Avid chief Krall departing
Hawthorne in as interim CEODavid Krall is stepping down from his position as president, CEO and board member at Avid Technology at the end of July. Nancy Hawthorne, a board member and former chairman, will serve as the company's interim CEO while the board begins a search for a new chief; Krall will be available as a consultant to Avid during the transition period.
The 20-year-old company helped pioneer nonlinear editing. Over the years, the company also grew by expanding its product portfolio in the media and entertainment space, as well as with numerous strategic acquisitions.
Regarding the decision announced Monday, Krall said: "It's mutual; it was the right time for a change. ... Avid is in a good position. The last five years the company has doubled revenue and staff size." He added that Avid would be seeking a leader to reflect the company's current size.
"With Avid's 20-year track record helping customers to create and distribute the world's most compelling media, and numerous opportunities to expand across an increasingly diverse marketplace, the time is right for new leadership at the helm," Krall said. "I'm proud to have played a role in helping Avid become a leading technology and services provider."
Krall served as president, CEO and board member for the past seven years. He joined Avid 12 years ago and has held such positions as vp technology and COO of the company's DigiDesign unit.
Hawthorne, who serves as CEO of financial advisory and investment firm Clerestory Llc., has been a member of the Avid board since 1997. She was the CFO of Continental Cablevision from 1992-96. After Continental's merger with U.S. West, she became an executive vp at the merged company, MediaOne.
Commenting on behalf of the board, Avid chairman Pamela Lenehan said: "David has been instrumental in transforming Avid Technology's business and keeping it at the forefront of the digital media revolution. He has helped direct the company's efforts to revitalize its postproduction business; secure a leadership position in broadcast news production; grow its audio business through market expansion and product development; and enter the consumer video and audio markets through acquisition."
Avid's businesses have grown well beyond feature film editing, but its name remains nearly synonymous with that application. American Cinema Editors board member Harry B. Miller III said that in a survey of ACE members conducted late last year2006, 90% of respondents said they cut on Avid.
"In the Los Angeles and New York film community, it is by far the dominant system, but it is being challenged in a big way by Final Cut Pro," Miller said.
Even before Monday's news, film editors Steven Cohen and Paul Rubell formed an editors advisory committee recently that hopes to meet with Avid to discuss recommendations.
"Avid is still dominant at the top of the postproduction market," Cohen said. "To hold that position, it needs to reinvigorate Media Composer. ... We think they can build from that position, and we'd like to help them do that."
Added Rubell: "We love their product. We want to make sure they are in a position to continue their leadership in the field."
As for Avid's next step, the industry will have to wait and see.
"The question is what does the board plan on doing with the company," said Howard Brock, president of motion picture technology services company Runway. "Are they answering to Wall Street or are they answering to the customers?"
Avid also reaffirmed its second-quarter guidance of $220 million-$230 million in revenue and non-GAAP earnings of 15 cents-20 cents per share. It plans to release its financial results July 26 for its second quarter ending June 30.