After two years searching for a new leader, pioneering online video platform RealNetworks announced that Rob Glaser, who founded the company in 1994, left in 2010 and returned as interim CEO in 2012, will continue onward as permanent CEO. The company announced the appointment a few hours ahead of releasing its second quarter earnings results.
Glaser (Source: RealNetworks)
Once the go-to player for Internet video, RealNetworks struggled in recent years as competing technologies moved in and audience tastes and demands shifted. After Glaser's departure, the company worked to streamline its offerings, spinning off its Rhapsody music streaming service and selling a chunk of its patent portfolio to Intel for $120 million. It also refocused itself as a digital media company offering a platform for other companies, such as its ringtones service for wireless carriers.
Still, RealNetworks saw two CEOs resign between 2010 and 2012, and its business continued to erode. Once worth as much as $10 billion at the turn of the century, the company is currently valued at $282 million. After CEO Thomas Nielsen stepped down (he remained as chairman), Glaser returned as interim CEO and continued the work to turn things around.
Last fall, the company announced its new online video offering, RealPlayerCloud. The service has grown from 2 million registered users in the first quarter to more than 5 million. It also is "revitalizing" Rhapsody, in which it retains a 45 percent stake.
And Glaser's goal of making the company's OTT services available across platforms and devices is on its way, with the company launching its RealHome Media Portal at TV Connect in March. The solution targets pay-TV providers and "optimizes the delivery of OTT and digital television content" across connected devices including set-top boxes, smart TVs and mobile devices.
Glaser told Re/Code that he decided to take the job permanently because RealNetworks' changes are a long way from complete. "We are at the midway part of the turnaround and have fixed the product part, so the next steps are critical," he said.
"In the 2 years I've been interim CEO, we've made tremendous progress revitalizing Real's leadership team and products," Glaser said in a company press release. "In this next phase, we will both continue to deliver compelling products that consumers embrace, and also leverage the popularity of our products to re-establish the company's financial success."
In the second quarter, revenues continued a slow downward march for RealNetworks, coming in at $40.8 million, $4.9 million less than in the first quarter, but within its forecast range of $38 million to $41 million. The company saw a GAAP net loss of $21 million, or a loss of 51 cents per share.
Its unrestricted cash flow remained steady at $195 million for the first half of the year, compared to $226.2 million at the end of 2013.
RealNetworks forecast revenue for the third quarter to land somewhere between $33 million and $36 million, with an earnings loss (at adjusted EBITDA) of $18 million to $20 million.
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