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ClearOne Acquires NetStreams for $2M
NetStreams to maintain presence in residential market and continue to operate out of Austin, Texas.
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Nov
03

By Julie Jacobson
Filed in: News, Mergers and Acquisitions, Multiroom Audio
Comments (5), Ratings (0/5)

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11.03.2009 — NetStreams, a pioneer of IP-based audio/video distribution systems, has been acquired by ClearOne, which calls itself "the leading global provider of audio conferencing solutions."

Despite ClearOne's commercial focus, NetStreams does not plan to abandon the residential market. "We're still very much targeting the residential space," says Kevin Reinis, who will be leaving his post as president and CEO of NetStreams.

Reinis says NetStreams has brought on 12 CE rep firms to complement the company's distribution through AVAD. Buzz Goddard, who handled international sales for NetStreams, will lead worldwide sales.

ClearOne paid $2 million in cash and assumed $2 million of long-term debt for the transaction. ClearOne also will make earn out payments over the next two years based on achievement of certain performance criteria.

Privately-held NetStreams, which has about 20 employees, will continue to operate out of Austin, Texas. NetStreams' 2009 revenues are expected to exceed $5 million. ClearOne reported revenues of $35.7 million for its fiscal year ended June 30, 2009.

Despite its strength in IP-based audio conferencing, ClearOne has not managed to penetrate the video side of the business, which is dominated by the likes of Cisco. "That's where we come in," says Reinis. "We have video and control." He adds that there is "very little overlap" between the two enterprises, both in terms of channels and intellectual property.

NetStreams is developing products for HDMI over IP. SpeakerCraft (Nirv) and newcomer Just Add Power are working on similar products. But there's a difference, Reinis says. "We don't have to demonstrate product," he says.

NetStreams has been selling IP-based audio products since 2002 and added 1080p 1080i video distribution in 2006.

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Julie Jacobson, Editor-at-large, CE Pro
As a co-founder of EH Publishing in 1994, Julie has edited and contributed to all of the company's publications at one time or another. An authority on home automation, networking, integration, digital convergence and the CE pro channel, Julie speaks often about these subjects at industry events. She graduated with a B.A. in Economics from the University of Michigan, and received an MBA from the University of Texas at Austin. Julie is a washed-up Ultimate Frisbee player.
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Comments

Posted by John Nemesh  on  11/03  at  04:27 PM

Actually, NetStreams has been working on 1080p video distribution, they dont have it yet.  If you read the article you reference, the demonstration in 2006 was 1080i video with 1080p “coming soon”.

That being said, I have run a side-by-side demo in our showroom with 1080p HDMI next to 1080i over cat5 via the NetStreams system, and customers could not tell the difference and even picked the NetStreams over HDMI in a blind test!

Posted by Julie Jacobson  on  11/03  at  04:32 PM

John, you got me again. Thanks for the clarification. Making the change.

Posted by Josh  on  11/04  at  05:42 AM

Just Add Power has been in business for a LONG time. He found out about CEDIA etc shortly before CEDIA.

Posted by JBerger  on  11/04  at  06:30 AM

So what is he trying to say with the quote “We don’t have to demonstrate product”?
Is he calling JustAddPower’s shipping products vaporware? I have 2 sets of the gear on the test bench right now, so I know it’s shipping.

I think Netstreams has great underlying technologies, but the user interface limitations were really holding it back from broad acceptance. It will be interesting to see if the new owners actually commit to moving forward in residential or adopt the tech for the commercial market and let Netstreams residential die on the vine.

Posted by John Nemesh  on  11/04  at  01:22 PM

I never really had a problem with the interface with NetStreams, and I LOVE the sound quality (IMHO the best out there!).  After updating our demo system to the 2.5 firmware, I noticed a SIGNIFICANT improvement in the responsiveness of the entire system and a much snappier interface.  Even better are the iPhone/iPod Touch apps and the Philips Pronto module…these bypass the flash interface and are even MORE responsive than the native touchpanels!

I am really hoping that with new owners, they will now have the cash needed to further develop their excellent technology.  We really NEED a 1080p HDMI over IP solution (with HDCP!) from them, and I am REALLY anxious to see their new “Uber Manager” (thats the old internal name for it) that they have been working on.  If they can deliver that product with internet radio (specifically Pandora) support, we will have a real winner!

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