Q4 2021 SeaChange International Inc Earnings Call
[music].
Good afternoon, and welcome to see changes fourth quarter and fiscal year 'twenty 'twenty One conference call for the period ended January 31, 2021. My name is Hillary and I will be your operator, this afternoon and joining us from the company as executive Chairman, Robert Pons, Chief Financial Officer, Michael <unk>, and senior Vice President of global sales and marketing.
Chris Clemmer.
After the market close today, the change issued its financial results for the fiscal fourth quarter and full year of 2021 and a press release, a copy of which is available and the investors section of the company's website at Www Dot C change dotcom.
Before we begin today's call I would like everyone to please take note of the Safe Harbor paragraph that is included at the end of today's press release.
This paragraph emphasizes the major uncertainties and risks inherent in the forward looking statements that management will be making today.
As indicated forward looking statements are based on management's current expectations and are subject to a number of risks and uncertainties that may cause actual results to differ materially from expectations.
These risks and uncertainties are also outlined and the Companys SEC filings, including its annual report on form 10-K, and quarterly reports on form 10-Q any forward looking statements should be considered in light of these factors. Additionally, this call contains certain non-GAAP financial measures as that term is defined by the SEC and regulation G. <unk>.
Non-GAAP financial measures should not be considered in isolation from or as a substitute for financial information presented in compliance with GAAP.
Accordingly, the change has provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures and the company's earnings release issued today.
To remind everyone that this call is being recorded and will be made available for replay via a link available and the Investor Relations section of the sea changes website now I would like to turn the call over to see changes the executive Chairman Robert Pate and Sir. Please proceed.
Thanks, operator.
Good afternoon, and thank you for joining our fourth quarter and fiscal 2021 conference call. It is great to have this opportunity to speak with you today.
Joining me is our CFO, Mike print and our new senior Vice President of global sales and marketing Chris Clemmer.
I would like to start off by sharing with you a statistic that recently within an article and the Wall Street Journal.
According to the motion Picture Association the number of subscriptions the video streaming services around the World reached 1.1 billion in 2020.
We see change all of a company that is squarely in the middle of this explosive growth and video streaming.
We have the technology and experience to provide cable operators and content owners throughout the world to enable video streaming for their films TV shows or live content.
Our streaming technology brings our customers and end to end solution with a strong monetization component for both subscription and advertising business models.
While navigating through the last 12 months during the pandemic has not been easy for our company and our shareholders.
However, the last 90 days has been a turning point for our company.
And I had been busy meeting with customers and employees every day since I jumped into the role of executive Chairman.
As you have read we have significantly improved our balance sheet with our recent public offering.
We have completed and now have over 22 million and cash.
Now I would like to share with you what has been happening at sea change over the last 90 days since I was appointed executive Chairman.
Our team has been laser focused on aggressively implementing.
Our strategic roadmap, which has created a much more focused and capable organization.
At a high level the initial phase of our strategic roadmap has involved three key initiatives first enhancing our go to market strategy to position see change as the leading enabler of video streaming services, the cable companies and content owners.
Throughout the world.
Second refining our business model to better monetize the value of sea changes software and services and drive a greater.
Rois for our customers.
Third strengthening the team with key appointments technology veteran Matthew Stecker to our board and the promotion of Chris Clemmer to senior Vice President of global sales and marketing.
Our early execution against our strategic roadmap is reflected by not only the sequential improvements and our top and bottom lines as Mike will discuss shortly but also the major customer wins, we have recently secured.
This included the new multiyear multimillion dollar contract, we secured with our long standing customer who was one of the largest broadband service providers in the U S.
More broadly as strategic initiatives have also enhanced our technology platform and go to market strategy to better align with the worldwide explosive growth and over the top or OTT streaming services demand during the pandemic.
Our continued and consistent execution of our strategic roadmap will drive scale capture market share and create even greater value for both of our customers and shareholders.
I'll now turn the call over to Mike to walk you through our numbers for Q4, then Chris will discuss our sales and marketing initiatives and the traction we are achieving in the market.
Afterwards, I will share our outlook and then open the call to questions.
Mike.
Thanks, Bob and good afternoon, everyone as.
As Bob described the changes business and focus today is very different than it was a year ago for this reason I'll focus my commentary on the fiscal fourth quarter of 2021 and the prior quarter comparison.
Now turning to our financial results.
Total revenue for fiscal Q4, 2021 increased 3% the $5 1 million.
Compared to $5 million and the prior quarter.
The increase in revenue was primarily due to an increase in product revenue offset by a decrease and legacy maintenance revenue.
Product revenue for fiscal Q4, 2021 increased 33 per cent to $1 4 million or.
Four of 27 per cent of total revenue compared to $1 million or 21% of total revenue from the prior quarter.
Service revenue for fiscal Q4, 2021 decreased 5% to $3 7 million.
Or <unk> 73 per cent of total revenue compared to $3 9 million or 79% of total revenue and the prior quarter.
The decrease and service revenue was primarily due to a decline and legacy maintenance.
Revenue from our international markets and fiscal Q4, 2021 was $3 7 million or <unk> 73 per cent of total revenue, which compares to $3 6 million or 72% of the total revenue and the prior quarter.
Revenue and our U S market for fiscal Q4, 2021 was $1 4 million or 27% of total revenue, which compares to $1 4 million or 28 per cent of total revenue and the prior quarter.
Looking at our margins gross profit for fiscal Q4, 2021 increased 2% to $2 8 million or 55 per cent of total revenue compared to $2 8 million or 56% of total revenue from the prior quarter.
Product gross margin for the fiscal fourth quarter of 2021 was 46 per cent compared to 58 per cent from the prior quarter.
Service gross margin was 59 per cent compared to 55 per cent from the prior quarter.
Okay.
Looking at our expenses non-GAAP operating expenses for the fiscal fourth quarter of 2021 decreased 3% to $6 4 million from $6 6 million and the prior quarter.
GAAP loss from operations for fiscal Q4, 2021 totaled $4 4 million and improvement of 132000 compared to $4 6 million and the prior quarter.
As a percentage of total revenue GAAP loss from operations for the fourth quarter of fiscal 2020 one.
And was negative, 87%, which compares to negative 92% and the prior quarter.
Non-GAAP loss from operations for fiscal Q4, 2021 totaled $3 5 million or a loss of nine cents per basic share and.
The improvement compared to $3 8 million or a loss of 10 cents per basic share and the prior quarter.
As a percentage of total revenue non-GAAP loss from operations was negative <unk> 69 per cent compared to negative 76% and the prior quarter.
GAAP net loss for fiscal Q4, 2021 totaled $4 4 million or a loss of 12 cents per basic share. This was an improvement compared to net loss of $5 1 million or a loss of 14 cents per basic share and the prior quarter.
Non-GAAP net loss for fiscal Q4, 2021 totaled $3 5 million or a loss of nine cents per basic share.
Two of net loss of $4 3 million or a loss of 12 cents per basic share and the prior quarter.
Turning to the balance sheet on April 1st we strengthened our balance sheet by issuing 10 3 million shares of common stock for total gross proceeds of $19 1 million.
The offering was priced at a dollar of 85 per share which was above the five day average closing price of $1 26 per share.
In addition, we granted the underwriters and option to purchase an additional 15 per cent of the common stock offered from the public offering solely to cover over allotments, if any exercisable for 45 days after the closing of this offering.
If the additional stock has exercised this would bring total gross proceeds to approximately 22 million.
As of today, we have more than $22 million and cash and cash equivalents, which provides us with sufficient runway and flexibility to execute our growth strategy.
This completes my financial summary for a more detailed analysis of our financial results. Please refer to today's earnings release as well as our 10-K, which we plan to file by the end of the week Chris.
Thanks, Mike.
The sea change as SVP of global sales and marketing my focus is on aligning our technological strength and go to market strategy.
And we've not only of the industries today, but also where the industry standard over the next five to 10 years.
He changed has an incredibly rich history of technology innovation.
We listed and award winning products and continue to invest in R&D to deliver outstanding solutions, using our breast and free technology.
Despite the massive changes that have occurred and the broadcast industry since the onset of Covid streaming services of prosper.
In response to the changing industry landscape, we adapted and modified out of the car technology portfolio to address the growing needs of cable providers and content owners to quickly and seamlessly deliver dynamic live and Vod streaming services.
With over 150 in House video software engineers dedicated to developing fee changes technology platform, our innovative software solutions and empowering cable companies like throughput of the carbon as well as content owners, such as West Coast digital services to seamlessly manage and deliver and monetize their content.
And the case of West Coast Digital services and in calendar 2020, we hope the launch of device agnostic direct to consumer video on demand service with premium content from all major studios under the brand.
Our solutions to put the unique business model of selling redeemable movie carts for digital movies, and Tesco retail stores and the U K debt.
The edible streaming on all devices.
This is a great example of how our technology provides the customer microscopes digital with an end to end solution that spans content processing use of management monetization and payment to the end user sales and client types.
Today more than 80 customers globally rely on also true solutions and professional services to orchestrate the delivery of content to all screens and devices.
In addition to dynamic content delivery and management requirements, we are seeing a growing need across the industry for technologies like our analytics engine to generate valuable and actionable insights to optimize and user retention and monetization.
C change is very well positioned to enable the customers OTT streaming service with the full suite of offerings, including advanced analytics to report business Kpis monetization tools, such as an advertising and search and technology and client application and reaches and users on all the major device platforms.
The enhancements to our go to market strategy and business model have already produced encouraging results, including the customer centric sales motion and that has deepened and expanded customer engagements.
The power of example of this is the recent multiyear multimillion dollar deal we secured with our longstanding customer who as Bob mentioned as one of the largest broadband service providers and the United States.
For more than 15 years, our technology has enabled this major brought and service provider to adapt to technological advances and the industry.
Under the new contract he changes working with the customer to move its infrastructure to virtual classroom, thereby reducing the operators hardware footprint and enabling higher the ability of service on top of this we will also facilitates greater monetization of the customers see the service offering by leveraging our technology to improve the management.
All of its answers through remote operating system installations and hardware health management.
Long standing customers like this major of broadband service provider continue to expand use of sea changes technology and are increasingly benefiting from all of that from RF technology that facilitates cross platform and dynamic advertising solutions for cable and IP video delivery.
And this major win which combined license and service components marks one of the highest average annual guidance of any north American contract and more than two years.
The win also exemplifies our refined go to market strategy and holistic approach to selling the full value for software and services and further demonstrates the sea change his role as a trusted partner to the world's most prominent video providers.
The increasing value of our technology is providing two leading cable operators and content owners demonstrates the changes elevated value proposition and critical role and the industry.
As an enabling technology C change effectively serves as a conduit to facilitate the delivery of video content to end users globally. In addition to the expanding customer relationships. We are also expanding and deepening partnerships as well along that line, we strengthened our partnership with Amazon Web services or AWS to enable.
Enhanced data analytics on top of of fully migrated video delivery platform and the cloud.
Building on the partnership the dates back more than five years Sea change Leverages Aws's artificial intelligence and machine learning platforms to facilitate a robust understanding of and user engagement and improved customer business outcomes.
Our customers will be able to easily deploy machine learning use cases, like predictive maintenance computer vision and predictive customer behaviors.
We now give our customers even greater insights into the end user behavior and allow them to automatically convert those insights into meaningful recommendations how to effectively target the end user with relevant content and personalized promotions.
That concludes my prepared remarks, I'll now turn the call back over to Bob for his closing remarks Bob.
Thanks, Chris.
Our building sales momentum validates the effectiveness of our refined go to market strategy and our holistic approach to selling the full value of our software and services to the world's most prominent video providers.
The increasing value of our technology platform is providing to video and broadband providers globally demonstrates see changes elevated value proposition and increasingly critical role and the industry today.
Today see changes position at the at the center of the video industry transformation to OTT video streaming services and delivery to the billions of the end users globally.
It was a transformative period for our business and the World. We finished the fiscal year strong and entered the new fiscal year with tremendous momentum.
<unk> us well to our near and long term growth goals.
While we are still and the early innings of our strategic roadmap.
I can confidently say that the sea change of today is a much stronger and more capable organization and that the future has never been brighter.
Our successful capital raise has not only provided the necessary resources to accelerate our plan, but it is also elevated C changes standing among our customers and partners alike.
With more than $22 million of cash on our balance sheet, we have the resources to accelerate many key initiatives with our strategic roadmap and eat and better capitalize on the exploding growth and the video streaming marketplace.
Overtime, we expect the successful execution of our plan will translate to sustainable growth and consistent profitability in the years ahead.
That concludes our prepared remarks, we are ready to open the call for questions.
Operator.
Okay.
Thank you at this time, we'll be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad. The confirmation tone will indicate your line is and the question queue. You May Press Star two if you would like to remove your question from the queue for participants using speaker equipment and it may be necessary to pick up your handset before pressing.
And the Starkey one moment, please while we poll for questions.
Yes.
Yeah.
Our first question is from Steven Frankel of Colliers.
Please state your question.
Good afternoon.
Rob can we start with what were bookings in the quarter and.
And what's the revenue recognition policy around this new multimillion dollar multiyear.
The back office contract.
And Mike I can't Yeah, I can I can kind of start with that one.
So I'm, we're not going to disclose bookings on a quarterly basis I think we gave enough color with revenue and I think we've talked about the bookings teach.
Kind of being bumpy, so I think from a reporting perspective, we're gonna slip to revenue.
And in terms of this deal.
It is a large deal and it's a little different so what I will say is it's got three.
Three different pieces to it.
It definitely has a professional services piece of it.
It has the maintenance piece and that's of a large a piece of the multimillion dollar contract value and that will be spread out ratably. The.
Professional services are probably six month period, and then there is the piece that is.
Our license piece. So this will.
The b. Unlike what we used to call of typical framework deals, which was 60% revenue upfront. This one's probably has the majority of it.
Spread out over you know the.
The the three year term periods.
Okay, but the.
And the up so at this point you've recognized some professional services and then the idea would be.
You'd have that you would hit your milestones and and you'd start recognizing license is that ratable or when the when you get to the license piece does that all hit and a quarter or two and then maintenance starts at some point after the license.
So that's the thing.
<unk> Yep Yep this license will probably be it'll be.
A smaller piece, but it will be kind of of I think of lump sum payments from the potentially spread it over two quarters, depending on kind of implementation and of course as a reminder, you know this one was.
It was booked and.
And Q1, so it should be kind of Q1 revenue recognition.
Okay. So the professional services that we saw and this quarter are not related to the steel.
Correct.
Okay.
He is framework still of product Youre trying to sell today and did you do and your framework deals in the quarter.
Yeah, So again, I think where we're not going to kind of.
Reported the number of framework deals I think I'll, let maybe Christian and Bob can give a little color you probably won't hear of say.
The word framework as much.
Sorry in the streaming all of platform and our offering and I think we're trying to kind of understand what that looks like and you know we may change, how we speak about that and the future, but we probably you won't hear of six framework as much.
Chris do you want to share what some of your initiatives have been regarding you know what you're selling as opposed to just as Mike said of blanket statement of framework.
Sure Hey, Steven and good afternoon, and so the concept of the framework was based on the assumption that it makes sense to bundle and two one.
And basically of combination of services licenses and maintenance components.
We believe to be able to address the market more specifically and you know sort of of point solutions to both existing and new customers. It makes sense to split this out again and be more points and and and setting up of solutions. So we won't sell from the framework concept anymore.
If we're going to sell of enablement services to ensure that all customers content of operators and content owners.
Okay, well raised and content owners can launch successful and profitable stream services.
Yeah.
Okay, so and and what's the profile of the.
Content owner of that would come to you. Obviously the streaming is highly competitive and there are lots of companies that are larger than you with bigger balance sheets.
And that have customers and this market.
Who's going to come to you and why.
Well first the.
I don't know how much you.
Taking a look and how many content players that are coming onto the scene.
Just here in North America, but of all over the world.
So people who have film libraries people, who are producing TV show the outside the United States and their particular of audience some of them of bringing them to the U S marketplace. I mean, we're talking hundreds and hundreds if not thousands of people that are looking to jump in you know to.
The growth of stream.
We know where our sales force globally is is busy.
Speaking to the content on and again, you know slice and dice of you watch TV and you know how many different varieties of our of content that appeal to particularly.
Customers targeted segments and things.
My goodness.
And you know.
It's not just Disney and Netflix you know there is there are companies that are appealing.
The of family friendly T V is another so yeah. It is.
Is it a tremendous amount of opportunities out there for us.
And and what do you think of typical deal will look like for you and this mark.
So so if I may so first of all to you and obviously you know the every content owner of that we speak to the needs to have a constant proposition that is strong enough to attract a sufficient amount of users of subscribers dependent on the business model too low a solid business case right I mean, that's that's the given.
To your question why should they choose us because of the things you know based on the product and also the expertise of the holding the company based on the value of that we can provide to these content owners, what we can do and maybe do better than our competitors to make sure that the market entry barrier for these content owners of slow and the upside to turn into.
Profitability.
Is.
With the imminent.
We have a variety of tools to ensure that we can unlock revenue streams are when it comes to the monetization of content, but also when it comes to optimizing the way.
The business operation can be run based on big data analytics and.
We also have the capabilities with our cloud native technology.
Technology solution.
To keep the the.
Cost under control and ensure.
And that the cost is directly related to actual traffic, which in the return and will generate revenues. So I think with the combination of these factors and components.
Of course side on the one and you know keeping the cost under control and the Wuhan and on the other hand, allowing through various.
Components and various services.
To unlock revenues I.
I think we have and extremely strong proposition for these content owners to control.
Yes.
Oh, Okay, great. Thank you I'll jump back in the queue.
Thank you.
And.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad. The confirmation tone will indicate your line is and the question queue from.
Participants using speaker equipment, and it may be necessary and pick up your handset before pressing the star team.
One moment, please while we poll for additional questions.
Our next question is from ARIA Cole of Cole capital. Please state your question.
Thank you. Thanks for taking my question and for hosting this call just first question and I've been following the company for several years, if we go back and history.
Very simplistically, one would have said that the goal of to change or two was to grow revenues and the framework would be the primary driver of sales over a multiyear horizon.
And looking at your website right now could you maybe kind of identify the names of the products of solutions, you're going to be selling and the market now that you believe will be the primary drivers of your sales growth over the next two or three years.
So first of.
Our website is dated in terms of its look its feel you.
You know we've been doing many things and the last 90 days and it is not lost on us that its time for us.
To do something very different and a different look and feel.
So in terms of actually naming that some of the specific products and things I'll, let Chris talk to you again, you know more about some of the service offerings and things that we sell to both cable companies and the content and tone of those Chris.
Thank you Bob I'm, So I think what we need to move away from is the notion of selling product components and what we need to move towards is the notion of selling enablement services.
And these enable them and services are directly related to value that'd be provide to our customers.
Think about for example, you could call it of Ninja content ingestion services of content management service.
Where we make sure that the continent processed and accordance to the use case and it's supposed to and Sir where all of the metadata is normalized and the and ensures.
The content discovery you know it is.
It's been taken care of think of monetization services, ensuring that entitlement to products and content and content of being managed all of based on purchases of thinking about use of management services, where they make sure that the entire lifecycle of the use of journey all the way from registration to again and <unk>.
Items and you know getting content promoted is taken care of so I'd like to sort of change the paradigm of thinking and product components towards thinking in the neighborhood and services and ensuring that you know through this message to the value of the very very rich solution portfolio of that'd be half.
It gets communicated appropriately to our customers.
Okay, and Chris just a follow up obviously youre working with a new sales force and.
Unfortunately of the company you have to cut costs from the months just past could you give me a sense of how many sales people direct salespeople that were and maybe about six months ago and at what levels of Europe today and.
What the investment of hiring plans might be going forward regarding the number of salespeople.
So today, we work with obviously direct salespeople that are employed by sea change and we have sales offices and individual contributors across the globe.
All primary focus and that is traditionally and so and and we will continue to be so for for some time.
All of our three main regions, which is obviously North America.
Latin America and and email.
And beyond those three key regions and we also work with channel partners Channel partners can be you know agents resellers, but also the strategic partners technology partners that.
And that help us and create the appropriate reach and the necessary reach to also get engaged with our with the sales engagement.
And those those regions, if and when we will invest and for example, the presence in Asia Pac and which is an interesting market, but also difficult market venture debt is still being discussed.
Alright is it possibly just repeat the question I think it's reasonable to ask how many direct salespeople to worry about six months ago, what you've downsized.
And where.
Yeah, Yeah, let me, let him where you've gotten the information that we've cut salespeople and wherever you got and.
And anything live eyeballs and that yeah, I'm, just making an assumption from any corral, okay fine okay.
So let me correct you on your assumption our sales force is.
And the same sales force only reinvigorated some of them.
The strategic things that we put in place right now.
So I'm not sure where you focus it so if I may correct you our sales force is that.
Near capacity that it's been out for a while only now they're being read the practice of selling things that fit much more in line with our capabilities.
Okay understood and then in terms of the redirection I know you'd mentioned, how you've started the fiscal year on the strong note. The is it possible the kind of quantify that in terms of the dollar value of your pipeline versus maybe three or six months ago.
As an indicator of building momentum and the business.
Yeah. This is Mike Unfortunately pipeline and flow was and anything that we've shared kind of historically and not ready to share going forward.
We'll continue to give color on either specific.
Wins that we have and then most importantly, the different and revenue metrics that youll see every quarter.
Okay.
Overall, though Chris and sorry, it's probably important day, Chris feels very strong lead that he's got a healthy pipeline and he's got you know enough opportunities. He's got kind of the right sales team and he's working on enablement and execution.
Got it and and just to close here obviously, it's April 13th you've kind of your maybe what does the number of your 13 weeks until were 15 or 11 weeks and do a 13 week quarter more or less would you be comfortable kind of discussing how the quarters per.
Gross so far or are you in a situation, where just a lot of deals close here and the last two weeks. So it's best not to say anything for now.
Yeah. It's you know we still do have the model, where we have a lot of activity at the end of the quarter and we're all sort of point, where you know we haven't really provided kind of quarterly or annual guidance. So I would just say that we're very optimistic but we obviously still have a couple of crucial weeks the finish up Q1 and because it takes it takes us a while the report year end.
We'll be back and.
And it's one of everybody probably and another 60 days with some coupon and results.
And it's this really of the final question.
Regarding your your.
Your stronger balance sheet today, you indicated how youre going to be accelerating some of your projects and investments within the company, which would suggest at least near term you might be losing more money because youre investing which probably is the why is the idea can you kind of give us a sense for assuming you were able to invest.
As you see fit I guess, how much lower you think the cash balance sheet. The cash on your balance sheet might decline over the next 12 months.
No. We haven't we don't provide that type of guidance you know we just.
Well, we just received the the cash as you know and.
And you know we're also looking at some strength.
P J the opportunity there's so many things that you can imagine and and.
And it hasnt been long since our balance sheet has been shored up so.
The answer is yes.
We don't provide that guidance, we're not if we even.
Even if we did we wouldn't be ready to do it now.
Okay understood and wasn't I wish you the very best of luck here going Thank you and the bank.
Sure.
And your question.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad. The confirmation tone will indicate your line is and the question queue.
All participants using speaker equipment, and it may be necessary to pick up your handset before pressing the star of Q.
One moment, please while we poll for additional questions.
Our next question is from Gregory attached the angle of the International Service Agency. Please state your question.
Thank you for taking my question and for having this call.
This was briefly touched on before I was wondering will see change international keeps shareholders up to date regarding the new contracts and.
And theres coming up or one of the shareholders have to wait until the next earnings report ex.
Of course.
Gregory of.
Good question and we're going to you know.
We put out of couple of the press releases recently as hopefully you have seen.
And we Wanna be is.
Communicate of transparent.
Company and as you know you might invest and so we will you know as soon as we have something.
Debt, we can get of release out.
And a new large customer wins and strategic partnerships something new that we developed and our technology anything at all.
Big Communicators and I promise you that we'll do our best and can get get those that news out to you as soon as we can.
Put it together and get it out.
Alright, that's great. Thanks for answering my question.
Thank you for it.
Yeah.
Our next question is from Marcel Herbst.
<unk> capital and management. Please state your question.
Hello, Good afternoon, and thanks for taking my question.
One of the key products you.
I spoke on previous calls about was this at module, where you are reselling unsold.
AD inventory and take.
Cut off of the sales and I understand you had an opportunity to already test this out with one of them more customers. So maybe you can give us an update so what the results were and if you are still based on that and excited about this product is still tough on your list or <unk>.
The back seat that would be helpful. Thank you.
And that's a great question and the answer is it has not taken a backseat and we are very excited about it.
It's a complex module if you will there's a lot of parts to it that you know don't directly.
Have to do with the technology that we provide to our customers on this.
But we are working very closely with our customers. We're working extremely close with our partner who goes and reaches out if you will to the ecosystem of the advertising industry, which springs and the inventory of advertisements to our customers. We have a well if I may say and all hands on debt.
On this one.
So we're we're excited and continued debate Chris do you want to say anything I know you work you know.
Day to day with the customers that have the platform and stocks.
I just want a second that Bob of I believe that it's a it's a huge opportunity for us.
With our products I believe we have any unique opportunity here.
Because we support not only you know the optimization of AD revenues from our customers.
On the OTT streaming side, which is obviously crucial and extremely important.
And we also support that on the many of them more traditional broadcast side. So we have a very unique value proposition to help our customers generate additional net revenues.
And its not taken a backseat at all on the on the contrary, we're trying to expedite.
And the go to market on all fronts and for the customers that we have closed already we're trying to do everything we can true et cetera, the deployment of.
And we're taking ownership of the entirely because of its dimension and including those components are technologically or demand wise that we previously didn't have all the control.
And I would just add to that one thing that we had not done in the past with this platform and we have been doing fairly aggressively.
Educating the advertising industry I mean, the those of the Giants out there that had the gigantic media budgets and.
And it's important that they're made aware and we've been spending some time educating them, which typically you know of Mi at large media buying group at a giant worldwide advertising agency and rarely gets across the table from the of deep technology company like us. So we've been spending quite a bit of time educating the the glue.
And that if you will originates the AD dollars.
Well. Thank you that's great to hear.
Would you say that.
Most of your interest might come from existing customers that say, hey, you've got a great module. There we want to upgrade to this or would it more come from brand new customers that look at your services and and buy the module. In addition, or maybe exclusively this module.
Yeah, I think it's both we certainly have a long list of customers.
To get out too with the platform and and as the platform grows and and starts to become more successful.
You'll see our the long list of customers that we do have or will start to come back to us.
But we are speaking to new people about it are there is there continues to be a tremendous interest and and candidly, it's been and education game.
You know the the service operators the cable company they seem to understand it immediately but like I said, just a short while ago. It is important that all.
And all players in the advertising media ecosystem understands that as a platform like this is real it's up and running and it produces the results. So there's quite a bit of education that will still doing but ex that.
That brings us new opportunities.
Sounds, great and very exciting and best of luck.
Thank you thanks for taking my questions.
Our next question is from Steven Frankel of Colliers. Please state your question.
Yeah, Mike maybe you can give us some color as to.
And when.
We might see the bottom and that legacy maintenance.
Or at least when does it start to flatten out on the sequential basis.
Yeah, all of our legacy business and total was probably around <unk>.
I think 15 million.
This year, you know down from 30, but we do have probably.
At least half of that committed throughout the year. So you could see 15 and go to anywhere from.
Five to 10, you could have a situation where some of my exit of contract early.
So you'll see a decrease from the 15, but we will still we will still definitely have you know at least five to 10, probably from next year, but then you continue to see the wind down over the next couple of years.
And there was this hope that you were going to build up of another maintenance stream from.
The framework.
We're able to do last year is that a material amount of maintenance the help plug this hole or we should not really even look at framework anymore.
Well the.
The recurring revenue.
Quarterly piece from framework for all of the deals that we sold the last couple of years, there's about a million dollars just short and maybe right now nine and 75 or something and that is committed you know.
We're in year three.
Three of the framework you know some deals of three years somewhat for most of the five but you'll have that million dollar of quarterly run rate.
And for at least the next couple of years.
Yeah.
Okay. Thank you.
Yeah.
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Our next question is from Gregory attach the angle of International Service Agency. Please state your question.
Hello, and when I was young and.
Also in the International search agency, I haven't and base and Moscow, and not smoking and Hugh Bolton and talking to citizens here. The were wondering and see changes Nashua and supervised our from a go into the devotion to the.
What was.
Was the question I, just want to make sure our.
Debt I heard it properly with the question of are we.
Bringing our services.
To your country.
What the question was that I wasn't quite sure.
Yeah.
Yeah and the future.
Oh yeah.
Well, Chris you're you're certainly a close and geographically than I am So and you probably know that part of the world of at least from a marketing of technology better than I do so do you want to comment.
Sure. We do have a you know and you may know, we have a and R&D center and in the central and Eastern Europe and Poland.
Also of the very strong sales person around debt regions central and eastern Europe were slowly expanding towards towards the you know too.
Two of the we haven't yet arrived and kind of in Russia, and but we are certainly considering.
To attack the market as well, but as you know probably much better than I do.
Really nothing out of the business opportunities and a country like Russia is the needs to be prepared well.
And debt is certainly administrative the potentials on the on the road and therefore, it is upcoming Susquehanna right and I may add if you I don't we.
And we just met but if you.
And we're interested and introducing us to those opportunities or relationships and your country. We would welcome them and I promise you we will be responsive if you give us a phone call and email anything and we're easy to get a hold of.
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One moment, please while we poll for any additional question.
And there are no more questions. At this time. This concludes our question and answer session and for your question was not taken please contact sea changes IR team at S. E. T. A C at Gateway IR Dot Com I would now like to turn the call back over to Robert Pons range.
Closing remarks.
Thank you. Thank you our shareholders. Thank you prospective shareholders.
Rarely have I seen the company.
More and the and.
And a 90 day period as quickly.
As Ive seen air company.
And things feel remarkably different morale is high and our balance sheet is secured.
And we just happen to be a provider of technology and the fastest growing segment of the broadcasting industry video streaming.
Not a bad place to be if you're a shareholder of prospective shareholder of our company.
We have the assets.
I always speak about our great assets, our assets from our talented people.
Both on the business development side on the finance side and a big Shout out to you know close to 150 highly qualified video software streaming technology folks and Poland are great assets for our company to have we are of great balance sheet.
We have the right technology assets and I just mentioned, we have the right people.
To me I I've been around a lot of technology companies over close to 35 40 years Boy does this feel like and.
And all levels, the right formula to grow out of value to all stakeholders shareholders employees and customers alike, and I want to leave you with one word you've heard it throughout this presentation for a reason and it's part of what we're so excited about and that word of streaming streaming and streaming and thank you everyone and Stacy.
Thanks.
And so everybody.
Thank you for joining us today from sea changes fiscal fourth quarter and full year 2021 Conference call. You may disconnect. Your line. Thank you.