Reply To: NOT A DEAL: Spitfire Has Been Acquired by Splice

[peter]

On GoncaloL said

The amount of backlash on that video is really telling of the way their customer base feel about it. There is no positive spin to it

Spitfire will surely feel an abrupt decrease in their revenue

Social media comments don’t always correlate to buying actions and my instincts are that these knee-jerk reactionary comments don’t reflect market behavior, just worries that people have. The AI talk in the video clearly concerned a lot of commenters. If Spiftire took actions that made its base feel it was committed to continuing forward with its high end Spitfire sample  libraries and perpetual licenses and did say, major across the board major price cuts, I don’t think there’s any doubt that they’d see some very good revenue increases. I  think, as a software company that was just acquired, you absolutely would expect that there would be a hesitation from many existing customers before making additional purchases, but the ball is in Splice’s corner on that.  I think it’s all dependent on how quickly Splice can make moves that inspire the market to have confidence that they’re committed to continuing with what many Spitfire customers  care about.

Now if Splice were to ignore the reaction in their strategy, that would be a mistake. And no, I don’t mean they need to address a bunch of reactionary YouTube comments. I think they need to take strategic and communications actions with Spitfire that conveys commitment to existing, traditional Spitfire customers. There are numerous ways they can do that. They can share product roadmaps, the CEO can merely talk about the vision for Spitfire. But the CEO should communicate, more specifically what her plans are for Spitfire beyond this high level talk. Paul gave reassurances that Spitfire was committed to perpetual licenses in the video, but I think the CEO needs to do communication from her that is clear in order to quiet the concerns of existing Spitfire perpetual license customers.

Now, if I were in the CEO’s shoes, I would have used this video tomake very clear that Splice was committed to Spitfire’s current customer base and then spoke about the future. I think there was a lot of the CEO’s ego in that video. She was concerned about painting herself as a visionary and painting Splice as a visionary that cares about artists. But when you make an acquisition of an established company with a solid customer base, the first priority should be assuring that customer base that you are committed to them. She did poorly in that area. But it doesn’t mean that Splice doesn’t have that commitment. Paul was carrying those messages and instead the Splice CEO just like waxing philosophical and talking about her own background. Not a great first impression. She should have had Paul introduce her and then focused on Spitfire’s future FIRST then Splice’s vision. But the YouTube comments, IMO, aren’t measured reactions and my experience leads me to believe that they will not reflect market behavior — just already known negative perceptions about AI among many hobbyist musicians and negative perceptions of the Splice brand, largely by people who don’t use those kinds of samples (based on a quick read of the comments). Put out a believable statement that shares that Splice is committed to continuing with Spitfire orhcestral library lines and do across the board deep discounts and I’m very confident that you would NOT see sales decline.

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