Mergers, not necessarily a sign of industry health

It seems that just about every company in the audio and notation business has been involved in a merger or acquisition in the past 5-10 years. I suppose this has been the norm for much longer than that. But I saw news today that Izotope is merging with Native Instruments. Izotope apparently acquired Exponential Audio a few years back, but the NI thing would be much more significant. Both of those companies have been major technology leaders, albeit not the easiest to work with.

I recently learned that Finale/Makemusic is being rolled up with Alfred Music, which is fairly significant to the notation industry as Alfred is a major publishing house.

And I only recently learned that Presonus merged with Fender in 2021. Again, that has the potential to be a pretty big deal because many of the people getting into DAW work also love their Fender instruments and amps.

Of course, AVID acquired Sibelius years ago, which led to the emergence of Dorico under Steinberg. And then Steinberg was acquired by Yamaha, which would seem to be a pretty big deal, but I don’t really see much evidence of Yamaha exploiting the Steinberg capabilities and experience.

There have been many flowery press releases of mergers that had all the best buzzwords and talked of all the synergies that were bound to spring forth from the combination of talents. I remember Roland buying Cakewalk. Seemed like it should have worked, but never really did anything useful.

On the live sound side, we have Harmon buying up lots of respectable brands like Soundcraft, then ultimately de-funding most of them in favor of Han’s primary emphasis on sound systems for cars – and then Harmon got acquired by Samsung, which didn’t even promise to do anything useful.

I’m just curious about others’ views about mergers. Can you think of any that actually resulted in better choices and better solutions for the customer?

Sometimes mergers and acquisitions aren’t really about the products involved and more about purchasing IP.

2 Likes

Not many, and exactly because …

… or the customers.

On the other hand, because Yamaha make musical instruments, many of us will no doubt be optimistic about the future of Steinberg. I personally have always liked Yamaha products, and IMHO Cubase and other Steinberg products have improved immensely since the acquisition, but of course I have no idea whether the two are related.

2 Likes

Here is the correct chronology:
2004: Yamaha acquires Steinberg
2006: Avid acquires Sibelius
2012: Avid lays off entire Sibelius dev team
2012: Steinberg opens new office to house Sibelius team in London, and hires the lot of them
2017: Dorico is released

4 Likes

I’m actually a little worried about what seems lessening cooperation between Yamaha’s considerable hardware strength and Steinberg’s software strength.
So I just hope there’s no dark clouds on that horizon…

Because overall I’ve perceived the Yamaha ownership of Steinberg rather positive to this day. It was a dramatic positive turnaround from the year under Pinnacle ownership - which (not entirely coincidentally) was the only Cubase upgrade I skipped (SX2) over the more than 2 decades of being on the Cubase train.


also:

  • iZotope moving to NI is just a name thing - the merger already effectively happened in 2021, when Francisco Partners (large Private Equity technology investment company, who also own a ton of other stuff: ) bought majority stakes in NI and iZotope - officially becoming a single management unit in 2022 under the name of Soundwide and now abandoning that name in favour of the common NI branding.
  • lesser known: Image-Line (Fruity Loops) acquired UVI and MeldaProduction within the last year as well.

and in the music hardware space:

  • Moog has just joined the list of venerable brands being acquired - yet again - they are now under the same umbrella as AKAI and Alesis
  • Sequential (Dave Smith) having gotten the trademark back from Yamaha as a good-will gesture in 2015, ended up being bought by Focusrite in 2021.
  • and for us guitar players, Mesa Boogie being bought out by Gibson in 2021 was also kind of a big deal.

So 2021 was quite a big year for mergers and acquisitions in the music space.

Yep - sh*t is happening in the industry - probably a combination of founders retiring, increased competition growing faster than the market and the generally typical industry life cycles.

And AI is going to do another number - not only on music makers, but also on the music software market.

Making a living in the music making, music software and music hardware space will likely become an even rougher ride than it already is. :scream:

Being a hobbyist should continue to be highly rewarding, though.

3 Likes

Thanks for that correction. So we’re nearly 20 years into that relationship. I assume the stability of Yamaha has been helpful to Steinberg. I would have guessed that there would be more tangible signs of collaboration across the groups, but maybe that was never really Yamaha’s intent. Japanese companies famously take a much longer view than most others.

1 Like

That’s a good point. I note that Paul McCartney is 81 in a few days. There definitely is the sense of the passing of a generation. I’m more connected with the jazz world, especially “modern jazz” (e.g. Miles, Trane, Blakey and those that closely followed. We have lost a whole bunch from that era in the past 3 years. Very few of the real pioneers are still with us (Benny Golson, Herbie Hancock, Sonny Rollins, and very few others who were leaders of that entire period). We just lost Wayne Shorter.

While the DAW world (including early MIDI and sequencing) is a few decades younger, surely most of those pioneers are at least approaching retirement, if not gone altogether.

It is never a good sign when these companies are rolled up under a vulture capital group, but I guess that is better than seeing them go belly up. It does beg the question of what the industry will look like in another 10 years. Probably a lot less innovative.

And if a DAW company is going to be in a conglomerate, I’d much rather see it in a group that is really run by people who care about the music business (like Yamaha), rather than a bunch of vulture capitalists, who are more likely to be looking for ways to milk a cash cow. It does really make me think twice about continuing to spend money with some of these companies like Izotope. I guess the real message is, don’t fall in love with a dream, because that could be sold out tomorrow. Spend your money where you get real value today.

1 Like

And don’t forget Pinnacle System’s acquisition of Steinberg Media Technologies in 2003 only to be bought themselves by Avid two years later. It’s been a rough time for Steinberg employees and Yamaha helped a lot when they came to the rescue back in the days.

7 Likes

Ed, please. I actually try to forget that. :grinning:

3 Likes

:scream:
image

3 Likes

I’d forgotten people had hair back then.

2 Likes

How true !

I recently got this in a Yamaha newsletter

4 Likes

This is from Greg Ondo’s Club Cubase from months back. Some of the Steinberg/Yamaha interfaces, and other hardware have been discontinued because of a parts shortage because of that fire that happened More Yamaha/Steinberg cross developments are on the horizon he said.

Greg also mentioned Steinberg’s priority is always going to be software. Anything hardware will be partnered with Yamaha. Yamaha’s new DM mixers have Cubase/Nuendo integration. The new DM 7 comes with Nuendo Live I think.

1 Like

Thanks for making it even worse now.