The old Philips content identification business which has been spun off to become Civolution, and the Sony subsidiary which operates similar services in the US called Gracenote, are getting closer it seems.
The two have issued a pre-NAB release saying that the Civolution Mediahedge product will now be sold jointly by the two companies, in what is almost a repeat of a 2005 deal where audio fingerprinting technologies from Civolution ended up being owned by Gracenote.
Gracenote will be marketing and selling Mediahedge in North America and Japan, while Civolution will cover the European markets. No-one has mentioned China, Asia Pacific or the rest of the world, but given that Sony has the further reach in these countries it is not only likely that Gracenote will end up taking these territories, but we think that if the Civolution technology proves useful enough, Sony will end up owning the entire thing.
Civolution is headed up by fingerprinting and watermarking genius Alex Terpstra, who led the work at Philips to create audio finger printing which would recognize copyrighted music on the internet or in broadcasts. Fingerprinting takes statistical data about music or video and looks for unusual relationship between notes, and between luminance and motion in video. The idea is that even compressed video and music or different versions of the same track by the same artist, are all distinguishable.
After cutting a deal with Gracenote in the US to use the technology, Gracenote went on to establish the biggest database of musical fingerprint signatures in the world and become the basis of services like TrackID, where your phone can ‘listen’ to a few seconds of music and identify the track and let you buy it online. It was also useful in piracy detection though perhaps not as useful as watermarking, which actually places a unique signature into the media to see which version was released into the wild.
Terpstra has, on many occasions told us how much he regretted having to sell this technology off to Gracenote in 2005 for a paltry $10.9 million, because Gracenote had become by far its largest customer. While still at Philips he said that his plan was to ensure that his organization built its own video fingerprint database, and it is still in the process of doing this. Since then the business was the focus of a management buyout and it is going back to its own roots to look for ways into new markets.
After the buyout Civolution took ownership of a joint venture with Teletrax, and bought out the Thomson STS watermarking business. Now it looks like Gracenote has all the sales contacts and Civolution needs its prowess once again.
The big contract which got away from both of them was when Google was touting around for a fingerprint technology to identify YouTube uploads to see if they were copyrighted material. Google ended up building its own tools for this, but Civolution and Gracenote together, using a combination of both audio and video fingerprinting, now has an off the shelf product perfectly capable of doing this.
The new Mediahedge (which has been out for a while but can be thought of as new since it can use both the Gracenote database and the Civolution video fingerprint database) is being touted to US Hollywood studios at NAB to enable content filtering, monitoring and monetization across the web. It hopes to have a new lease on life in Over The Top video services to go with its monitoring role in broadcast networks. The combined platform is operated as a hosted service.
‘By integrating Gracenote’s and Civolution’s identification technologies to create Mediahedge, we are able to offer content owners a complete solution for tracking, filtering, measuring and monetizing their assets,” said William Schulze, Director of Business Development, Gracenote.
We assume that Sony’s Crackle (nee Grouper) either already uses this technology or will at some future point.
All of which sets up Civolution to be perhaps a step away from realizing that if it cedes such large sales markets to its Gracenote partner, then if Sony decides it is worthwhile, it would be able to offer little resistance if it wanted to acquire the business.
Sony paid $260 million for Gracenote after it raised just $50 million in five rounds of funding, and its revenue was around the same level at around $50 million, so it has tended to be generous so far in this technology area.