Propellerheads might be waking up finally. Not that it means anything yet.
- EnochLight
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There’s speculation and then there’s making educated assumptions based on past history. Here’s the past history: everyone thinks Props are “in trouble”. Here’s what happens: NOTHING. We keep getting new versions of Reason, RE’s, and things move along.
Nothing to see here, folks. Relax.
Nothing to see here, folks. Relax.
Win 10 | Ableton Live 11 Suite | Reason 12 | i7 3770k @ 3.5 Ghz | 16 GB RAM | RME Babyface Pro | Akai MPC Live 2 & Akai Force | Roland System 8, MX1, TB3 | Dreadbox Typhon | Korg Minilogue XD
Well, looking at the financial figures posted on previous page it seems like the new ownership made the company leaner and operating in quite an aggressive (financially) manner, i.e. its ability to cover short-term financial obligations is at 110%, which is just above the expected minimum of 100%, whereas solvency ratio - which indicates long-term ability to meet its obligations from equity and future net cash-flow - fell from 44% in 2014 to 10% in 2016. On the other hand ROA and ROE are very impressive, and so is 27% increase of turnover.
In other words, they're trying to maximise return for investors by increasing risk (reducing financial buffers), which also explains all those recent campaigns (Deal of The Week, Rigs updates, $99 to upgrade Essentials, etc.).
There's nothing wrong with that, unless it's a short-term strategy of just maximising profit per share without any plans to strengthen the ability to generate sustainable revenue in the future, which is not really possible without investment in core product. Therefore it would be interesting to see info on changes in staff structure (overall staff number is down, but structure is more important) and expenses on R&D. One worrying position is "royalties to the board and CEO" which might suggest some of the intellectual property was sold, which isn't very reassuring.
I'd love to see the 2017 numbers
In other words, they're trying to maximise return for investors by increasing risk (reducing financial buffers), which also explains all those recent campaigns (Deal of The Week, Rigs updates, $99 to upgrade Essentials, etc.).
There's nothing wrong with that, unless it's a short-term strategy of just maximising profit per share without any plans to strengthen the ability to generate sustainable revenue in the future, which is not really possible without investment in core product. Therefore it would be interesting to see info on changes in staff structure (overall staff number is down, but structure is more important) and expenses on R&D. One worrying position is "royalties to the board and CEO" which might suggest some of the intellectual property was sold, which isn't very reassuring.
I'd love to see the 2017 numbers
Yea. Not sure what their fiscal year timing is, but i would expect it soon if they publicize them. Especially with their new investor that probably expect higher profits to get revenue, they need to be more aggressive - also the hiring of marketing ppl gives an indication of the direction: more marketing to sell!
As someone mentioned before, having a good user base is mandatory for further investments into the product. No one should invest in a product without a good user base or which does not sell well.
Reason12, Win10
Interesting analysis. Thanks. That makes a lot of sense given their recent behaviour. It's certainly not reassuring.antic604 wrote: ↑16 Mar 2018Well, looking at the financial figures posted on previous page it seems like the new ownership made the company leaner and operating in quite an aggressive (financially) manner, i.e. its ability to cover short-term financial obligations is at 110%, which is just above the expected minimum of 100%, whereas solvency ratio - which indicates long-term ability to meet its obligations from equity and future net cash-flow - fell from 44% in 2014 to 10% in 2016. On the other hand ROA and ROE are very impressive, and so is 27% increase of turnover.
In other words, they're trying to maximise return for investors by increasing risk (reducing financial buffers), which also explains all those recent campaigns (Deal of The Week, Rigs updates, $99 to upgrade Essentials, etc.).
There's nothing wrong with that, unless it's a short-term strategy of just maximising profit per share without any plans to strengthen the ability to generate sustainable revenue in the future, which is not really possible without investment in core product. Therefore it would be interesting to see info on changes in staff structure (overall staff number is down, but structure is more important) and expenses on R&D. One worrying position is "royalties to the board and CEO" which might suggest some of the intellectual property was sold, which isn't very reassuring.
I'd love to see the 2017 numbers
As usual bringing nothing to the discussion other than luke warm air.There’s speculation and then there’s making educated assumptions based on past history. Here’s the past history: everyone thinks Props are “in trouble”. Here’s what happens: NOTHING. We keep getting new versions of Reason, RE’s, and things move along.
Nothing to see here, folks. Relax.
Last edited by Goodbye on 16 Mar 2018, edited 1 time in total.
31% profit in 2016. Most companys hang around between 10-15%, only uber companies like Alphabet have more than 20% or Apple with all their disciples.
Reason12, Win10
But 5% of a massive amount is still a massive profit. For Propellerhead it looks like they made 31% of a tiny amount.
I don't understand how you have taken that from the discussion. Has anyone said anything about wanting them to fail?
Having issues with the company and how they are handling things is not the same as wanting the company to fail. It is OK to love Reason but also be frustrated by the current direction.
Last edited by Goodbye on 16 Mar 2018, edited 1 time in total.
Before you judge how "big" a company is, check other companies in the same market. Considering the turnover they probably sold more than 50,000 new licenses or upgrades plus revenue from RE sales.
And btw, how much profit do you have for your money atm? 0% or maybe 0.5%? Considering your comment, you probably should have something about 300% or you need to be billionaire.
Reason12, Win10
Fair enough. I guess in the market they are in it's a pretty tidy profit.Loque wrote: ↑16 Mar 2018Before you judge how "big" a company is, check other companies in the same market. Considering the turnover they probably sold more than 50,000 new licenses or upgrades plus revenue from RE sales.
And btw, how much profit do you have for your money atm? 0% or maybe 0.5%? Considering your comment, you probably should have something about 300% or you need to be billionaire.
I don't think so, but I gotta admit that combination of aggressive sales / discounts and their apparent reluctance to upgrade the core product MIGHT seem like an effort to generate as much profit as possible in short-term, accepting the possibility it might not be sustainable in the future.
Like the recent $99 offer for Essentials owners - many of people taking it don't even use Reason, they just got Essentials some time ago with a MIDI controller or bought it out of curiosity, but now - on top of paying $99 - might be tempted to spend more on REs, Refills, etc. This doesn't cost Props a thing, since most of those users weren't active anyway and wouldn't upgrade or buy 10 at regular price.
So the question is how will they use that 31% profit - is it for the investor to recoup their investment, or will it go towards R&D?
That is the right question imo. But we can only speculate. I guess the next update or release will tell us the direction, especially "when" it will be released. And all those points must not contradict each other.
Reason12, Win10
Allihoopa seems to be doing fine. Yamaha just got on board. http://www.synthtopia.com/content/2018/ ... -features/
- EnochLight
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They're also actively hiring, which does not occur when a company is "in trouble".QVprod wrote: ↑16 Mar 2018Allihoopa seems to be doing fine. Yamaha just got on board. http://www.synthtopia.com/content/2018/ ... -features/
https://allihoopa.com/jobs
Win 10 | Ableton Live 11 Suite | Reason 12 | i7 3770k @ 3.5 Ghz | 16 GB RAM | RME Babyface Pro | Akai MPC Live 2 & Akai Force | Roland System 8, MX1, TB3 | Dreadbox Typhon | Korg Minilogue XD
- esselfortium
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Allihoopa isn't part of Propellerhead anymore, so its success or failure is probably insignificant to Reason's future.
Sarah Mancuso
My music: Future Human
My music: Future Human
I'm confident Propellerhead's programmers aren't sitting in the office all day juggling paper clips.
You would not think they've spent 3 years since Reason 8 by looking at R10, but maybe they're working on a complete GUI overhaul behind the scenes. Or maybe they're developing a successor to Reason to bring us a new music creation experience.
Who knows.
As for their financials, I'm with EnochLight.
Personally I'm a fan of birth and death rather than continued evolution and self preservation. In 50 years time Propellerhead (if it still exists) will be comprised of people completely disconnected with its origins, and may have had to make decisions to make money at the expense of some other fundamental quality, such as catering to the needs of a small niche of dedicated knob tweakers and wire pluggers (I'm looking at you, ReasonTalk members).
Trying to continue developing a product can stiffle innovation within a team as your decisions have to resolve conflicts between potentially new features and directions against the values and needs originally catered for.
You would not think they've spent 3 years since Reason 8 by looking at R10, but maybe they're working on a complete GUI overhaul behind the scenes. Or maybe they're developing a successor to Reason to bring us a new music creation experience.
Who knows.
As for their financials, I'm with EnochLight.
Personally I'm a fan of birth and death rather than continued evolution and self preservation. In 50 years time Propellerhead (if it still exists) will be comprised of people completely disconnected with its origins, and may have had to make decisions to make money at the expense of some other fundamental quality, such as catering to the needs of a small niche of dedicated knob tweakers and wire pluggers (I'm looking at you, ReasonTalk members).
Trying to continue developing a product can stiffle innovation within a team as your decisions have to resolve conflicts between potentially new features and directions against the values and needs originally catered for.
The worst thing a company can do is try to reinvent their wheel, unless that wheel is broken and no one cares about it anymore.
I feel its taken far too long for Propellerheads to address what many want from Reason, and certain decisions that actively step on RE Dev efforts haven't helped at all, nor has Props continued lack of useful interaction with their base.. However also believe an instant turn around can be made with some genuine energy towards those DAW improvements, a resurgence of dedication to the REdevs, and a voice or two occasionally with their users that shows an interest in what they have to say.
But you have to go by hard-fact track record, and I don't see anything changing. No one wants Props to fail, we all love Reason, we're spending our time actively making suggestions to help, but its Props decision on direction and their bed they have to lay in.
I feel its taken far too long for Propellerheads to address what many want from Reason, and certain decisions that actively step on RE Dev efforts haven't helped at all, nor has Props continued lack of useful interaction with their base.. However also believe an instant turn around can be made with some genuine energy towards those DAW improvements, a resurgence of dedication to the REdevs, and a voice or two occasionally with their users that shows an interest in what they have to say.
But you have to go by hard-fact track record, and I don't see anything changing. No one wants Props to fail, we all love Reason, we're spending our time actively making suggestions to help, but its Props decision on direction and their bed they have to lay in.
Reason needs to DAW.viewtopic.php?f=6&t=7504985
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I hope Ryan picks up that cue for his next video
Verdane own 60% of Propellerhead. What you're seeing right now is textbook. They're investors - they want a good return on investment. Once they've nurtured Propellerhead for a short period of time (3-7 years), they're going to SELL them off to who knows who. This is what Verdane does. Propellerhead are not in "trouble" at the moment. Reason 9 generated record sales for them. Now they're aggressively growing the user base. It's no secret they're going to focus on mobile. Not saying that's going to be Reason mobile, but it WILL be something huge from and for them, but they'll continue to support Reason because Reason is their core product (right now).
The only thing I'm concerned about is who's going to buy Propellerhead after Verdane are done with them. Because that's 100% going to happen. Well, either that or they go broke. We have a few years left though so enjoy it while you can.
The only thing I'm concerned about is who's going to buy Propellerhead after Verdane are done with them. Because that's 100% going to happen. Well, either that or they go broke. We have a few years left though so enjoy it while you can.
Not sure where all this doom and gloom is coming from. Unless you see sales figures that say otherwise, Propellerhead is doing just fine. The reviews on Reason 10 are mostly positive. That’s not to say that every move they make is the greatest. For instance slow sdk development has hurt RE significantly, but clearly that isn’t killing them.
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