UK recommendation engine player ThinkAnalytics should really just come out and give us its true financial figures, but instead, each year it puts out a release that says that revenues have grown by 100% and so have profits. This year the numbers changed, suggesting that it is getting closer to market saturation – saying that revenues were up just 50%, but that its profits went up 200%.
The progression since 2012, when it said it had 70 employees was that its recommendations reached 70 million homes. This rose to 130 million a year ago, and today top out at the 150 million mark. Given that this is out of a total global pay TV market of some 800 million homes, or out of a total of 1.5 billion TV homes, so it’s 10% of the world’s TV sets and close to 20% of paid TV.
But not knowing the starting revenue number makes it tough to make any sense of these numbers. If it was $6 million in 2012, then 100% rise to $12 million followed by a leap in 2014 to $18 million, would still make it a relatively small company and its revenue per employee would still be down at maybe $200,000, which is low for a software house – but then again its costs are in Scotland, where costs are usually very low. But it might just as easily be double those figures. Profits could easily be $400,000 followed by $800,000 followed by $2.5 million, or they also could be double that or considerably higher. So it’s hard to see how much praise is fair, and it’s only safe to say the company is going in the right direction. We imagine much of the revenue improvement comes from operators gaining confidence in recommendations, and using them more widely.
But whatever those hard numbers are, the trajectory is slowing, and chances are that next year’s the growth will be something closer to 25% and the profit rise more like 50%. Surely it is time to cash in, and sell out to one of the many pay TV software houses out there, including partner NDS, itself owned by Cisco, which could give it even greater momentum.
ThinkAnalytics continues its release reminding us that it has new contracts this year with Fox, Sony, Viaplay, Get, and Sunrise – only Fox, Viaplay and Swisscom deals have been announced so far this year, so Get and Sunrise, one in Norway, the other a rival to Swisscom in Switzerland, have clearly not been thought worthy of announcement, and have slipped into the results release. But it shows that the ThinkAnalytics sales force is not idle.
The number of video operators that had the service in 2012 was just 40. In 2013 that rose to 52, and now it is 60, with 50 of them being pay TV operators (so there are maybe 10 free to air broadcasters in there).
Additionally ThinkAnalytics has US cable company Cox as well as Liberty Global, BSkyB, and Portugal’s Zon among its 50 plus pay TV customers, spread across 30 countries. The company now supports 22 languages, up from 17 in 2013. The ThinkAnalytics platform works mostly in the cloud but can also be implemented as an on-premises solution