The following is a message to Crispin customers, partners and friends
from Crispin Founder and President, Alan DeVaney.
October 2009
Dear Customers and
Friends,
I thought it would be a good time to share
with you some of the important happenings at Crispin. I’d also like to share
with you some of my observations of the broadcast technology business in this
most tumultuous year as well as address some questions and concerns that we
continue to hear.
First, I want to
say thank you for being part of the Crispin family of customers, partners, and
friends. Despite being a difficult year economically, I’m as satisfied as ever
with our position in the marketplace and I have each of you to thank for that.
I value the relationships we’ve built together and it’s from that foundation I
believe we’ll have many great years ahead of us.
Our year has been a
difficult one at times but we’re hanging tough. Every path has some puddles and
I expect that many of you have seen some struggles this year, too. Our new sales
were down significantly starting earlier this year. Consequently it was
necessary to cut some of our staff back in the spring. As difficult as that was,
it was necessary to adjust to the new economic realities that the economic
downturn presented. Most of the positions we shed were in sales and R&D so
the change might still have gone unnoticed by many of our customers.
And even though we
cut back some on R&D, we’re still making great strides by creating new
technologies and enhancing our current products. For example, just recently I
sat in on a demonstration of our newest offering, MetaTag,
a new plug-in to AssetBase that allows our customers to create their own meta
data fields for assets and even create multiple virtual assets for their
material with frame accurate timings, all using a lorez proxy. It’s more than
just cool, it’s part of a broader initiative we are
undertaking in dramatically extending our current media asset management
solution. We look forward to sharing it with each of you during our upcoming
product launch.
Innovation is part
of Crispin’s DNA. We wouldn’t be the same if we didn’t keep moving the industry
forward. Whether it’s adding archive and storage management as we did many
years ago, or more recent innovations like BXF and Digital Transfer Agent,
we’re optimistic about the future in no small part because we’re confident we
can add the technologies and solutions that will help our customers now and in
the future. And our continued commitment to innovation is one of the big reasons
why we are poised for a period of strong, sustained growth.
Why is that the
case? Well, since the beginning of the company I have chosen to re-invest our
profits in the company. Each year we have been in business we have been able to
add to our software offerings with new features and innovations. These software
applications allow us to provide the most complete system solutions to our
customers. And because these applications have already been “paid for” we can offer
our customers this complete solution at a cost that is much less than
comparable solutions from our competitors. When you add in the fact that we do
not require support fees, our solutions become even more cost effective to
customers over the life of the product.
But it’s also important
to me that you know that just because we cut our operational costs, we’re
committed to being here, today and tomorrow, with the very best team in the
broadcast engineering industry. We’re standing by ready to help you with your
need to execute your operations efficiently and flawlessly.
So when will broadcasters
and the broadcast technology firms see a recovery? Your guess is as good as
mine. But I know this, now more than ever, our mission remains the same: to
provide the very best broadcast engineering technology solutions and service to
our customers that we can. I also know that in many regards business is a lot
like life, it’s not about how fast you run, or how high you climb, but how well
you bounce. We’re managing these times carefully but it’s also not changing our
overall strategy. In fact, part of what I’d like to share with you is just how
our strategy is more relevant today than ever.
To
better explain our strategy, let me start by sharing an old cattleman’s saying
that my father shared with me: always drink upstream from the herd. When I
think about Crispin in the marketplace versus our competition, it simply
doesn’t interest me to do things the same way the others do it, especially if
it doesn’t serve the needs of our customers. Case in point: years ago we
decided to drop our policy of requiring customers to purchase those recurring
annual service and support contracts for the first seven years after purchasing
an automation system from us. The reasons were simple. Customers told us that
they didn’t like paying for something they thought they should get for free and
we certainly believe that we are responsible for supplying customers a bug free
system.
Does it make sense
that software bug fixes and 24 hour phone support should be free or included
with the purchase? After hearing this feedback from customers, we thought so.
Just as people have learned to expect that a new car comes with a multi-year
warranty to fix problems and defects that may come up, we believe the same
principle applies to software. If our software doesn’t work right because of a
software glitch, it only makes sense that we should pay for that, not the
customer. We call that support plan Crispin 4 Life as a reminder to you—our
customers—that we intend on doing the right thing in order to retain you as a
customer for life.
The funny thing is, seems like sometimes when you make things simpler, someone’s
ready to jump in there and try and make it complicated again. Many of our
competitors out there have set out to do just that. It seems our free support
plan hasn’t sat to well with some of them and they’re out to do whatever they
can to either say it ain’t so or even tell everyone
why it isn’t good for us or even why it isn’t good for you.
As one argument
goes, a software company is a lot healthier if you charge annual support
because you always have recurring revenue. True, we’d make more money in the
sort run if we charged you each year but does that make us “healthier”? We
don’t necessarily see it that way. Look at it this way, Southwest Airlines
could charge a lot more for their tickets or by charging for each piece of luggage
like other airlines do. But if they did so, would it make them healthier? What’s
important is to know what drives your economic engine, not your competition’s. And for us, the financial model that works
for us is to sell some of our product to new customers and then provide
superior service on that system at no additional cost and trust that the customer
will recognize the value and continue to select Crispin for future needs. That
model simply doesn’t require expensive and unnecessary annual support
contracts.
Of course, that
means having a solid customer base that believes in us and wants to continue
purchasing our new offerings, not bug fixes. We think that model provides a lot
more value to our customers and it’s also a model that benefits us in the long
term. We do have some revenue for support and services. Most of this comes in
the form of enhancements to the system above what we originally sold.
Since our support
plan is distinct in that it covers phone support and updates for software fixes
for the first seven years, it requires that customers pay for elective changes
to the system such as Mapper traffic file translation changes, new device configurations,
and so forth. We’re upfront about this during the sales process and we haven’t
come across a customer yet who didn’t agree this was a fair way of doing
business. In fact, seems the only people who object are our competitors who
have done their best to instill some fear that it either isn’t sustainable or
is laden with hidden costs. Neither is true and I hope this explanation helps
explain why.
You
see, we’ve been operating this way for more than four years now and what others
in the industry are convinced is a problem for us has actually been a huge
growth engine for us. What our detractors have said reminds me of what Mark
Twain once wrote, “it ain’t
what you don’t know that gets you into trouble. It’s what you know for sure
that just ain’t so.” Just like how Southwest
keeps selling tickets and growing profitably, we think a good deal like our
Crispin 4 Life support plan just makes good business sense.
And so when we hear
that a critic suggest that there isn’t any way we can stay in business without
charging annual support, it reminds me of some of the same voices I heard when
I first started Crispin in 1997 that we couldn’t build a business by selling
software so inexpensively. We still have more innovations to bring, both in our
products but also the way that we do business in order to meet our customers’
needs. In doing so, I believe that we’re poised for growth that we haven’t seen
in our nearly 14 years of business.
I hope this letter
has helped shed some light on what we’ve been doing over the last year to deal
with the economic uncertainties. Perhaps the most important message is to
convey what it hasn’t changed for us.
I also want to
extend a warm welcome to our newest member of the Crispin family of customers,
WFMZ, in Allentown, Pennsylvania, who will be going online with
our automation solution in a few short weeks from now. Like many other stations
throughout the country, and perhaps just like yours, WFMZ is preparing for a
bright future with the help of some technology that will make things a bit
easier. We embrace that challenge as our own and in the true spirit of
partnership we’re eager to see WFMZ and each of you successful in that
endeavor.
As always, please
drop a note or call if I can answer a question you have on your mind or you
just want to chat.
With Warm Regards
and Best Wishes,
Alan
DeVaney
Crispin President
& Founder
Copyright © 2009
Crispin Corporation. All Rights Reserved.
No part of this letter
may be copied or redistributed without written permission by Crispin.
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