SeaChange Mobilizes for OTT

Touts Progress of ‘Rave’ Platform
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Indicating more traction for its new “premium” OTT platform, SeaChange International said a yet-unnamed U.S. prepaid mobile service provider has struck a deal to tap in. It marks SeaChange’s first OTT deal in the category.

“During the second quarter, we began to see increased interest from mobile providers looking to add new tiers of service to their bundle, including premium video,” company CEO Jay Samit said Wednesday on the company’s second quarter earnings call.

SeaChange announce Rave late last year, noting then that it had already been picked by BBC Worldwide for its com ing BBC Store. Algar Telecom of Brazil is also an announced Rave customer. Samit said SeaChange has four Rave trials underway.

Analysts again pressed SeaChange on why it has yet to secure wins with the links of HBO, which is now working with MLBAM for its OTT offerings.

Samit said HBO’s talks with MLBAM started before SeaChange launched Rave, but stressed that “that is exactly the type of customer that we’re having conversations with.”

But he later allowed that the market is interested to see how SeaChange’s OTT work with BBC works out. The BBC launch is “imminent,” according to Samit.

On the financial front, SeaChange posted a loss of $4.8 million (14 cents per share), narrowed from a year-ago loss of $5.6 million/17 cents, on revenues of $27.9 million, up 20% sequentially.

SeaChange attributed the revenue growth to a boost in new product revenue, which is up 50% year-on-year. That included a new win for its Adrenalin multiscreen video backoffice in Canada and the delivery of its advanced ad platform to an existing telco customer. Additionally, Liberty Global launched SeaChange’s Nucleus video gateway software during the quarter, while its launch of Nucleus in Latin America “remains on track,” Samit said.

Legacy revenues dropped 87% year-on-year, and accounted for just 9% of product revenue. Year-over-year service revenues dropped 1%, to $20.9 million. International sales now account for 58% of total revenues.

SeaChange ended the period with $72.8 million of cash and no debt.  

Looking ahead, SeaChange expects third quarter revenues of $27 million to $29 million and non-GAAP operating results to be in the range of a loss of $0.10 per basic share to a loss of $0.04 per basic share