Video as a Service: Rimage Acquires Qumu

Rimage Corp. has acquired Qumu, which specializes in enterprise video communication, for $52 million in cash and stock. The deal arrives as many managed services providers (MSPs) seek to master telepresence and managed video services.

Rimage provides on-demand CD/DVD/Blu-Ray publishing systems. Acquiring Qumu could allow Rimage to expand its customer base. Within the Global 1000, Qumu has more than 100 customers across the banking, technology and telecom verticals and has established distribution partnerships with Sony and AT&T. On the flip side, Qumu intends to leverage Rimage’s global reach.

Qumu’s revenues have grown 45 percent over the past three years. That growth is expected to continue in 2011 and 2012. Qumu reported $10.3 million in revenue in 2010 and estimates that it will bring in roughly $15 million in 2011 and $21 million in 2012.

Going forward, Rimage will be able to leverage Qumu’s video capabilities across desktops, smartphones and tablets. Qumu customers will have access to Rimage’s virtual publishing technology. Qumu will continue its operations at its headquarters in San Bruno, Calif., and Qumu President and CEO Ray Hood will become senior vice president of Rimage Corp.

No doubt, demand for video services is on the rise. Enterprises will spend roughly  $5 billion on videoconferencing and telepresence by 2015, predicts Infonetics. As a result, some vendors are increasing their managed video investments. One other example: Glowpoint’s acquisition of Avaya‘s telepresence efforts.