Native Instruments, the Berlin based music software company behind plugins like Kontakt, Battery and it’s flagship controller/workstation Maschine, has entered preliminary insolvency proceedings in Germany.
That sentence alone sounds scary, so let’s slow it down and talk about what it means.
What Preliminary Insolvency Really Means
Preliminary insolvency does not mean Native Instruments is shutting down today. It means the company is having some financial issues and has asked the court for help.
Basically, they need a bail out. This generally involves; finding new investors, selling parts of the company/assets and or restructuring…Sometimes, selling the company off as a whole.
This process gives a company time to breathe. The goal is to figure out if the business can survive in a new form. Employees often keep working. Products usually stay online. Updates might slow down, but nothing is stopping overnight.
That said, it also means the company could not meet its financial obligations without help. That’s the red flag.
Why This Hits Producers So Hard
Native Instruments plays a huge part in many music creators setups. Kontakt libraries power film scores, and games. Maschine is the main creative hub for a lot of beat makers. Traktor is still used by working DJs around the world.
When a company like that struggles, the fear isn’t about today. It’s about next month…Next year. People start asking questions like:
- Will my libraries still work?
- Will updates stop?
- What happens if ownership changes?
That uncertainty is what makes this news heavy.
How The Soundwide Era Fits In
Over the past few years, Native Instruments was grouped together with iZotope, Plugin Alliance, and Brainworx under a larger brand called Soundwide.
Many users felt the gut punch at this very moment. Product direction felt unclear. Long time customers started saying the company felt more focused on pricing and bundles than on fixing and improving core tools.
Those complaints didn’t cause insolvency on their own, but they point to a deeper issue… losing trust over time.
So What happens To Your Plugins and Sound Libraries Now?
Right now, everything is working as normal… Your software still works. The licenses are still valid. But long term support depends on what happens next. Again, that’s pretty scary for most.
If parts of the company are sold, another company could take over development. That can be good, bad, or somewhere in between. The value of Native Instruments’ products is still very high, which means buyers will be interested.
Take a Deep Breath…This Isn’t The End YET
Some companies come out of insolvency much more focused..better? At this stage, it’s really too early to know what happens next. For producers, this is a reminder to pay attention to who owns the tools you depend on. Software isn’t just creative gear anymore. It’s business infrastructure. And when that infrastructure shakes, people notice.
What are your thoughts? Let us know in the comments!
16 Responses
I have every confidence that this is not going to be the end for Native Industry, their products both software and harware are entrenched within the music industry, meaning there is an ongoing demand and thus financial value, no doubt there will be a capital injection, restructure and things will continue hopefully in a more focused way,
Someone will probably pick up Kontakt, in the worst case scenario.
And the same company or another at least several of NIs instruments.
If splice has the money I would not be surprised if they bought NI in that case.
NI was one of the few companies that could have made subscription a valid option as they could have easily licensed Kontakt libraries from 3rd parties any year they are were not able to produced enough of their own content, to make user feel like there was an advantage to having a subscription.
NKS might not survive, and that would be a mixed bag. There were many issues, and NIs idea of what controls a hardware should have was limiting. And the so called 3rd party support was just a marketing stunt, it was presets for setting up 3rd party midi controllers, that you had been able to do for several of years.
But tagging, and sound examples for browsing sounds, from a single location, and in particular with the new hardware getting support for NKS directly in the DAW, without going through the Kontrol software, was building up to something exciting.
But even if we accept that NI did not like faders on NKS hardware, why were there no pads. And the biggest letdown for me, why wasn’t there controllers with just pads. I would have really liked to se a launchpad/apc style controller with NKS integration (and DAW control).
And a 4×4 controller or separate mode on the Machine, that was an NKS controller outside of the Maschine software.
And something like the Presonus SQ32/Fader Motion 32 controller, but with the NKS system that you could have as a controller on the desk, without having having to fit a large controller interface for playing, and that would also work on top of other controllers, like a way in to the NKS system, and with the pads giving you light guided key switches, with any controller.
I think the passage about lacking support is one of the reasons behind that I myself can testify about. In general, that isn’t something limited only to Native Instruments only, but generally speaking something that’s widespread. I have owned Kontakt collections since 2010 and despite that haven’t fully figured it all out. A trend I’ve noticed is that some developers have abandoned the Kontakt platform or are about to do so such as Scarbee. Gospel Musicians did that years ago. Soundpaint/8Dio are on the verge of doing the same, so the trust for Native Instruments are declining.
A question rather than a comment. How, if at all, is the ongoing financial stability of iZotope, Plugin Alliance, or Brainworx impacted by this development?
People on reddit are less fond of Native Instruments nowadays, I have a fair few native instruments plugins but only really use monarch for the most part…
They should leave the country.
Germany is on the decline.
Each day, more than 100 companies are going bankrupt.
I have never decided to buy Full Kontakt. I prefer individual instruments to a storage of them like this. Unfortunately, many interesting instruments depend on Full Kontakt. Perhaps it is time for them to change this dependence.
I guess their financial problem must be directly linked to their move towards the USA with Native Instruments buying Izotope,, Plugin Alliance and Brainworx almost the same year to become Soundwide…
I think that if they had not bought 3 other companies in such a short time, they wouldn’t have these financial problem, would they ?
I have no doubt they will move everything to a subscription model and alternatives will start to appear, perhaps open source. This will be years of nonsense. Glad I didn’t buy one of their keyboards.
NI should honor their agreements and provide all paying customers with version of their products that do not require access to the Internet. A username and password or serial number should be all we need to be able to install our products in perpetuity on any machine that will run them. Of course NI has no obligation to provide tech support for future operating systems or hardare. But that should not be an excuse for them to cut off access to installing our products.
NI created the cloud authorization to give us access for what we paid for, and to protect NI against piracy.
Note that these are two seperate functions! If NI is going out of business it will have no servers to authorize with. Therefore it must provide another means of fufilling its contractual obligation to give us what we paid for.
Of course it will not be possible to sue NI AFTER they go bankrupt, and at some point in the process the court will decide how much composers screwed out of their expensive priducts will get. For the lawyers out there – I would sue early in the process. And rather than suing for money damages, sue for access to the products your clients paid for.
In the past, giant companies that have expired in the past – like Bias (Peak editor) and Opcode (StudioVision Pro) -eventually just took the copy protection off their software. They figured they had nothing to protect anyore.
Finale recently was discontinued, but the company refuses to do anything to make their loyal customers able to authorize without the internet. (I started in the early 1990s buying upgrade after upgrade). Although they are not selling even old versions of Finale, they refuse to make it easier for Finale users to authorize new installs, needed when a computer dies or is sold. The authorization servers still work – for now! They changed their mionds initially stating they would turn them off in a year. So users are at their mercy. I suspect they may have made a deal with Dorico to try to encourage Finale users to crossgrade. Which is fine, unless you are holding their authorization as ransom with the threat of being cut off from a lifetime of editable files…
anyone know of an alternative?
This article allegedly provided “need-to-know” information even before the NI team. Good stuff. I hope NI comes out better than they have been over the past few years. There’s a lot to tweak and adjust in favor of the musicians, artists and producers.
WOW! This came as quite a shock today. I own tons of NI(Soundwide) software, a MIDI controller, and an audio interface. I’m kind of freaking out right now…
It is concerning since I and many users have invested a good deal of money in NI software. If at some point it is decided NI as an entity can not be saved and assets are sold off, then what happens to customers in terms of update and support?
like said by many above, if they go out of bussiness they should make all bought instruments (and kontakt) permanent
making all serial numbers lifetime and activation without internet, a serial or a piece of code that you install (and can store somewhere) to replace their native access program, this example is also why i hate internet activations (and recurring connection needed over a spicific time) and dongles, why can’t they make it like in the past, a program/instrument download with a specific serial that only works on that downloaded piece of software, i think people will sue them if their expensive instrument collection they collected over time stops working
I wonder about the incoming technology of AI. If AI has anything to do with all platforms to date. I THINK Ai technology is going to make everything useless of what platforms have offered up until now and that AI is bringing something new to the table, that everyone will adopt in the Audio and Video industries.
A total destruction of how everything operates now to make way for what is coming, that AI will lay down the new foundations of how things will operate from now on. …… .???? Who knows .????