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Given the evolution of devices, it's not all just about playback on a PC for CyberLink, is it?
“We include video editing under the PowerDirector brand and photography under PhotoDirector, in addition to specialized solutions for color and audio adjustments and an all-inclusive Director Suite”, he explained. “Each of our key software runs on Windows platforms, and PhotoDirector also runs on Mac OS X. Most of our products have free companion apps available on Android, iOS, and Microsoft platforms. Today, our revenues are well balanced between royalties from PC manufacturers on pre-installed software, and direct retail and online sales”.
Multiple platforms brings up the subject of free apps for tasks that traditionally required ‘purchased software'.
Given that people no longer seem to rip music etc. from CDs, today’s generation all seem to have ‘Download’ buttons integrated into their browsers – grabbing content from YouTube etc. and transcoding on the fly – KitGuru asked Richard if CyberLink offers something in the download/transcode/re-transmit environment that’s better than the freebies?
“PowerDVD provides huge benefits”, he said. “Downloaded content – of course we are only advocating when done legally – comes in many different qualities and formats. Our software ensures that any content can be played in its best possible quality and compatible format, based on the playback environment. Whether content is sent to a 4K TV or to a smartphone, the software does the work in the background, instantly and efficiently, enhancing this content far beyond the original. We provide the best playback performance in the market, andconsumers value quality. When they spend thousands of pounds on home entertainment equipment, smart phones, laptops, headphones, etc., PowerDVD is a rather small additional cost to make content playback the richest possible experience”.
So is CyberLink sticking it its ‘home turf', or will it be looking to expand its product line up in the future?
“In the past year, we have also very successfully built a beauty app business for smart phones”, Richard explained. “We’ve quickly reached over 40 million downloads and more than 250 million sessions each month between our YouCam Perfect (selfie) and YouCam Makeup (beauty) apps”.
OK. That's diferent. How did CyberLink built these apps?
“These innovative apps are derived from our 130+ patented photo and video technologies”, said Richard. “In order to accelerate growth of this new segment while not losing focus of our core software division, we decided to spin-off this new business into a company called Perfect Corp. Both businesses will continue to evolve at their own respective pace”.
Given that the company started with PowerDVD, clearly designed to play back content created by others – these new products are more about users creating their own content. Between ‘playback’ and ‘creation’, what is the balance of CyberLink’s offer going forward?
“We are quickly reaching a point where about half our business comes from our Creative and Playback software. Our corporate strategy can be summarized as: ‘Create and Play'. We are striving to be the leader for consumer multimedia technologies on both dimensions”, said Richard.
Talking brass tacks, in spite of Richard's highlights, CyberLink's shares have traded down to around half the value they achieved in 2007. Which raises the question of whether there is a future for smaller media software companies – outside of royalty payments for patents?
“CyberLink’s business model has completely been transformed”, said Richard. “In addition to royalty income, retail & online sales directly to consumers are now representing a significant share of total revenue and are growing faster than the overall market. We are grabbing market share from competition which, for the most part, has not continued to invest in R&D and sales channels like we have. In addition, we are quickly building a strong app business. We believe that our focus on consumer digital media, our passion, and our ability to move faster than large corporations will reserve a bright future to CyberLink”.
KitGuru says: We thank Richard for spending time answering our questions and for not ducking the tough ones. CyberLink's story should give heart to anyone working with a smaller software company – unsure if you can turn a smart idea into a sustainable business – two billion units of any software package is not to be sniffed at.
