SBJ/February 27 - March 5, 2006/This Weeks News

XOS quickly becomes teams’ video star

Several football coaches gathered around former Northern Illinois quarterback Ken Williams as he stood at a demo booth during the American Football Coaches Association Convention in Dallas last month. Clad in virtual-reality goggles and reflective sensors, Williams practiced passing plays against what, to his eyes, appeared to be a live defense.

“We’ve grown so fast and for so long,
it’s hard to imagine a ‘stable’ period.”

Dan Aton
XOS Technologies founder
Williams was wearing a SportMotion suit, exhibiting part of the newest innovation from XOS Technologies, a seven-year-old company that does business with more than 700 college and pro teams. The company provides video editing systems that convert game footage into packages for coaching and player use, holding deals with 30 of the NFL’s 32 teams and 28 of the NBA’s 30 clubs. XOS also handles Web site business, providing the back-end operations for the sites of seven college conferences, 51 athletic departments and the Arena Football League.

This week, the company is expected to announce a deal to provide live and on-demand streaming video and audio coverage of next month’s NAIA basketball tournaments.

Dan Aton, founder and CEO of the company, declined to detail the company’s financials, but he said XOS has more than doubled its annual revenue three times in its history, including a 119 percent jump from 2004 to 2005, when it posted sales in the high eight figures.

Clients pay a flat fee to purchase XOS’s video editing equipment, with the fee varying based on the amount of hardware and software purchased.

XOS also has increased its staff, employing 130 people in 2005, up from 74 at the end of 2004 and 48 in 2003. The company has retained key personnel from companies it has acquired as well as hiring new executives, including recent hires Craig Rosenshein (former CBS SportsLine marketing director, now XOS Network marketing vice president) and Nada Usina (XOS Network president, previously president of Nokia Canada).

Texas A&M meeting room
Inset: Air Force coach's lecturn and station.
The Sanford, Fla.-based company got its start when Aton was working on a project in Orlando as a sales engineer for South Western Communications. Aton noticed in the course of that work that the immense RDV Sportsplex, practice home for the Orlando Magic, was a technological mess, so he and others re-did the complex as an additional project. Gone were the stacks of VHS tapes, clunky wiring systems and organization-by-post-it-note. Installed was a streamlined, organized system.

The Magic referred Aton to other teams and, when they contacted him, he launched XOS from his home, later opening the company’s office in Sanford, 25 miles north of Orlando. He soon hired Randy Eccker, who had extensive video editing contacts, and expanded XOS from a facility integration company to one that also produced the equipment it installed.

“Several companies were focusing on video analysis and editing projects,” said Aton, 46. “The part we did that was unique was facility infrastructure. … That gave us a foothold and foundation to build upon.”

XOS improved its video editing products by applying revenue raised from facility integration work to develop new technologies for the equipment. As growth continued and venture capitalists invested, XOS expanded into the areas of scouting and coaching tools and Web site work by acquiring several smaller companies.

SportMotion package
In early 2005, XOS completed its purchase of competitor Pinnacle Team Sports, a subsidiary of Pinnacle Systems that wanted out of the sports video editing business. That deal gave XOS its first seven Major League Baseball clients and a larger share of the NFL video market.

XOS has added more new clients in large part because of word-of-mouth. XOS clients tout both the company’s products and its customer-service efforts.

“You’re only as good as your equipment,” said Drew Perry, the Charlotte Bobcats’ video coordinator. “A lot of the really good video guys in this league are the ones who can troubleshoot. You need that support on the back end.”

“[XOS staffers] have been very responsive to whatever changes that I wanted to make,” said Dave Kellogg, who manages Air Force’s XOS-produced athletics site, “and [they] have been fairly quick in facilitating those changes.”

XOS is not without its challengers, though. The Seattle SuperSonics, who along with Dallas are the lone NBA clubs without XOS systems, employ Sports Tech, an Australian company.

“It’s easier to find information and the filtering system is much better,” said Walt Rock, director of video scouting for the Sonics. Rock added that the Sports Tech equipment cost $50,000 less than the price of a comparable XOS system.

Another company, Synergy Sports Technology, employs 35 people who thoroughly log each NBA game, then upload their work to a massive database. Ten NBA teams, including some who also use XOS equipment, pay to search through that online database for clips.

XOS makes great equipment, said Synergy CEO Garrick Barr, but it “lets you do all the work.” Synergy does that work for clients, but, unlike XOS, does not allow them to internally circulate video.

On the Web front, College Sports Television manages the athletic sites for twice as many conferences and more than three times as many schools as XOS, offering many of the same online features. Host Communications is also a competitor, producing ncaafootball.com as well as Web sites for individual schools and the SEC.

CSTV President Brian Bedol said the market can support three or four competitors.

Usina is confident in XOS’s growth potential, citing several new developments, including an online ticketing service, photo stores, and this week’s expected new NAIA offering via XOS’s collegesportsdirect.com.

Last week, XOS officials were to be in Indianapolis to exhibit the SportMotion package at the NFL’s scouting combine. According to Aton, the seven-figure investment in SportMotion is just one part of the diversified company’s plans for the future.

“We’ve grown so fast and for so long, it’s hard to imagine a ‘stable’ period,” Aton said. “I think we’ve still got a lot of ground to cover.”

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