Lisa Schneider & Travis McMahand, Videotel

Sixteen:Nine - All Digital Signage, Some Snark

The 16:9 PODCAST IS SPONSORED BY SCREENFEED – DIGITAL SIGNAGE CONTENT

There are not a lot of companies that have been involved in what we now call digital signage for 44 years, but Videotel has been selling technology that puts marketing information on screens since 1980.

The company started with VCRs (younger readers may have to Google that) and then started designing, manufacturing and selling DVD players that, unlike consumer devices, would happily play out a set of repeating video files for weeks, months and years. Back in the days before fast internet connections, cloud computing and small form factor PCs, that's how a lot of what we now know as digital signage was done.

About 14 years ago, the San Diego-area company added dedicated, solid state digital signage media players - and that product line has steadily grown to include networked and interactive versions. The company also now has interactive accessories for stuff like lift and learn, and directional speakers that help drive experiences in everything from retail to museums.

I had a good conversation with Lisa Schneider, who runs sales and marketing, and Travis McMahand, Videotel's CTO. We get into the company's roots, the evolution to solid state media players, and how Videotel successfully competes with $400 and higher players, when at least part of the buyer market seems driven mostly by finding devices that are less than $100.

Subscribe from wherever you pick up new podcasts.

TRANSCRIPT

Thank you for joining me. Can you introduce yourselves and tell me what Videotel is all about?

Lisa Schneider: Yes, absolutely. Hello, Dave. Thank you for having both Travis and me today. We appreciate it. My name is Lisa Schneider and I am the executive vice president for sales and marketing for our company, Videotel Digital.

We were founded in 1980. Gosh, it's been almost 44 years now, back when we were manufacturing top-loading VCRs, that went into industrial-grade DVD players, and now in the last 14 years, we are manufacturing digital signage media players. We have interactive solutions that include various sensors like motion sensors, proximity sensors, and weight sensors. We've got mechanical LED push buttons and touchless IR buttons and RFID tags, and things like that that create interactive displays. We also provide directional audio speakers. We have various form factors for all types of projects, and then we also have Travis on the line with us. I'll let Travis introduce himself.

Travis McMahand: Oh, hi, I'm Travis McMahand I am the CTO of Videotel Digital.

Where's the company based? Is it in San Diego?

Lisa Schneider: Yes, we are in, it's San Diego. It's actually Chula Vista, borderline San Diego. So in California.

San Diego area.

Lisa Schneider: Yes, San Diego area. Beautiful San Diego.

So I've been aware of your company forever and going all the way back to the days when you were doing industrial grade, commercially oriented DVD players. In the early days of digital science before things were networked, that's what people were using and if you used a regular DVD player or even a VCR or something like that, the thing was really not set up to play over and over again if you were using just like a consumer-grade device.

So the whole idea was you were, you guys developed commercial-grade versions that were rated to last, for days, weeks, months, years. Is that accurate?

Lisa Schneider: Yes, that is accurate, and it was, that was our flagship product back in the day. That was because we made a truly industrial-grade player and it would auto power on, auto seamlessly loop and repeat without any manual interaction, even without a remote. So it was a looping player.

We actually still have three different types of industrial-grade DVD players that we still offer. They're actually really popular in healthcare facilities because they are specifically UL-approved for medical DVD players still, and they are still out there and, we are still producing them.

The attraction for that at the time was that just the absence of really networked media players unless you were quite sophisticated and were using big box PCs and everything else, I assume that market with the exception of what you’re saying about Hospitals is largely gone away?

Lisa Schneider: It hasn't been, for example, like sometimes with waiting rooms, people are still using DVDs for movies, for entertainment purposes, not just in healthcare. Sometimes there are still people who are self-burned content for museums. It's just simple for them to just throw the disc in and then they walk away and it just continuously loops. So they're still out there.

It's not completely gone away and we are one of the only ones left though that is still really providing the industrial grade DVD players.

You said about 14 years ago, you got into digital signage media players that were not based on DVDs, it was based on hard drives or solid-state storage.

Lisa Schneider: Yes, we started with solid state media players that were just simply looping off of an SD card or USB, no network connection, none of the fancy stuff, and that was really kind of the migration from the DVD, because people didn't want to use DVDs anymore. They just wanted to upload their content, do the same thing, load them, and go.

So we probably still have a few versions of just solid-state players. That's how we entered the market. But one of the really cool things we did was we made one of them interactive, which, that's where we come into the interactive solutions, which we can talk about too.

The primary products that you have now are network-connected, right?

Lisa Schneider: We have both. We still have solid-state digital signage players, for those simple needs, and then we do have networked players as well.

I'm thinking there's an awful lot of cases like retail marketing for brands for product launches and things like that, where, yes, you could use a network digital signage player, but it's loading up a set of files at the start and that's really all it's ever going to use, right?

Lisa Schneider: Yes, that's a lot of the use cases, where they just want to upload the content and let it go but there are obviously use cases where the content is ever-changing and they can push out content on our remote players, network players, via quick push.

Do you have device management? Will you know what's going on with these devices, as they're out in a big box or whatever?

Lisa Schneider: Yes, one of our new player, we actually just did a press release on it for our VP92 4K network player. It will allow customers to use our free embedded software on the player that will allow them to push out the content remotely and that they can see what is being played in the various locations, wherever the box is deployed to, and then if it's just a single unit or hundreds of units if it's up in the thousands, then we recommend our cloud-based CMS software where they can manage, do all the management within the software itself.

So you have your own software, but I'm assuming you're not selling yourself as a software company?

Lisa Schneider: No, we are not selling ourselves as a software company. We have hardware and then we have various software options. But it is embedded in the players to make it extremely simple to use.

And it's tuned specifically for your devices.

Lisa Schneider: Correct. Yes.

Can a third-party CMS company, a CMS software company use your boxes?

Lisa Schneider: Travis that might be a good question for you to answer.

Travis McMahand: That's a possibility. We design our players to be simple and reliable. We don't make it so difficult to set up a program, so in doing that, we've hidden or disabled, certain features within the operating system. But we can still work with companies if they have a specific application or service that they want to use. We can definitely work with companies to try to make that happen.

Okay, so I guess a scenario would be something like a retailer or even a brand that has networks in stores and is using a CMS for the big displays for retail marketing and they say, we would like to use your stuff for the interactive or whatever, can we use the same platform to manage both of them?

Travis McMahand: Yeah, that's a possibility. It goes on a case-by-case basis.

It's not something you're actively marketing, but technically you could do it if it makes sense for both sides, right?

Lisa Schneider: Absolutely, Dave. That's what I'd like to interject. We're open to those conversations with anybody who is interested, especially if it is a larger project is something I would entertain.

The hardware sector has been a tough one for a lot of the companies that have media players, with maybe the notable exception of BrightSign, which has a very big footprint everywhere, but the PC guys in particular, struggled to, in recent years, get relevance, and a lot of that seems to be driven by a race to the bottom to see how low we can go in terms of cost for a media player, and we now have Amazon with a custom build or kind of a stripped-out build of its Fire Sticks that are $99.

Has it been a challenge to compete with that stuff or, do you operate differently or have a different market?

Lisa Schneider: That's a great question, and yes, I did see that new Amazon $99 Fire Stick. But we're very unique in a sense where, sure you can purchase a $99 player, but is it really industrial grade? Is it going to seamlessly auto-loop? Is it reliable? Can you connect interactive devices to it? Can you grow within it?

So it is a challenge in some aspects of it. But it seems that the ones that go, the customers that choose that route, end up circling back and they want more. It wasn't enough. The price was good, but then they realized, if we invest a little bit more, we're getting all of these things that we can grow into.

And your media playout boxes, they look like they're industrial grade, ruggedized. They've got what looks like heat sinks or things like that built into it. Are these designs done in Chula Vista and then you have contracts manufacturer over in Asia?

Lisa Schneider: Yes, spot on.

We design our own players in-house, and then we have them made, and we have a stringent process and a bunch of design engineers that are just constantly trying to break things, and they do a really good job of it, and we are very careful as to what we put out in the market and that is what also makes us unique.

And that allows you to sell at a higher price point because you have people looking at it and going, okay, I get why I'm paying more for this.

Lisa Schneider: Yeah, absolutely. We're not just relabeling some cheapo boxes. This is something that is designed in-house and these are the features, and we are able to get a little bit more because we are using premium parts during the manufacturing process and other other reasons as well, not just for the hardware.

Travis, is it your own operating system or are you running on some kind of flavor of Linux?

Travis McMahand: The base operating system is Android. We use Android and just build off of that, build our apps within it, and set up all of the settings exactly the way we want.

Has that been that from the start or did you evolve into Android?

Travis McMahand: Oh, we evolved into Android. We originally started when we first were doing players that were playing content just from USB and SD cards. It was really simple at that point and we were doing our own operating system. embedded operating system within the player at that point.

But then when we wanted to start adding more features and opening up the platform to more types of files, we found that using an Android-based operating system was much easier and more reliable to get going.

When I look at your customer list, it's impressive. You've got a whole bunch of interesting customers, a lot of them appear to be attractions, museums, that sort of thing, some brands, and so on.

How would you describe, Lisa, your core customer base?

Lisa Schneider: I would say our core customer base is going to be in the retail space, museums, trade shows and events, and probably hotels, if I had to go down the list, but, we have just about everybody from food and beverage to restaurants, people use our players for menu boards, a lot of kiosks. We do healthcare, dentist offices, med spas, we're into transit on buses and bus stations. Just like the list goes on, but I would say those would probably be our top.

Because you have these ruggedized boxes, is it advantageous that you are in the San Diego area as opposed to on the other side of the Pacific in terms of, there are companies that also sell small form factor, ruggedized media, and play-out boxes that are in Taiwan or China. But the challenge you sometimes have is the time zones and language.

Lisa Schneider: Yeah, we make it known that we are in the States, obviously we wanted to serve the US, but also we can maintain and manage the international business as well. But yeah, it's just was like just evolved in that way.

You sell direct or do you have channels and distribution?

Lisa Schneider: Great question. We do both. We sell directly more to the small business owners, and then most of our business is through integrators and the reseller channel.

Why did they come your way? We covered it, but I'm still curious about the pitch when you get asked, why you?

Lisa Schneider: Yeah, why Videotel? We've been around for 44 years, and we have experience. One of the big things is we really do listen to our customers. The word gets out, we offer free customer support and free technical support. You get a live person on the phone. Our customers are constantly, it's funny how they say, gosh, thank you for calling me back. It’s “does so and so not call you back?” So they love us for those reasons and that we do offer industrial-grade equipment. It lasts and thank goodness the rumor is out there that we make solid products.

I'm also curious about how you get the manufacturing done. Do you have somebody located in China or wherever it is?

Lisa Schneider: Yes, we do.

We have a team of people that are in China that we've actually had relationships for, gosh, I think 15 years now and so it's a very solid relationship. It makes it so much easier to communicate, and then they're the interface to all of the manufacturing that goes on. So there's our front lines there and it makes it a lot easier for us.

Are your deployments, I guess they're not your deployments, but the projects that are done, do they tend to be small quantities and a lot of different customers or do you have accounts where they may have hundreds or even thousands of your units because they're all over the place?

Lisa Schneider: Yeah I would say probably 70% of our business is the small to mid-sized business and then the other 30% is where you're going to find the more enterprise larger on the upward of a thousand projects.

As a biz dev person when you have a whole cavalcade of smaller customers that gets to be a challenge to manage, right?

Lisa Schneider: It can be, but this is what makes life a lot easier for us as a team here is that our products are so easy to use that they are plug-and-play. They can figure it out. We have a whole learning program, a bunch of videos on our website, examples, and things. We have a chat, so it flows nicely. It really does.

It hasn't been too much of a burden because I think we just make things that are simple. That's what we pride ourselves on.

So I go directly to you, I'm a museum, and I need three of these things for looping videos. I order them, and you ship them to me, what do I need to do to get them running?

Lisa Schneider: You need to simply connect it to your HDMI to any of the screens that you're using, and then you upload the content on the USB SD and then you insert it and it will play or if you're using the network capabilities, same thing, you plug it in, you get your network connection and then depending on if you're using the free embedded software, It's a matter of just opening up the software on the player and choosing the source that you want to use. If it's, let's say USB SD, if you want to use SFTP or LAN, you can point your content to a URL, but it's basic clicking of a button and uploading your file, it's just that simple.

So if you want to get fancy, you can, and use file transfers and everything else, but, if IT is not your role, but you just need to get something running, you don't need to bring somebody in to help you.

Lisa Schneider: That is exactly right. In fact, I always tell people, I say, you do not need a computer science or an IT degree to run our stuff. So you get it, take it out of the box, plug and play, and you're really ready to go.

If it's networked, wre you getting questions about security these days?

Lisa Schneider: Yes, I think we have. Not too many, but Travis would be better suited to answer that. He handles that side of that.

Travis McMahand: Yeah, for security, we really try to lock down the player to make it so that it really doesn't have any incoming ports to it. So you can't log directly into the player over a network. The only settings that you can do on the player itself are done with either the infrared remote control that comes with the player, or you can connect a keyboard and mouse to our network players to access the menu that way.

But for the sources, say you're using a shared LAN folder or an SFTP site, you're putting your content on one of those sources, and then you're just pointing the player to that source and telling it, okay, go check for new content or check for changed content every hour or every day or whatever. So the player itself goes out and checks for the content. There's no inbound traffic to the player that the player doesn't initiate,

Gotcha, and I gather from the IT and IS crowd lately that whereas several years ago they were pretty jumpy about using Android, they're now pretty comfy with it.

Travis McMahand: Yeah, I haven't heard too many complaints about it being an Android player. Once we explained the security that we have built into the player, we really haven't had any pushback on that.

Let's talk about interactive. Why did you go down that path? Was it customer demand?

Lisa Schneider: Yes. You know what? It actually was. It started with a museum actually in San Diego and they came to us and they said, this is what we're looking for. We want to trigger content and this is how we want to do it, and we thought, okay, we'll give it a shot, and then it just bloomed from there.

Once we came up with a way of connecting and how we're gonna create the interaction, then we started evolving from there with all the different types of interactive sources.

You also have interactive devices that are paired with your playout boxes. Was that a kind of a learned decision that you're best to develop your own as opposed to trying to integrate other stuff that may be used for other purposes and could maybe be hacked to work with this?

Lisa Schneider: Yeah, I think that the reason we just did it in the house was because we wanted to control it, and also really because everything was just out was so complex. We're like, okay, we need to just bring this down 10 notches. Let's just, we need to make the super simple for our customers. So then that's why we just developed it in-house.

Yeah, in my dark past, I worked with a company that did digital signage solutions and had its own media players, and I remember there was an ask for interactive, and we had to source big ass buttons from a company that made buttons for slot machines, and then we had a guy who worked out of a, I think a motorhome somewhere in California and designed controller boards. So we had a custom controller board for this thing and everything else and it worked, but good God, that was a process as opposed to just saying, “Yeah, I want this play-out box and, I need two of these, and two of those interactive things.”

Lisa Schneider: Oh, that's pretty much how it went down with us too. And our team really loves the challenge. We love doing custom work. I know Travis is working on a bunch of stuff right now with different projects. We have one that is using our interactive IP push, is what we call it, for the automotive parts department actually, and I can't say who just yet, but, it's a customer that just reported back that with our solution that we created, this was the first time in the history of their company they had the highest productivity.

Again, it comes from the customers. That's what I mean. When I say we listen to our customers, they help you grow,

When I look at the different accessories that you have, there's motion sensors, there's triggers and buttons and things like that. What typically are your customers using?

Lisa Schneider: I would say the most popular would be the LED push buttons and/or the IR touchless buttons for museums, also in the trade show booths, I would say our sense solution, is our motion sensor that kind of detects human distance from a display. So you can lure somebody into something and then it would trigger the content once they're in within a certain range. I would say that was probably our two most popular solutions.

We also have a sensor that's a wave to-play where you just wave your hand over an area and it will trigger content. That's another popular one too.

I've always wondered about some of those things because if there's any sort of a learning curve, like you, you've got to get somebody to wave to change a file or whatever that is, how hard is it for them to figure that out? Even though it sounds simple.

Lisa Schneider: Yeah, we do. We make suggestions for, God, the stuff that some of these integrators come up with is so cool, but they do make it really simple, using decal stickers or there it's on plywood or it says, wave your hand here, or it's within the content itself. So they come up to the screen. It's pretty pretty self-explanatory.

We're not one of those where it's going to tell you your age, your hair color and eye color and anything to that degree. This is more simple. We don't find too many people standing there lost looking at it, thank goodness.

Are many using the capabilities to lift and learn?

Lisa Schneider: Yes, that's one of our newer solutions that we just came out with, really cool, lifting a product off of a display and then it triggering. Retailers are really taking to that right now as well as the museums, where you have to physically hold something, lift it.

Yeah. It's interesting because that's something that's an idea, a concept, and a capability that has been around for 10-15 years. So when I've seen companies saying, look, we can do lift and learn. I'm thinking, okay, you didn't exactly discover fire. It's been around, but it really didn't have much marketplace adoption until now, it seems, recently.

Lisa Schneider: It is, but the lift and learns that was out there before were again, so complex and we take it down a notch and it's just a matter of making a harness, they plug it in the back of the player, plug it in the TV and you name your files a certain way and they're good to go.

So yeah, we're not reinventing anything, but. We have made it so simple to use that you don't need that, to a degree to figure it out.

When you talk to prospects and they ask about your company and everything, is there a reference customer, or a project that you tend to trot out and say, here's a great example of what we do?

Lisa Schneider: Yes, there are so many. We're lucky enough to have a whole plethora on our website of case studies that have participated in that. So if I say yes, if it's a museum, I say, okay, I have a link to a laundry list of museums, and here's what we did for them. They shared their photos and how they did it. So yes, we absolutely can do that.

All right, this has been great. It's terrific to finally have a chat with you guys and find out more about your company. Thanks for spending some time with me

Lisa Schneider: Yes, absolutely. Thank you for the opportunity. It's always so good to chat with you.

Travis McMahand: Yeah. Thank you