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STRATACACHE Acquires Scala–Industry Analysis - AvNetwork.com

STRATACACHE Acquires Scala–Industry Analysis

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The August 15, 2016 announcement by Dayton-headquartered STRATACACHE of its acquisition of Scala, the high-profile digital signage software supplier is good news for end users, providers of the place-based media and the industry at large.

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Lyle Bunn
STRATACACHE operates over 1.5 million software and appliance installations for more than 425 end user organizations including Wal-Mart, McDonalds, Lowes, AT&T, H&M, Huntington Bank and many others. It has acquired and integrated other businesses such as PRN, Optika, Carmanah Signs and most recently intellectual property from VertiGo and Civiq into its increasing capabilities, and has been strengthened by the addition of deeply knowledgeable personnel. STRATACACHE has 18 corporate locations in North America with others in Europe, Asia and Australia. It has 5 development, 4 hosting sites and 3 network operations centers. STRATACACHE has served end users in direct supply and operates with a comprehensive support model.

Scala has a similar 25-year longevity, working with more than 500 partners in 100 countries to operate more than 500,000 displays. Scala’s strength has been in working with channel partners including integrators and distributors while assuring no channel conflict on situations where it would work directly with the end user.

STRATACACHE’s corporate health, deep engineering, operating, analytics and client service in its direct sales model and its experience in serving generally larger deployments of place-based media, is an excellent compliment for Scala with its channel strategy and a base of installations that can reasonably be expected to expand based on astute application of the media and ongoing developments.

This consolidation of capabilities enables better service of needs on the global stage through the combined strengths of these preeminent suppliers, each of which has been central to digital place-based media application and advancement. In STRATACACHE’s augmenting of its direct supply model with supply through channel partners and integrators as used by Scala, STRATACACHE will move the industry's supply capacities to new levels. Current users of Scala will benefit from a deeper knowledge base and improved corporate stability.

In past acquisitions, STRATACACHE has empowered the acquired business unit while allowing them to operate entrepreneurially bringing subject matter expertise and active support to vertical market clients. It could reasonably be expected that Scala operations will be treated in the same way.

Innovation is a demonstrated priority of STRATACACHE as indicated by its ongoing developments in areas such as content strategy and composition, analytics, omni-channel, hardware price/performance improvement, display enclosures, tablet and mobile interactivity, anonymous audience detection and identification, traffic tracking, gestural interaction, augmented reality, human vision replication and other areas of digital media areas.

So, end users seeking location-based media innovation and the engineering and customer support teams of the two providers will benefit from the merging of innovation programs. And it could be entirely expected that innovation partners of Scala will be welcomed into the bigger sandbox.

Dot2Dot Communications of Toronto for example, acts as Scala Canada. As an independently owned and operated partner Dot2Dot has developed the Ad Manager overlay for Scala. It only operates with the Scala CMS and Dot2Dot’s ad management capabilities are introduced to end users by Scala and other partners where third party advertising or sponsor revenues are an element of the digital signage business model.

The combination of STRATACACHE’s system capabilities to handle in-store promotional spending and campaigns in large retailers (like Wal-Mart) and the Dot2Dot/Scala partnership bodes well for network operators and end users.

The integration of Scala into STRATACACHE operations offers end users an improved entry and migration path in their use of digital place-based messaging and engagement capabilities.

The acquisition of Scala by STRATACACHE provides a substantially stronger base of supply from the standpoint of functionality options, alternatives and scalability.

Consolidation of supply reflects the next natural stage of organic digital signage industry growth and positions the sector for greater contributions media commerce and the economic success of enterprises, industries, countries, regions and countries. As the pace of technology application accelerates for benefits "in the now,” strength of supply, as reflected in this acquisition agreement is a critical success factor.

The accelerated application of digital signage and overall industry development will benefit all. In short;

End users will gain a broader and stronger supply option from the expanded STRATACACHE family of providers. The harmonizing and consolidation of research, development, innovation and best practices will accelerate use cases and standards of practice. The struggle of provider sourcing can be streamlined allowing end users to get on with the gaining the benefits of the media. Firms competing with STRATACACHE and Scala will “up their game” in the face of this combined supply capability.

This acquisition puts me in mind of The Jungle Book story that many parents have read to their children and is the subject of another recent movie version.

It's a jungle out there for retailers, brands and others. But like Mowgli (the jungle boy) who is protected, developed and supported by the panther Bagheera, (representative of the fiercely competitive but somewhat private and elusive STRATACACHE) and a big bear named Baloo (representative of Scala), end users have been in good hands. Their combined contributions equip Mowgli to stand against King Louie who wants to be all-powerful (let’s call this online commerce). The Jungle becomes a better place, just as place-based media through capable champions can do.

Integrators and other channel providers will have access to broader capabilities and a growing market for the medium. Scala partners and proponents will benefit from the broader feature set and stability of supply offered by this acquisition.

Consolidation has not been expected as a needed feature of and for industry expansion. Sales (for suppliers) and acquisition (for end users) costs have hampered industry growth, detracting from investment on innovations that can significantly advance the use of place-based customer experience and engagement technologies. Technology providers such as IBM, Microsoft, HP, Cisco, Harris Corp, 3M and Google have made splashes in the digital signage lake, but without the significant, long-term implication or impact that large and institutional investors seek.

This acquisition of Scala by STRATACACHE is a giant step forward for digital signage and place-based media. More consolidation and expansion can be expected, on the basis that the medium simply makes business and economic sense through the enterprise and value that it delivers.

John F. Kennedy said “ask not what your country can do for you, ask what you can do for your country,” as a reminder that value in service is the only basis on which progress can occur. In the 1600’s Martin Luther launched the reformation by challenging “indulges” and institutional authority.

The consolidation of STRATACACHE and Scala as the major industry providers signals that the time is come for digital location-based media to reach new levels of enterprise and economic contribution.

Lyle Bunn is an industry analyst, advisor and educator in North America's digital signage and place-based media industries. The past 14 years of his 40-year technology career have been entirely focused on digital place-based media. Bunn has advised hundreds of end user organizations in shopper, patron, guest, traveller, staff and student communications to plan, design, source, operate and optimize their digital messaging and engagement media. Bunn (www.LyleBunn.com) serves as a BrainTrust commentator of RetailWire, Adjunct Faculty of InfoComm International, on the Consultant Advisory Council of Digital Signage Expo and in other industry advisory and award judging panel capacities.

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