MACR deal
by: lariatforprofit 08/15/05 10:39 pm
Msg: 131106 of 131188
The common perception of this board does not make it accurate. The common perception of this board also seems to change with the wind and the share price and is a perfect example of why you should not gleen information from a message board to make investment decisions.
The ON2 revenue stream for encoders and software come in the form of direct sales of the Flix line of products and the royalties generated by the licensing of software to companies that make and use encoding software. This is why ON2 has an exclusive franchise for a number of the encoding functions. THAT is the end of that story.
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MACR deal
by: lariatforprofit
Long-Term Sentiment: Strong Buy 08/15/05 08:57 pm
Msg: 131092 of 131189
According to a conversation with DAM in April, they make money on the exclusive franchise for a number of the encoding functions. Beyond the encoders sold by ON2, they license the software to companies that make and use encoding software. This would include MACR, Sorenson, Autodesk, and others and drives a seperate royalty stream that is independent to the license that MACR paid for.
They are also, according to DAM, working on Flash video ports to non-PC platforms which I assume to be reltated to Flash Lite and the mobile market. This market is by itself substantial and as I pointed out in prior posts, it should be a slam dunk. It would be silly for MACR to use something else considering that they have not only paid for it, they have publicly proclaimed that they raised the bar by selecting ON2 in the first place. Some will call this dot connecting, I like to think of it as common sense.
NDA's are frustrating, but we have an impressive client list with a number of them yet to announce major developments/initiatives. Given the size and market penetration of some of these companies, the backend arrangement is where the money is going to be.
The distribution of Flash is a "watershed event" because of its market penetration and it should be believed that this will not only aid ON2 in "inking" other revenue deals but improve its revenues, visibility and branding. It should also take us into the mobile market. The mobile market will require encoders, decoders and porting which will also generate revenues.
Our Flash connection also makes the XMSR deal more attractive because of the versatility that is attached to it. XM can be received through your computer. If they can deliver video to your car, they can deliver it to your computer, just like they deliver their radio service. Seems to me that a royalty will be tacked onto the subscrition fee.
AOL, VOIP partners (apparently Skype and another company reported to be one of the industries largest). These are partners that have yet to announce what they are doing with our product. Undoubtedly a revenue stream there. A revenue stream that I'm sure will become clear when deployments are made.
As I have said, NDA's are unfortunate and frustrating, leaving you with nothing more than
to establish how significant the deals could be until you get more information. The question for the investor in this game is when to buy. I have decided to buy and accumulate ahead of the PR's than after when the share price reaches where I would have sold what I'm willing to trade.
I think that DAM's ass is just dead by disguise and out of necessity. LOL Our partners are too big to want to advertise their intentions before there is a deployment on the horizon.
This is what I choose to believe and why I invested here. The video revolution is on the horizon and I think that ON2 is going to be a big part of it.
