Grass Valley president Tim Shoulders on the next steps for the soon-to-be-sold Belden company

Shoulders: We are changing to meet new market demands that are going to cause some disruption

When Belden announced that it was divesting Grass Valley on 30 October it sent ripples through the industry and also had people asking the same question: what’s next for Grass Valley?

Tim Shoulders, the president of Grass Valley, spent a few minutes discussing the situation with SVG and the good news for GV customers and the company is that Shoulders is confident that the move is a positive, especially given the changing dynamics in the industry.

The likely outcome, he says, is a new private ownership structure that will be a seamless transition for customers who ultimately should not care who owns a business as long as the quality of products and delivery of those products is at a high level.

“Things are changing as purchasing models go from cap-ex to pay as you go and from proprietary hardware to COTS hardware,” he said.

“And we are changing to meet new market demands that are going to cause some disruption like the J curve. But going through those changes as part of a public company is difficult because you need to deliver results for shareholders. So, we will be able to more readily do that under private ownership and we can help transform the business going forward.”

Private ownership typically buys a company two years of investment which would give Grass Valley the opportunity to embrace new business models like SaaS, cloud services, and subscriptions at a potential loss for the near term but then show a profitable return on that investment after that initial 18-to-24-month period.

“With private equity, you can drive growth in a few years while when you are public you have to carefully balance things and reduce costs,” said Shoulders.

Shoulders added that the current management team will remain intact and customer-facing roles, like sales, marketing, and R&D, will not be impacted as those functions were not shared like accounting and other back-office functions.

Grass Valley has historically been well known for its heavy investment in R&D and Shoulders expects the new owners to understand the importance of the current transformative period the industry is going through. And Belden, he added, has laid a good foundation for those future efforts as well by instilling discipline, right-sizing, and helping put Grass Valley in the top quarter of the industry in terms of profitability.

“SaaS and cloud-based services will be core to our strategic plan, and no one can do it better than us because we have such a broad product portfolio,” he said. “We are building out solutions that have value and create operational efficiencies and we are still committed to making a big splash at NAB.

“We have key product launches as our camera and switcher teams have some exciting things planned.”