Chyron AXIS Acquisition Positions It for Exponential Growth

Chyron (CGS) recently acquired AXIS Graphics and announced the launch of Chyron Online.

Chyron has a 40 year history in graphics generating hardware and software primarily for broadcast applications. The "lower third," or streaming information on bottom of screens on CNN, CNBC, etc. is frequently referenced as the "chyron". Major clients also include virtually all the major sports broadcasters in the US, such as NBC, ESPN, and FOX. AS we see the increasing utilization of graphics to relay instantaneous statistics and information during all sports contests, we are also seeing the growth in demand and the market for these applications.

As graphics generation has evolved from being a hardware centric model into a software centric model, the power and capabilities of these graphics applications have multiplied while costs of utilizing these technologies have been reduced. Chyron has remained solidly in the forefront in all technological advances, and as we enter 2008, a year that involves a "quadrennial effect" (boost in demand from being both an election year and an Olympic year), this launch of Chyron Online is perfectly timed to take advantage of the rapidly expanding video markets in websites, newspapers, radio stations, mobile phones and digital signage globally.

Randy Pyburn, AXIS Graphics Founder, commented recently that "Chyron is the industry leader for broadcast graphics and this technology partnership takes the AXIS service to the next level by providing a one-stop seamless platform to create, composite and distribute graphic content over the Internet for traditional and new media markets."

This author recalls multiple applications that have not been seamless in integration with existing applications – such as in the years in the early 90s before Microsoft Office became the prevalent and dominant software for spreadsheet and word processing applications. While Lotus and WordPerfect were excellent in performance – it could be argued the market moved to a status where integrating seamlessly between users, offices, customers, etc. became the single dominant factor in the selection of the common office applications.

In this correlation lies the brilliance of this acquisition/combination orchestrated by Chyron CEO Michael Wellesley-Wesley. As the market leader in broadcast graphics, Chyron Online offers the easiest, most cost effective transitions as organizations evolve from traditional advertising platforms of broadcast TV, print (newspapers and magazines), and radio to web and video based methods of distribution of content – and with that – the new methodology of distributing advertising.

Recent studies indicate that online advertising will double in the US by 2011, to $50 billion annually.

The convergence of many factors indicates that Chyron is well positioned for exponential growth in 2008 and beyond. Third quarter 2007 provided a revenue increase of 36% year over year. This author expects these results to be exceeded in the 4th quarter results to be released in early March. The substantial contract signed with NBC Universal in 2007 – of which the inclusion of graphics for the 2008 Beijing Olympics may be at the forefront – along with progress in other initiatives in providing graphics applications as advertising continues its precipitous evolution to web and video distribution channels, will move Chyron from the position of the leader in the worldwide broadcast market into a position of leader in all graphics generation markets.

Disclosure: Author is long CGS.