Dedicated Micros Collapses, CEO Says Shut Up, Debates IPVMBy: John Honovich, Published on Apr 18, 2016
No one exemplifies arrogance and bad strategy quite like Dedicated Micros CEO Mike Newton.
When he was not busy running around the racetrack, he was running his company into the ground.
In this note, we examine the collapse and what this means for the industry. Plus, we include detailed response and counterclaims from their CEO.
Long Steep Fall
As we examined in The Fall of Dedicated Micros, DM's decline started a decade ago and never recovered.
From their ~$135 million peak, the company's revenue declined to ~$45 million in 2013.
He bet against IP while betting on race car driving.
Here is DM's CEO 'theories' about IP:
And here is DM's CEO racing:
Defiant To the End
Dedicated Micros, as it was, is being shut down / restructured, with UK employees being laid off and a new 'company' being formed.
Here is how DM's CEO explained it on Facebook:
For those that may be aware of the big changes at AD Holdings, and have sent their support by various means, may I express my thanks on behalf of everyone. The team moving forward appreciates this support, as we build a new future together as NetVu, along with our good colleagues in Dedicated Micros Malta, Dedicated Micros USA, and AD Aerospace. We share our sympathies for those that are unable or unwilling to come on the next stage of the journey with us.
For those that have nothing nice to say, the best advice is to just shut .. up.
It would be easy but unfair to blame the Chinese here. DM was destroying itself, long before the Chinese entered. When you bet big bad (think IQinVision / H.264), this is what happens.
That noted, price decline certainly did not help and we think that there will be many more companies folding in the next few years, as even companies with decent plans are undermined.
UPDATE: DM CEO Responds
Mike Newton, DM CEO, has posted multiple long responses in the comments below. We encourage you to scan through them and read it in full. We have copied the official announcement he shared in the comments, explaining the administration / insolvency and the subsequent restructuring:
NetVu Ltd Statement
On 18 March 2016, a newly formed company Aghoco 1389 Ltd ( to be renamed NV Ltd)
acquired all of AD Holdings indebtedness of some £4.7m to Barclays Bank and Mike Newton.
NV is jointly owned by private investors, Mike Newton and Maghsoud Einollahi.
Today, 15th April , NV acquired all of the business and assets of AD excluding UK operation of Dedicated Micros in the UK which has entered Administration.
NetVu Ltd is a wholly owned subsidiary of NVL. NetVu Ltd will operate out of its two premises in Cheshire, England, being the technology centre at the previous location in Appleton Thorn with an established team of developers, and the newly completed premises near Northwich, Cheshire providing for Sales and Support.
NetVu Ltd will be undertaking all future warranty and support activities for all UK and European customers of Dedicated Microcomputers Ltd in the UK.
Mike Newton commented
“The video security market has been very challenging in particular in the ‘desktop recording’ sector, and while DM enjoyed exponential growth in the mid 2000’s, the aggressive commoditization of that sector by low cost foreign imports has resulted in significant declines in those areas. We have however continued to develop innovative and powerful technology, with our NetVu Connected Virtual NVR solutions, FireVu visual smoke and flame detection, and TransVu, one of the worlds leading mobile recording and vehicle data processing solutions.
Key back office support software leverages the maximum return for our users, and allows for critical value added solutions, regardless of whether it is a ‘desktop’ solution or a fully virtualised solution.
With NetVu we believe we have created a fresh and vibrant structure which can take these products forward, while also serving the remaining ‘desktop’ recorder market, which while significantly reduced from its peak, still remains a significant element in the new operation.
We see this now as an opportunity to focus not just on the traditional recording sector, and combine it with the innovative and evolving technologies”
April 15th 2016, Cheshire, England