless' Weblog: Sorenson Media Rebrands With Video Delivery Network, Video Publishing, Re-Imagined
• Larry Kless' Weblog: Digital Media Veteran Takes The Reins of Sorenson Media - A Conversation with Peter Csathy, President and CEO of Sorenson Media, Inc. - Part I
• Larry Kless' Weblog: A Conversation with Peter Csathy, CEO and President of Soreson Media - Part II
• Larry Kless' Weblog: A Conversation with Peter Csathy, CEO and President of Soreson Media - Part III, Sorenson Expands and More on the Future of Online Video

Updated 9/23/09: Corrections to transcribed text.

Sorenson Media Rebrands With Video Delivery Network, Video Publishing, Re-Imagined

In part two of my interview with Peter Csathy, CEO and President of Sorenson Media, we further discuss the launch of Sorenson 360 which helped rebrand his company as a video delivery network and encoding platform. Sorenson Media recently introduced an entriely new corporate identity, including a completely redesigned website and new logo -- the Sorenson "bloom" -- which as Peter says "represents the elegant blooming and organic growth of Internet video. It also represents the blooming of innovation and creativity at Sorenson Media." Just yesterday, Sorenson Media announced announced a significant expansion of their Sorenson Spark licensing program, with companies such as Qualcomm, Sony, Verizon, Ittiam and NXP Semiconductors signing on as licensing partners for its Sorenson Spark decoder enabling the full world of Internet video on mobile phones and other consumer electronic devices. Several weeks ago Verizon Wireless also licensed Sorenson Spark video technology for use in the new touch screen home phone system, the Verizon Hub.

According to Peter, "we are still in the very early innings (inning 2 of a 9 inning game) of the Internet video opportunity" and the game changes everyday.

LARRY KLESS: Where there any surprises that came up during the launch, during the announcement within the past day that kind of got you going, "Huh"? Anything in particular?

PETER CSATHY: Well, I'll tell you this; we did a press tour beforehand and so there was a lot of feedback that we had back. And I can tell you that this is not puffery, but uniformly, it was positive. The video publishing space, there are a number of players in that space already. But what everybody -- and this is what -- I shouldn't say it's surprising, but it's pretty unique that nobody that I've seen and you've seen all of the press, there's been a lot of press that came out of this. But there has not been a single reporter or blogger or analyst that I have seen that had said, "It's a crowded space and we don't understand why Sorenson's getting into it." Even when somebody says there's a space with many players in it, they immediately say, "But Sorenson has the advantages of having the reputation it does, having the customer base, et cetera, et cetera."

So the interesting thing is that I have not seen a single review or article that has been negative. It's been all very positive and, in fact, downright enthused by some. So it's been extremely gratifying. And the reason why I say that's kind of surprising is because that virtually never happens no matter how good a product is. And that's a tremendous testament to the team that we have over here because let's face it; I'm not taking credit for it.

I've been with the company for a few months now and I'm very proud of the job we've done since I've gotten here, but this is because these guys are that good. They're that good, and they're that dedicated to what they're doing. And so you can imagine how gratifying it is for all of us that it's been received so incredibly well in the marketplace.

LARRY KLESS: So in terms of all of the talk of the cloud services, open APIs. For instance, say a customer has an ad network through whatever cloud service, is it pretty seamless to plug right in?

PETER CSATHY: Yes. Absolutely. But the interesting thing about it, and you kind of hit the nail head on something that's a topic that's very misunderstood, and that's ad networks and ad serving and the importance of monetizing videos themselves directly rather than using video to monetize your business.

Remember, our target market is the Squeeze user, the prototypical Squeeze user which is the video professional and the SMB. We're not targeting the media companies like a YouTube or a Hulu, although those kinds of companies do use -- we know Hulu uses Squeeze, as an example. But we're not targeting media companies for our new Sorenson 360, although they can use us. We're targeting the video professional, the SMB. So those video professionals, they told us it's not about serving ads and monetizing the videos that way because they're not destination sites. What it is to them, it's about using internet video and their video assets to better monetize their businesses online. And this is really important. And almost nobody focuses on this critical point. For 99 percent of the businesses out there, they're not video destination sites. But businesses like you and me who want to get their video assets up there to better sell their products, market their products, showcase their products, engage with the customer, market to the customer, educate them. And that's how internet video is used. And that's how they sell more, market more effectively, create an ongoing relationship with the customer so they can market more effectively.

And I'll give you an example, like the travel industry. Travel websites now it's absolutely critical to have video on their sites to sell the services. But they're not selling the videos themselves. They don't care what's on the videos themselves. What they're selling is their resort, what it looks like, the experience so people will book. And so it's very interesting. And I think that all of the focus in the media is about the challenge of monetizing online video. But, again, that impacts one percent or less of the businesses out there. That's the Hulus, the video destinations like in the content sites like newspapers and et cetera. For everybody else, for all businesses out there, it's about making your business more effective, building your business. And internet video can do things that nothing else can. But it's not about serving ads; it's about building your business and engaging your customers more effectively.

LARRY KLESS: Absolutely. Using video, to a certain extent, like direct response.

PETER CSATHY: Absolutely right. And the thing is video -- the medium of video can do things that nothing else can. You can solve better and engage with your customers much more effectively with video than you can with text and with pictures.

LARRY KLESS: And as a note, too, the conversation we just had about monetizing video, you said so well in a previous blog post on May 6th, about it ain't about ads. I think it's so great that you have this blog.

PETER CSATHY: I just think, for me, first of all, I like doing it. Secondly, it gives me just a place where I can -- and for anybody who's interested, they can better understand where I'm coming from on some things because I would say five percent of my posts are about the business that I'm running. The last three days they have been or the last three posts have been just because we had this massive announcement and I wanted to explain it better. But absolutely, like the ad post to me is a very important one because I really do believe that the reporters are missing the point when it comes to monetization.

LARRY KLESS: I agree with you. There's been so much focus on that and it seems, too, that a lot of the coverage of the space is almost looking for like that TMZ moment.

PETER CSATHY: Yeah. That's right.

LARRY KLESS: And then correcting themselves when they got it wrong.

PETER CSATHY: Oh, and don't get me wrong. I think ads are something that's important given the context, depending on the kind of business you are. But it's certainly for the small percentage, a very small fraction of those who are using internet video.

LARRY KLESS: And then how about the corporate rebranding? And I have to say, too, I like new the logo. It's really updated. How was that process?

PETER CSATHY: I'm glad you mentioned that because you know how there's so much thought put into every little detail that you see. And this gets back to the mantra, easy is hard. So you look at the website and it's very gratifying to hear the kind of what you just said because I've got to tell you people love what they've seen in terms of our redesign. And when it gets to the logo itself, it's a long process. But immediately when it was developed, everybody liked it. Everybody liked it internally at our company. And so when it was first shown to me, I said, "I like that." It spoke to us.

And the genesis of it was our creative design had those thoughts -- he developed it based on those thoughts that I discussed in that blog post. That it means this. It means the blooming of internet video. But it's a bloom. It's ground deep in the tradition. It's rooted in the tradition of Sorenson. All of these things bubbled up in his mind and led to the creation of this logo. And so we call it the bloom. And it's interesting because when you think of -- for Sorenson Media -- for something like a 360 product, let's say you call it 360, sure you could have something that's very literal like a sphere, right?

LARRY KLESS: Yes.

PETER CSATHY: But it's an interesting non-literal logo that we've chosen for this company because it represents something much broader than that. It's those main themes that I identified.

LARRY KLESS: Yeah. I look at it and I was thinking, I mean it looks like a flower. It looks like it's opening up. So it's your designers and they really interpreted where you wanted to go with this. It's great. And then the actual site has just more of a kind of -- the colors -- wasn't the other -- it was like lots of black and lots of orange? It's a much lighter look. And I see they have a link to your blog, too. That's so cool.

PETER CSATHY: Now listen; I'm very pleased and very proud of the creative team and the entire team. They did a great job. So thanks for noticing. And I'll definitely share that with them.

LARRY KLESS: Well, Peter thanks.

PETER CSATHY: Well, I'll tell you one thing that we do here is that -- and I think you know me well enough now because we've spoken a few times -- we're a passionate bunch over here. We really believe what we say. We don't think of this as a job. We really do think that we're very fortunate to be doing what we're doing and have the opportunity to create the things that we do and the experiences that we do. So there's a true passion behind all of this. So when I'm talking to you, I really mean -- it's that kind of enthusiasm.

LARRY KLESS: Yeah, I get it.

PETER CSATHY: And it's across the board with the people here. And that's fun.

This concludes my interview with Peter Csathy. Look for more news on Sorenson Media in their press room, on Peter's blog, check out the related posts below and stay tuned for more coverage on this blog.

Related:

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• The Video Codec | Sorenson Spark
  
• Streamingmedia.com: Sorenson Introduces Sorenson 360
  
• Sorenson Boosts Squeeze 5.1's Deinterlacing Quality - Streaming Learning Center
  
• Squeeze 5.1's H.264 Encoding Quality Dramatically Improved - Streaming Learning Center
  
• Digital Media Update: Sunday, May 10, 2009
• Digital Media Update: Wednesday, May 06, 2009

Sorenson Media Redefines Online Video Publishing With 360 Video Delivery Network, "It's a Game Changer," says CEO Peter Csathy

Sorenson Media recently announced the availability of Sorenson 360, a new Internet Video Delivery Network (VDN) that makes online video publishing the highest quality, easy-to-use and affordable for video professionals and small-to medium-size businesses (SMB). The soaring popularity and growth of viewing video online is one of the biggest news stories of 2009, and according to Sorenson Media President and CEO Peter Csathy, Sorenson 360 will be "a game changer."

In my previous conversations with Peter Csathy he told me that his company -- known for nearly a decade and a half as the global leader in video encoding and compression technology -- would be expanding beyond its traditional core service into new areas and since he's taken the helm as CEO earlier this year the hits just keep on coming. Since March, Sorenson Media has made nearly a dozen announcements about the expansion of their product line including their ubiquitous Sorenson Spark codec and Sorenson Squeeze encoding application.

I spoke with Peter a few days after the Sorenson 360 announcement about their expansion into the video software-as-a-service (SaaS) space and the critical areas Sorenson 360 VDN differentiates itself from the competition. For more information on the features and pricing of Sorenson 360 online press kit is available at http://www.sorensonmedia.com/360presskit,

LARRY KLESS: So why don't we take it from the top. I was just on your blog and I noticed that it was a big news day yesterday, wasn't it?

PETER CSATHY: Oh, yeah. Yesterday was a very big news day because, of course, we introduced Sorenson 360 which we believe is a game changer. And it's interesting the feedback we've received from the trusts and analysts so far is that they agree, they understand why it is a game changer in this space. So that was exciting. And then kind of buried in there, but also very important, is the fact that we had an enhanced version of Squeeze 5 that was released. And so there are some important changes and enhancements in there that are identified in the press release. But so you now look at the overall ecosystem that we've created with Squeeze and 360, it's pretty exciting. And then let's not forget that there was one more very important thing which was the complete reworking of our corporate identity, so a completely redesigned website and logo and such. So the other thing, last night we all slept well because there wasn't much sleep up until yesterday at launch.

LARRY KLESS: So are you calling 360 video delivery network?

PETER CSATHY: Yes. We're calling Sorenson 360 a VDN, a video delivery network and the reason being that what we've done, based on the feedback from our user base, so we're not guessing -- based on the feedback of our user base is we have re-imagined what video publishing should be. And so what we mean by that is our users have told us that they want an all-in-one solution. And they didn't have that before with power encoding on the client side. And they also identified significant shortcomings with other services in the space. And based on that, we built our Sorenson 360 and it re-imagines what video publishing should be.

LARRY KLESS: So it comes out of customer demand. Is that what you would say? Or has Sorenson been working on this for some time?

PETER CSATHY: Well, it's certainly customer demand because we have this map of user base of Squeeze users and we have a continuing dialogue with them. And this is something that's bubbled up, that there is demand for this kind of an all-in-one solution that meets their needs. So that's where it came from. And we built it based on the feedback that we received in terms of what the needs are there. So our initial go to market strategy with Sorenson 360 is our existing customer base. They've asked for it and now we have a solution that we're making available to them. And that's our core. We're focusing on the core Sorenson customization for the video professionals, what we call the SMB, the small to medium businesses and video professionals.

LARRY KLESS: It seems you've been "baking it for a long, long time." As part of that, did you role this out at all to some of these core customers to get feedback along the way? Or did you have focus groups or getting to launch, how did customers give you their input into this?

PETER CSATHY: Well, for a long, long time, we've been having these -- like I said, the ongoing dialogue with our user base in terms of what kind of features you want in Squeeze. And then when you get into the dialogue of Squeeze, it naturally evolves into, "Well, we'd like to have the all-in-one solution." And we went from there. And so that's what germinated the concept of Sorenson 360. And this is something that full team, including the expanded team have been working on for a long, long time. And then you add the rebranding, the corporate redesign, it was an all encompassing lengthy process that saw the light of day yesterday. We had a significant beta program. So we had well over a thousand beta customers who were -- then they took what we initially built. They used it. They hammered on it. We got more feedback from them. We went back and changed it and revised it and updated it. And that's what ultimately saw the light of the day. So it's this product that's a great deal of focus group testing or not focus group -- beta group testing.

LARRY KLESS: Right. So basically, you gave them the features that they were asking for and then integrated into their workflow just basically to give them a solution that extends their workflow into content delivery.

PETER CSATHY: Yes, that's right. And then when we gave them kind of the straw man solution, they banged on it. We took their feedback. And then we refined it for the launch version.

LARRY KLESS: What's interesting, too, in one of our first conversations you weren't at liberty to talk about things that Sorenson was working on that was outside of your traditional area.

PETER CSATHY: Yes.

LARRY KLESS: And so how does this change the game? How is this game changing?

PETER CSATHY: Well, so first of all, we were just a piece -- we were an important piece, a critical piece of the video professionals' workflow before, but now for us as a company, we are now an all-in-one solution to all of the needs of the video professional. So rather than just being a component that's part of the workflow, now we are the go-to company for the video professional where they don't need to go and pick a service to do this piece, another service to do the other piece. They can go to one place, a trusted name, which is very, very important, a company that's been around and will be around and that's known for quality. So it's a game changer from the consumer, meaning the video professional's perspective. And it's a game changer for us as a business because it's an entirely new product category for us. But it naturally fits within what we already do. So it's just a logical extension. And this is where -- now it's not just Squeeze in isolation; it's this whole ecosystem of products where we have Sorenson 360, we have Squeeze. Squeeze naturally, seamlessly works with 360. And then we also have little known but browser based encoding, too. So the full power of Squeeze, the Squeeze engine as part of 360 is also as a browser. So you don't need to have the separate application Squeeze.

You have the browser side encoding that's just part of the 360 experience. Think of all of those elements. You have Squeeze on the client side which is the power tool. It's for the video professional who wants the upmost control. Then you have Sorenson 360, the full publishing solution, hosting solution, everything you need. And within that, you have the client-side power of Squeeze within the browser. And so for either use, if you don't need all of the power and control of Squeeze, you have this browser-based encoding as well. So you have this overall ecosystem. And then, of course, we develop this Spark on the codec licensing side.

But the major expansion of business, our product portfolio and what it means for our business, it's an entirely new product category as software as a service, recurring revenue streams, not just a one-time purchase that we had on the Squeeze side.

LARRY KLESS: Absolutely. And then in terms of the actual delivery network, are you doing what some of the other companies do just in terms of your pricing? Are you farming that out to a number of CDNs? Is that something you're running yourself? Or on the back-end, how is that working?

PETER CSATHY: On the back-end, so we put out the all-in-one solution. On the back-end, we are plugged into Amazon Web Services, so AWS. But we can fully -- the way that we've designed it, you can fully work with any CDN. So if one of our customers already has an account with an existing CDN, we can just plug into that and it works seamlessly because that's the way we've built this thing.

LARRY KLESS: I've read too, about the fact that from a quality standpoint, your video delivery network is high definition video.

PETER CSATHY: Well, absolutely. And this is a key, too. This is where we really shine among -- look, there are four major differentiators about what we call our VBN versus other video publishing platforms out there. There's four major things to think about. There is the ease of use. And we've heard that time and time again from even the press that we've received to date, ease of use. Ease of use then gets into -- and that, by the way, easy is hard. Easy is hard. That's one of my favorite mantras which is so true. And that's why the other services have not been able to do it because it's difficult to do. And we really sweat the details. The second thing is another differentiator -- the second one of the four is pricing. Fully transparent pricing. The most cost-effective. Our prices -- I want everybody to look at our prices versus other prices. Most other services, almost all of them, ask you to go to the sales team immediately. They don't even put pricing on their website.

We disagree with that. And we're fully transparent. We're no hidden charges. Check out the other services. There are setup fees that are hidden. They charge you for the uploading of the videos. So not just the streaming down but the bandwidth to upload them because and I'll give [inaudible] why that is. And then, of course, a third differentiator is we've been in the business for 14 years and the fact that we are this trusted name. We've been profitable. We are proven. Whereas every other service in our space has been around for two, three, four, five years max.

And you have to think because you're the video professional, "Am I going to entrust my video assets with a company that may or may not be here tomorrow." And that's not just an empty thing to consider because almost all of them are VC-backed companies. It's not a great time to be raising money right now. And I am not aware of any one of those companies being profitable, none of them.

So we're kind of like Allstate; you're in good hands with us at Sorenson Media. But the primary differentiator, so I saved it for last, quality, quality, quality is what ultimately matters for the video professional. It has to look as good as possible. What we do that nobody else does is client side encoding. Everybody else does server side encoding. We uniquely do client side encoding because we are the encoding expert. This gets back to the power of having Squeeze and the Squeeze heritage. Squeeze has been developed over years of time. We've always been considered to be the best in class. We have tremendous expertise in technology and a team that's built that. It's then the client that gives the video professional the control, the quality, the whistles, the bells that they need so that they can make the decisions. What formats do they want? They can make the decisions. When you're working with another one of the -- any of the other services, you send your files up to their servers; they make the decisions for you on things like output format, how they compress the files. They make the decisions for you. You don't have that control. We have the quality. We have the control that comes uniquely from the client side. And there's another substantial benefit to that; because the compression is done on the client, the file that you're sending up into the cloud is a compressed file. So it requires very little amount of bandwidth. And so we don't have to charge for that.

The reason why all of the other services charge, and it's a hidden charge for most of them, is because you're sending up the entire raw file to the servers for encoding. So that's a substantial difference. There's another important differentiator that comes from the client side. Because you've compressed and it's a compressed file, when you do upload it, it takes a fraction of the time that it does when you are uploading the raw file for the other service and their server side encoding. And if you're a video professional, that's a massive difference in terms of the user experience. So for all of those reasons, quality, time, cost and ultimately, quality, quality, quality, there really is -- we think it's game, set, match; we're the place to go.

LARRY KLESS: Slam dunk.

PETER CSATHY: You know, look, the great thing that we have is we have a substantial user base who know and trust us already. So we don't have to start from square one. We don't start at person zero or patient zero. And that's a great, great legacy to start from.

This ends part one of my two part interview with Peter Csathy. Look for part two of the interview tomorrow. Go to the Sorenson 360 web site for more information.

About Sorenson Media
Sorenson Media (www.sorensonmedia.com) offers comprehensive, award-winning video solutions that empower customers to easily and affordably deploy the highest-quality video across the Internet. Included among its products and services are the Sorenson 360 Video Delivery Network (VDN); Sorenson Squeeze, the gold standard encoding application; Sorenson Squish and SquishNet, an easy-to-use browser-based video publishing platform for user-generated content; and Sorenson Spark, the industry’s most widely used video codec, which today empowers the largest selection of Internet video on mobile devices and other consumer products. From its inception in 1995, Sorenson Media has been instrumental in mainstreaming Internet video, and is committed to dramatically improving the online video experience for content creators and consumers alike.

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A Conversation with Peter Csathy, CEO and President of Soreson Media - Part III, Sorenson Expands and More on the Future of Online Video

This is the third of a three part interview I conducted with Peter Csathy, CEO and President of Sorenson Media which took place last month shortly after Sorenson Media announced significant expansion into San Diego. In this interview Peter describes how in the midst of the current economic downturn his industry-leading digital media solutions company will open significant employment opportunities in both San Diego, which will now serve as the central hub for the company’s business operations and its existing Salt Lake City, Utah, location as it expands services and accelerates its growth in the burgeoning online video market. Sorenson Media is actively looking to significantly expand its current San Diego office location to accommodate anticipated growth. The staff is expected to triple in size within one year.

For more information about employment opportunities at Sorenson Media in both the San Diego and Salt Lake City offices, visit: http://www.sorensonmedia.com/jobs/.

Larry Kless: So this announcement is less than a week old. And what can you say about it? How did it come about, the expansion in San Diego and then also in Salt Lake? It seems you're pretty new to your position there. Has it been about a month?

Peter Csathy: Yeah. I just completed my first month. So I'm a grizzled veteran already. Well, obviously, we have this core talented team that has done great things. And so as we look to expand, which we will be doing, taking our base of what we do today and expanding it significantly. And more details of that, as I think we talked about last time, will be forthcoming in the not too distant future. But, obviously, we have to expand the team. The company hired me to aggressively expand the company in terms of build its business beyond what it is already today, and we've been profitable for years already. And to do that, of course, we need more developers. We need more on the sales side, on the marketing side. So across the board talent. And when you look at what we do, digital media, certainly Southern California is more in the heart of digital media. And so it's a natural expansion for us from a talent pool perspective but also from being near many of our important customers. And so from a geographic and just easy to serve them, there's a whole host of reasons why we're doing that. But the great thing is that it's going to be in both office locations. What we announced, of course, is the expansion. And we expect to triple our size in the San Diego office in the next year. And so that's where we are.

LK: And those positions are -- I looked over them -- from your blog, I saw that they're primarily engineering, marketing, sales and developers.

Peter Csathy: Yes. It's pretty much across the board. So we need good people across the board to augment the team that we already have today. It's a nice story in that here it is in these crazy, crazy times and everybody's doom and glooming, understandably because it's crazy out there. But we're in expansion mode.

LK: That is a great story. And so from your perspective, do you see that as a giving back to the community there? Digging in to the local talent pool? How's it been since the announcement just in terms of the reception from the community as a whole and then also just applicants?

Peter Csathy: Well, I think it's exciting. It is a nice bit of good news amid all of the doom that's out there. And so certainly we've got a lot of press in all of the biggest publications down here in San Diego. So the San Diego Union Tribune ran a story about it over the weekend. The San Diego Business Journal, a major story. So across the board, it's being received very well for that reason. And then in terms of just applicants which is critical too, we're getting a slew of applications coming in across the board as you can imagine.

We're getting talent kind of across the board in Southern California, but also we're getting a lot of in and around the Utah area as well. I haven't seen all of the resumes, but I've seen certainly a number of them. And speaking of San Diego alone, there are a lot from in and around the San Diego region. So you have Orange County. You have L.A.. You have San Diego itself proper. And they're a lot of seasoned folks. There's a lot of talent out there.

LK: How much are you going to play into making any decisions about hiring?

Peter Csathy: Well, I take a pretty active role in a number of things. Certainly, we're officially small still. Every hire, essentially, we want to have consensus because these are critical players for the team as we build this company. And so we're looking for all kinds of things. We want not only the raw talent, but you want the passion that we all have and the sense of team, really being team-oriented. And also very self-sufficient, self-starters. By the way, and all of that sounds like obvious things, but it's not easy to find.

LK: I would think so. Well, it is really a great story because, like you said, in such economic times, you don't hear about expansion. You hear about startups getting funding for a variety of different online video or having some sort of Facebook widget or this or that. But for a company like yours to aggressively expand in those areas --

Peter Csathy: And what enables us to do that, and this is a very important and interesting piece of the story for this company, is that we're not a startup. We've been around for a long time. We're a profitable business. We've been profitable for a number of years. And so we have a very healthy balance sheet. We have a very strong balance sheet. So we're a rock solid, financially strong company. And that's very unique. I shouldn't say very unique. There are some other companies out there. But it's quite unique in and around our space. It gives us the ability to now we're aggressively growing so we can do this and it's not a shot in the dark.

LK: So what's the timetable to get these positions filled and kind of move on this yet to be said expansion?

Peter Csathy: Well, what I've alluded to is going to see the light of day sooner rather than later. And I can't get more specific than that, as much as I'd like to. In terms of the hiring, you saw all the job reqs that we talked about online right now. And as soon as we have the talent, we're ready to lock-n-load. It's a top priority to this company. We want to close them. And so we're interviewing, as you could imagine, rapidly. And we need to get people in here.

LK: And then will this be phased? Is this like the first phase? Because you said you're going to triple your size.

Peter Csathy: Yes. In the San Diego office, we're looking to triple that within a year. That's the plan. And so sure, the wave that we see right now, this is what we're hiring for now. And then you go from there. I think that you'll find many of the things that we're doing interesting. There's a lot of stuff in the works. And this isn't just promising things that never come to light. There are a lot of things that are in the works as we speak.

LK: Excellent. And what have you seen since we last talked? I've checked out your blog. We've had -- just switch gears -- South by Southwest took place. Cisco announced more of their world domination plans. Just off your blog, you noted about IMDB, their plans to stream every single movie.

Peter Csathy: Yes. And that was announced at South by Southwest. Look, I think that what they're announcing, as I said in my blog, it's audacious. It's ambitious. It's beyond ambitious. Is it going to happen? Who knows if it's going to happen? But I love the fact that they're looking big. IMDB is almost this quiet company that is -- I don't know how they are from a financial standpoint, but they're a well-respected company. So that's interesting. I thought Cisco's getting further into the consumer space with the Flip, the Flip video cam, I thought that was an interesting purchase. I don't know. To me, $590 million, that was quite shocking to me. I mean that's very interesting. I don’t know what the valuation is based on. But that's a spicy meatball. I mean that's as much as News Corp paid for MySpace.

LK: And they had only raised 67 million total for their whole life of their company.

Peter Csathy: It's a nice return for the V.C.'s involved. So it's interesting to me; $590 million, I know I was talking about that before. But that's quite a price tag. What's huge is about it is that I guess for me, you're looking at the price tag and, as I said, it's what they paid for MySpace.

LK: What do you think is next just overall with online video? We previously talked about challenges, where things are going, but just in the short-term, just from where you're sitting, CEO and President of Sorenson Media.

Peter Csathy: Where does it go next? Online video, the experience itself is meant for businesses who serve it up and consumers or individuals. But it's already a significant part of people's lives. I think it's something like 2.5 hours for the average internet user who watches video. It's something like 2.5 hours of video on a monthly basis now. That's still so early. And what I see next is there are certain things like going from the capture phase of video to then getting into the workflow of encoding it, publishing, hosting, all of that. All of that is still too complex. And it has to be much easier. And that's what you'll see a lot of focus on, I think, ease of use. As well as the quality, of course. HD quality is something we've been focused on here at the company. And then consumers, it's just more and more viewing of video. More and more comfort. And it'll just become even more ubiquitous today. And then for companies of all sizes, it's all going that day whether it's selling through video. So meaning that you have products you can sell and you can showcase then the video in a way that you can't otherwise do things or community around products and you can do that with video, too. And so it's just a deeper immersion into people's lives and then easier to use. So it's intuitive whether it's from the capture and also just from the experiencing of it.

LK: You're so right about that too because right now YouTube, they're the market leader in terms of being the destination site with 100 million views in the US alone last month. But Hulu is approaching. And there's other sites, TV.com and the wild success of the NCAAs. I don't know if you're a college basketball guy, but it's pretty incredible to see the sports industry take this step finally into online delivery and that live experience. It's been just in the last couple of years, each one of the major players has entered the field and offered this blended approach to the multi-screen approach.

Peter Csathy: Well, sure. And the NCAA is a great example of how deeply immersive this experience is and how it's become everyday. It's not just early adaptors now. It's become very mainstream.

LK: They could watch it on the phone. They could get it online.

Peter Csathy: Look at it from the content provider's perspective. I know there's a lot of talk all the time, again, of doom and gloom about what all these new technologies mean for content providers and how they can monetize and what it's taking away. And it's ruining their existing business models. But think about the ultimate opportunity. Once people get their arms around how to monetize effectively, now it's getting content in the hands of viewers when they want it, how they want it, wherever they want it. So now there's many more immersive ways to get your content in front of people who value it. And when the choices are unlimited like that, ultimately you're going to be able to monetize it more significantly. So I think that's for the content providers, too. You've got to be very bullish long-term.

End of part three of interview series.

For more from Peter Csathy:

Check out his blog: Digital Media Update

March 25, 2009 — Streaming Media Podcast Episode #24: Sorenson Media
Jan Ozer speaks with Peter Csathy, the new president of Sorenson Media, about the company's plans for expansion and new updates to Sorenson Squeeze coming in Q2.

Listen now

Company Description
Sorenson Media (http://www.sorensonmedia.com/) is the global leader in video compression technology. The company's innovative encoding applications and award-winning video delivery solutions enable users to quickly and affordably deliver quality digital video files over the Internet. Sorenson Media's video streaming technology is used on more than 800 million computers worldwide. Sorenson Squeeze has garnered many major industry awards, including Macworld Best of Show and Video Systems 2004 Vanguard Award, and the firm's compression codecs are licensed by a host of Fortune 500 companies.

A Conversation with Peter Csathy, CEO and President of Soreson Media - Part II

This part two of my interview with Peter Csathy, CEO and President of Sorenson Media. I spoke with Peter last month two weeks into his new job. In part two he talks about his career, managing virtual teams and what's like in the day in the life of Peter Csathy.

Larry Kless: Now, I was reading; it says that you started as an entertainment lawyer. Is that right?

Peter Csathy: Yeah. An entertainment intellectual property media lawyer way back in the day. Now you're taking me way back.

LK: Way back to where it all began. At what point did you get into the video space?

Peter Csathy: Well, so from the very beginnings, I started off as a lawyer but doing media work. So motion picture music work. And then early in the '90s, I transitioned into in-house to first New Line Cinema, then Savoy, then Universal Studios. So I was in and around the movie space and media space for years and years and gravitated from lawyering to being a business guy. So a business negotiator and then ultimately operations. And then I made the move to the internet world, digital media world in very early 2000 and no looking back since. And this is my fourth company.

LK: How many days now has it been you've been in your position?

Peter Csathy: This is the end of my second week. I was just announced on Monday, but I had a week before. And it's interesting. I feel like I've been here because I know the business well, as you can see from my background. I've been in the digital media world for a long, long time. Too many gray hairs now. Maybe not as much hair as I used to. But so I've run enough companies where I feel very -- I think I have a good sense for what works and what doesn't work. I've made mistakes. I think I know how to avoid those mistakes again because that's what you learn with experience. And as long as you have a great team and a great proposition and foundation to work from, you can do great things together. And we're a passionate group of people. As you can tell, I'm pretty passionate. I'm a big believer. Look, I love what I do. And I wouldn't get into this unless I believe with every core of my being that this thing is going to be big, big, big. And so that's why I'm up-and-running. Up-and-running I think very well because my team helped me in that regard. And we're moving. We're moving forward very aggressively.

LK: And in terms of your position now with Sorenson, did it come together pretty quick? ." Did you start the New Year with the transition or did it come up a lot sooner?

Peter Csathy: Well, I don’t want to get into specifics of timing too much, but it was a natural progression from the very beginning when I learned about the opportunity. I only sold the company in November. We closed the deal in November. And I started in February, so things moved pretty quickly.

LK: And a day in the life of Peter Csathy, what's your day look like?

Peter Csathy: This is kind of a typical day in the life. I have two little kids: six and nine. So what I do is -- I never used to be this way back in the day, but I'm an early morning riser now. So I get up at 5:00 in the morning, and I sit down, have my coffee. I bang out a lot of work in the morning before I hear the pitter-patter of little feet coming down the steps. Have breakfast with my family. Then begin the official workday, although I started before that. And then, for me, it's critical to be home with my family for dinner. Help the kids. Put them to bed. And then I'm back on. And knock it out and kind of do it again. And then what's very important for me, I also try to work in at least three or four days a week of workouts.

That's kind of typical. But then that's the non-travel days. But I have teams in both cities. So, of course, I'm traveling, too. And then there's business development. And there's conferences. So it's that kind of world. But I've been doing it for a long time. So, again, it feels very comfortable.

LK: You must in your position just to manage virtual teams use a fair amount of virtual tools, you know, videoconferencing.

Peter Csathy: You know my last company was known as being the best in class with video chat and videoconferencing. And one of my first pronouncements to my teams were, "Okay. Everybody webcams. Immediately." Because we have teams in Salt Lake, and we have teams in San Diego. And the best way, apart from traveling, for getting to know each other and for collaboration is to see each other and do it. And so you may have heard that noise in the background, that ringing noise. That was actually somebody calling me on my video chat application, one of my team members from Salt Lake. So we constantly do that. So it's part of the culture already. And it was such a critical part of the culture in my last company.

LK: That's great. I use Skype. I use TokBox. I use Oovoo. I use a lot of different tools. And I was contacted by a grandfather in Florida just the other day who was reading my blog where I talked about the upgrade to Skype 4.0. And I had my mom upgrade it. And it kind of messed up her settings. And I walked her through it and fixed it. And then I put those learnings up on the blog. So the funny thing is is that just yesterday, I was Google chatting with this grandpa from Gmail because he just wanted to make sure it worked before he tried to talk to his son and grandkids.

Peter Csathy: This is what I suggest; my former company won all of the awards. Four times PC Magazine Editor's Choice. Walt Mossberg was a big fan. So you've got to check out Sigthspeed. It beats all of those other ones hands-down when it comes to video. And the state of the art is really Sightspeed.com/dellvideochat. So that's the one I would urge you to do yours. And check it out. So it's www.sightspeed.com/dellvideochat, all one word. Try that one. I think you'll be quite impressed.

LK: I'll do it. Thanks for the tip. I'd ask you one more question. In terms of some of your proudest achievements, what would you say from a career perspective?

Peter Csathy: Okay. So I'm putting aside family because --

LK: Of course.

Peter Csathy: -- I'm a huge family guy. But apart from that, the biggest achievement for me, Sightspeed was the most satisfying experience. I'm very proud of a number of things. I'm very proud of the team that we assembled there. I'm very proud of the moral that we had and the overall company culture. It was extremely positive. I've never seen such a positive work environment before. And we had a team of about 30 people. We did a lot with a little because we were up against the big guys, and yet, we did win all of the awards. And then ultimately, I'm very proud of the crowning achievement which was having this very successful sale of the company during the market meltdown times because that's almost unheard of and virtually impossible. And the beautiful thing about it is that it was a very positive result for investors and all employees within the company. And so the Sightspeed experience brought it all together.

LK: That's great. I appreciate you sharing some of your personal background and the fact that you're a family guy. I am as well. And that's where it comes from.

End of part two. Stay tuned for part three.

Digital Media Veteran Takes The Reins of Sorenson Media - A Conversation with Peter Csathy, President and CEO of Sorenson Media, Inc. - Part I

Last month, Peter D. Csathy was named President & CEO of Sorenson Media, Inc., the global leader for encoding and compression applications which launched in 1995. A 20-year digital media/technology industry veteran, Csathy has an extensive resume with an unbroken track record of company successes that began following his graduation from Harvard Law School. But those who know him say that he's a down to earth guy and family man with Midwestern values and a remarkable business sense. Most recently he served as CEO of Internet video company SightSpeed, Inc., and engineered the company’s successful acquisition by Logitech, Inc. in late 2008 in the midst the current economic melt-down. Prior to Sightspeed he served as president and COO of digital music leader Musicmatch, Inc., which Yahoo! acquired in 2004. Before that he was COO of eNow (Relegence Inc.) which was acquired by AOL and a long-time media/digital media executive for Universal Studios, New Line Cinema and others. Peter lives in San Diego with his family, is a diehard Minnesota Vikings fan (no matter how difficult that is at times) and is a passionate believer in the power of music. He maintains a personal blog, Digital Media Update, which he updates daily and calls it a "myriad of media and technology musings by Peter Csathy." You can see his full profile here.

I had the opportunity to speak with Peter the following week after his appointment as CEO and the company. At that time he eluded to a number of big announcements outside of Sorenson Media's traditional market sector but couldn't comment on the specifics. But within the last month his new company already has made a number of announcements including their significant expansion into San Diego bringing big employment opportunities in both their San Diego and Salt Lake City offices, the bundling of Sorenson Squeeze 5 with Avid's Editing Software, the use of Sorenson Spark video technology in the new touch screen the Verizon Hub home phone system, and showcasing Sorenson Squeeze 5 and the Sorenson Spark Developers Kit at the NAB Show in Las Vegas, April 20-23, 2009.

I'm pleased to present the first part of this interview with Peter in which he talks about his new job, his short and long term goals and the challenges and opportunities for his company and the online video industry.

Larry Kless: How did the position come about for you?

Peter Csathy: Well, I've been in digital media technology space for a long time, you see. And we had just completed the sale of Sightspeed to Logitech which was a great result for all. And I'm particularly proud because it's a great result for the company, my investors, my employees. And it happened during this crazy economic meltdown. So it was a wonderful thing, a great result, a great home in Logitech. And the transition was happening for the last couple of months. And I'm a company builder. That's what I've been doing. So I'm fortunate that I've had a number of opportunities come my way. Sorenson Media was one of them. And given my background and just given my deep passion for video and my belief that we're in the very early innings of this whole video opportunity, that's how it presented itself. And that's why I decided to go with this team.

First of all, the market opportunity is vast. We're early. Second, Sorenson already had this established name of credibility, of high-quality products, best in breed. And we've been a profitable company, which is very rare, of course. And we have a nice clear direction of where we're going to take things. And then finally, of course, we have the team. And I'm a believer in the team that we have. And we're growing both in Salt Lake and in San Diego. We're hiring. We're expanding because the opportunity's so big and the company's doing well. So for all of those reasons, for me, it was a no-brainer.

LK: Was there any other leadership changes at Sorenson aside from yourself as president and CEO?

Peter Csathy: No, I have the same team, but we're growing. We're expanding the team, as I said, both on the Salt Lake City side and the San Diego side. And so we're hiring and kind of across the board actually.

LK: You know how everybody's looking at President Obama and saying, "Okay. One hundred days, what is he going to do?" Did you have a 100-day plan yourself?

Peter Csathy: Well, I'm a pretty off-and-running kind of guy. I believe in setting the vision, the tone, the objective early on as long as I know enough about the company and about the opportunity to do so. I was able to, I think, hit the ground running with this company. So there are absolute things that we have set in place that weren't in place before that I think can be very exciting for this company. So I don't have a technical 100-day plan, but I certainly have a plan that has been implemented or is being implemented that first and foremost, we've already determined our priorities. And now it's a question of execution in a very focused manner. So that's what we're doing.

LK: Is there any specifics on the objectives that you could share?

Peter Csathy: Well, I can tell you this that we have an exciting opportunity beyond what the company's been focused on today. So we will always focus on being the best in class and most innovative when it comes to the compression and encoding and Squeeze and Squish. And our current slate of products, you can bet that in the near term, there will be a very compelling expansion of the overall opportunity for Sorenson that is going to make the company even more exciting. And, unfortunately, that's all I can say to that.

LK: I understand. When should we expect to see some of these changes or some of this new innovation? In the calendar year?

Peter Csathy: I can tell you that it's not a long term. It's going to be sooner than people think.

LK: What do you think the biggest challenge is so far facing your company?

Peter Csathy: Well, the biggest challenge I think for any company is that there are opportunities everywhere. And you can't spread yourself too thin. You have to really focus. You have to choose your battles. You have to focus and be more right than wrong. And so the biggest challenge for any company is to have that kind of focus. Rather than trying to do everything, you pick the most compelling opportunities. You focus on them. And you really make those take off.

LK: What would you say are some of the biggest challenges just facing our industry right now, online video, streaming in general?

Peter Csathy: I think that the biggest challenge in terms of even accelerating a pace further is that things aren't as easy as they need to be. And I think reaching a wider audience more quickly with the power of what could be done because video's everywhere, as I said, and it's growing by leaps and bounds. But getting the message across to an even wider swath of the small and medium sized business, videographers, even on the enterprise side. The enterprise side is pretty focused on the, but the SMBs, which is a huge opportunity and then on the consumer, a huge opportunity. And the biggest challenge is to make it high-quality, which we can do. Simple or easy to use. And things are too complex out there. So ease of use. And then in terms of a cost-effective solution. When I look at the competitive landscape, that's where I see the big holes. And that's where Sorenson can really come in and fit in. And I think our unique proposition above and beyond all of those kinds of things is that Sorenson is a trusted name.

As I said, we've been profitable, and we've been profitable for a long time. And the company's been around a long time. And we partner with the best, you know, Avid, Apple, others. And so we're a very rock solid company that will be there. And others in and around the space are startups, not proven. And it's not a great time to be a startup.

LK: Well, that was actually a question that I was going to ask you a little later, but I guess I'd ask if you'd have any advice for some of these startups in these kind of volatile, dire economic times?

Peter Csathy: Well, so in our particular space, that is a substantial differentiator from most of the competition. And so for customers, when they're looking at possible solutions, if you're entrusting your video, your precious possession of videos, then you better be working the stage to be around. That's one thing. But when it comes to just generally for entrepreneurs, well, it's crazy out there. It's very difficult to raise capital, obviously. So what you need to have is beyond the obvious of having a compelling composition, you have to have a very focused plan, focused business model. And for those who already have funding, it is not the time to be deficit spending. It is the time to be very lean and mean and get to cash flow break even essentially because funding is not going to come.

LK: You've mentioned that we're in the early innings of the online video game. Each month the video views continue to grow -- comScore said just in January YouTube hit more than 100 million. More people are moving to online video. Any general comments on the growth you see?

Peter Csathy: Oh, yeah. So first of all, as massive as those numbers are today, it is early. It's early. Video is already pervasive, but it's going to be so much more pervasive on a mobile phone, everywhere you are. It's all going to be internet-driven, video-on-demand. And so it's a question of just like text content initially, the internet, it's getting it all encoded and having as broad of a supply, as broad of a library of videos and then it will be just like a Google search. You'll be searching for what you want, when you want, where you want it. And so for those who are essentially arms dealers, like us, we're in a very good position because it is so early. Are videos recession-proof? As you can see by those numbers that you said, the consumers and businesses alike -- first of all, the consumers, they'll consume more and more. People like video. It's compelling. And now that it's so easy to use on whatever device you're on, not as much on the TV yet, but it will be there very soon. It's already there, but it's particularly early there in terms of getting it into the living room.

But for the consumer, video's only going to grow, continue to grow massively. Just massively. As far as the businesses, similarly, from the enterprise side, monetizing your video assets, and again that's why we're positioned really well, but also for the SMBs, when you're talking about, "Okay. How do you make more money? How do you generate more revenues? How do you optimize?" Well, the best way to sell frequently is through video. Showcasing a product. Showcasing of services. And that's something that video can do unlike anything else in terms of from a marketing/advertising perspective. So as you can tell, I'm beyond bullish on the overall opportunity.

LK: Absolutely. And there's been a real move, I think, for small and medium-sized businesses in more localization to provide video as getting rid of the banner ad and using video instead.

Peter Csathy: Oh, yeah. Absolutely.

LK: So one question which you answered was just how healthy Sorenson Media is, you mentioned you're profitable and have been profitable.

Peter Csathy: Yes. The company is extremely healthy. It's one of the great assets of the company is that we have been profitable and profitable for a long, long time. And the company, as I said, has been around. So that's a significant differentiator from others who have kind of come and gone. And I saw that game play out before in other markets. So especially in these crazy times, that's absolutely critical.

LK: And then in terms of just the space itself, from your position, clearly looking at competition and strategic partnerships, and you had mentioned stay tuned for some announcements, it sounds like you're talking about expanding into other areas, potential partnerships and strategic partnerships there. What about the competition? Do you get that question asked a lot about On2, your direct competitor?

Peter Csathy: Well, I'm not going to name specific competitors, but certainly there are a number of parties in and around our space. And all of the things that I indicated why we are uniquely positioned and best positioned is that we are profitable. And you can look at the competition and who else can say that? Certainly, we've been around for a long time. We have a business that's a proven business with a best in class product. We're known as being the innovators when it comes to the core products that we have today. And we have partnered with some of the best and brightest. And we have for a long time. Obviously, Macromedia way back when which has become Adobe. Apple as well.

We really empowered or enabled video of the internet from the very beginning. So we're the pioneers. And we have a very interesting business model. So when you look at from a partnership perspective, why us? Well, all of those reasons I just said. Because partners need to make sure that the company's going to be around; that's critical. We're best in class. We're built to partner. And if you look at my background, partnership is essentially in my DNA is the way I see it because for 20 plus years, I've been very partnership-driven. And that's how we built my last companies. That's how we built the company before that. And then throughout my career before that, it was very partnership-driven. And we can uniquely offer partners of all kinds, such as the Avids of the world, a world class solution that is something that they need and their customers need.

End of part one. Stay tuned for part two.

About Sorenson Media, Inc.
Sorenson Media (http://www.sorensonmedia.com ), the global leader for encoding and compression applications, provides hardware and software solutions that enable users to easily and affordably compress, manage and deliver quality video over the Internet and to CDs, DVDs, mobile devices and other formats. The company also produces quality tools for publishing and managing user-generated content. From the time it was launched in 1995, Sorenson Media has been at the forefront of seminal trends, products and technology that have dramatically improved the Internet experience for developers and users alike. The Sorenson name has become synonymous with quality, innovation, ease-of-use and cost-effectiveness in video compression and encoding. Beginning in early 2007, Sorenson Media entered the realm of user-generated content with the release of easy-to-use Web applications and editing and management tools for the development of customizable video sharing sites.

Related Sorenson Media Press Releases:

• April 13, 2009
  Sorenson Media to Showcase Industry-leading Video Compression Products at 2009 NAB Show
• April 02, 2009
  Sorenson Spark Powers Video Playback on the Verizon Hub
• March 30, 2009
  Sorenson Squeeze 5 Bundled with Avid Editing Software Gives Users Seamless End-to-End Process for Publishing High-quality Video
• March 17, 2009
  Sorenson Media Announces Significant Expansion Into San Diego
• Monday, March 02, 2009
  Sorenson Media Names Digital Media Veteran Peter Csathy as President and CEO