May
1
Written by:
Paul McLane
5/1/2012 1:24 PM
Paul McLane is Radio World U.S. editor in chief.
So Harris has put its broadcast communications operation up for sale. Look for lots of speculation about who will take that business on, as well as questions about what the sale says about the industry.
Who will step up to buy? What price will Harris get? We’ll see. But certainly, given the deep roots of Harris in the broadcast community, this marks the end of a chapter in broadcast technology. As the company says on its website, “Turn on a television or a radio almost anywhere in the world. Chances are excellent that the signal you receive is being broadcast with hardware from Harris Corp.’s Broadcast Communications Division.”
While I can’t say I saw the decision to sell coming at this time, I was not really taken aback. Anyone in broadcast tech who has been paying attention knows that the big parent company had many priorities and that broadcast seemed to take a lower profile than in the past. Harris sold off its distributor business (the old Allied part of the company) five years ago, and in 2011 it realigned its structure so that broadcast became part of something called Integrated Network Solutions.
From my perspective, reading Harris quarterly financial reports and talking to industry insiders, the company — hungering as all public companies do for consistent growth and investor returns — has been challenged by the relatively mature yet volatile commercial broadcast manufacturing sector, particularly when compared to the government businesses on which Harris relies. Nor is Harris alone in this challenge among transmitter companies; but the company’s size tends to pull the spotlight toward itself.
So the development is understandable. Nevertheless, the news hit a lot of industry folks with a jolt today.
Harris’ history touches on some of the most familiar names in early broadcast hardware manufacturers. Its involvement in broadcast dates to the purchase in 1957 of Gates Radio by Harris Intertype Corp., according to the company’s website. Gates had been founded in 1922 in the earliest days of commercial radio; it was the first electronics firm acquired by what would become Harris Corp.
Harris entered the TV transmitter market in 1969. It would later acquire Allied Broadcast Equipment Corp., Intraplex and Pacific Research & Engineering (PR&E), an iconic name in consoles. Later acquisitions included TVT, part of Midwest Communications Corp., ITIS, Louth Automation, Hirschmann Multimedia Communications Network, Question d'Image, Encoda Systems, Leitch Technology Corp., Aastra Digital Video, Optimal Solutions Inc. and Zandar Technologies.
When you talk to buyers of big broadcast components, most notably transmitters but also consoles and STLs, the conversation sooner or later turns to Harris, at least in radio where my personal experience lies.
Many broadcast stations are loyal Harris users. I heard from one West Coast cluster this morning that owns 10 Harris transmitters; and that doesn’t strike me as particularly unusual. Users with this kind of investment have a keen interest in continuity at a key source vendor, and feel a personal relationship with the factory. Suffice it to say that a lot of users will watch and hope that any new buyer is serious about the business and committed to supporting the Harris lines.
Harris officials tell us today that their business remains sound, that the company is in a good position and that there are no changes in management or employee levels; for now the only real change is that broadcast will report its fourth quarter earnings separately. The planned sale, they emphasize, came about because broadcast no longer fits into their long-term vision.
That can all be true; yet it's my experience that companies tend not to exit industries they feel are strong and growing, so the question also arises whether the broadcast transmission and studio market in general is still worth investing in.
I believe the answer is yes, given the sweeping changes and opportunities that continue to affect all media. But I’m also aware of challenges facing some other transmitter and studio manufacturers, and I know that the answer about the health of the industry would vary for any given company and in any given circumstance.
Perhaps we are coming into a period of greater volatility among familiar broadcast brands. That’s speculation on my part. What is not speculation is that, more than ever, well-run, solid suppliers are vital to the successful growth of broadcasting companies.
In their search for a buyer I wish Harris and its employees well, as I do all companies that support our industry with investment in infrastructure and employment. I hope that the company finds a buyer that is not only strong and savvy but committed to our historically rich, ever-evolving broadcast technology marketplace.
12 comment(s) so far...
Re: What Next for the Harris Broadcast Biz?
Thank you for a well-written and thoughtful column, Paul.
By Brian Galante on
5/1/2012 1:59 PM
|
Re: What Next for the Harris Broadcast Biz?
How sad to think Harris has decided the broadcast industry no longer fits their business model. I am retired after 33 years at BCD and have many friends still employed at the facility here in Quincy. Hopefully a new owner will continue the tradition of quality and inovation so long a part of BCD and the industry.
By mick9q on
5/1/2012 2:42 PM
|
Re: What Next for the Harris Broadcast Biz?
BE also shows signs of probems in a slow economy. Some decent broadcast investment people should look into purchasing both companies, consolidating facilities, keeping the best products of each company and move on. That is what we have done in the radio broacasting business. Why not in the manufacturing side also? They are only a short distance from each other.
By Vetman03 on
5/2/2012 6:16 AM
|
Re: What Next for the Harris Broadcast Biz?
Reminds me of the RCA and GE Broadcast Division sales many years ago and this helped to make Gates Radio/Harris and others a much stronger force in our Broadcast Industry in later years.I look forward to another similiar Leader to come forth in this GREAT WW Broadcast Industry and be part of the future for BROADCAST.
By Tom Yingst on
5/2/2012 6:16 AM
|
Re: What Next for the Harris Broadcast Biz?
A lot of history has been let go by Harris which is sad really. On the other side it could be an excellent new chapter for everyone within the division and for the broadcast industry. A new owner will likely be more focused, driven and committed to the continued success and quality of the company.
By ZB4A on
5/2/2012 6:16 AM
|
Re: What Next for the Harris Broadcast Biz?
Great blog. Overall...shocked. I resell the product line. I had the opportunity two years ago to tour the Corporate Melbourne facility. My big question prior to the Harris Corporate tour was how the different products ranging from scopes, routers to signage and asset management all fit together. Harris showcased in a large showroom their entire product line. Viewing the Defense and Government solutions, I saw the synergy and became a huge proponent about the technology being leveraged across the overall corporate entity. My concern is whether the stand alone business can exist without the leveraged divisions sharing technology?
The other concern would be what type of buyer would be able to take on Harris Broadcast? The Sony & Panasonic side have too great amount of losses. Avid...not a run rate of profit with a low share price, don't think so. Evertz? they could use the server, but lots of overlap. A financial buyer, not enough profit in present model. Hybrid with a finance organization ie"Grass or Telestream, unclear on the business model.
By Mike Cavanagh on
5/2/2012 6:16 AM
|
Re: What Next for the Harris Broadcast Biz?
The buyer of Harris Broadcast should bring back the Gates name. For many years Haris transmitters had the Gates name inside to prevent anyone else from using that name.
By Fred Krock on
5/2/2012 1:46 PM
|
Re: What Next for the Harris Broadcast Biz?
If you're age is nearing 'half a hundred', then you've for sure seen at least one Gates console or beastly transmitter at your station. I hate to see it go. I was impressed with the quality of their version of AM stereo - CKLW had better than FM stereo quality on 800AM back in the early 80's. I hope that someone can merge Harris into their company to continue their tradition of groundbreaking high-quality hardware.
By John Pavlica on
5/2/2012 2:33 PM
|
Re: What Next for the Harris Broadcast Biz?
i worked for leitch and then was purchased by harris. The questionable business practices of harris and they way they treated their employees in bcd was/is horrible. I for one am glad that it has not worked out for them.
Leitch had solid products and was an industry leader.. it did not take long for harris to destroy the product line through power selling and limited r&d.
By HARRY JOHNSON on
5/3/2012 7:15 AM
|
Re: What Next for the Harris Broadcast Biz?
As a retired, ~20-year sales/FM applications engineer of Harris Broadcast Division still living in Quincy, this announcement is painful to me.
I have a lot of empathy for the anguish that this public announcement must be producing for the current employees of Harris Broadcast.
My hope is that at least the part of the Harris Broadcast Division that manufactures AM/FM/TV transmitters will be acquired by a single, corporate
or private entity with management skills showing proven, long term, and successful experience specifically in the broadcast transmitter marketplace.
This excludes owners/principals/upper-level managers with education/experience in "how to manage a generic business," as taught in universities (however prestigious).
History has shown that such educational/experiential backgrounds do not lead to long-term success for the broadcast-oriented organizations where individuals with such backgrounds have been, or are still employed.
RF
By Richard Fry on
5/3/2012 7:15 AM
|
Re: What Next for the Harris Broadcast Biz?
Well, "The Drug Dealers" in Florida have accomplished what they've alway's wanted, to get rid of the BCD...
Corporate has refused to pay attention to the Quincy operation for years now. After Mason was closed, the 'writing was on the wall'.. The lavish, wreckless spending of the pentagon, supports the 'elitist' management in Melbourne. They have been spoiled by all the 'easy money' flowing from the government and don't really want to 'work' for a living anymore. That's why they are dumping the BCD.....Truth hurts, but that's the truth !
By George J on
5/12/2012 4:18 PM
|
Re: What Next for the Harris Broadcast Biz?
I'm sorry to see that happen. I cut teeth on a Gates BC1-F back in the 70's. I hope they don't wind up in the same malaise as Continental Electronics, building fine equipment for management who would only be too quick to hand them off to the next guys with cash.....
By Yitzahk Deguelo on
6/11/2012 3:02 PM
|