Last week, analyst Alan Bezoza of Friedman, Billings, Ramsey issued a report calling for a round of consolidation in the cable tech vendor space. It’s an argument that pops up in every area of the industry, from shows (bye bye, Western) to MSOs (speculation on the fate of Adelphia remains cable’s favorite parlor game). The problem is the disproportionate number of big accounts and the hordes of manufacturers serving them. Take CMTS, for example. As the FBR report illustrates, the past few years have born witness to "a radical wave of consolidation" among CMTS vendors, as larger entities like Motorola and Arris have acquired lesser firms, leaving a core of 5 players (ADC, Arris, Cisco, Moto and Terayon) to chase after the same buck. While FBR does a thorough job of running down possible candidates for acquisition, it didn’t foresee yesterday’s surprise announcement from BigBand, which jumped into the CMTS space by buying up ADC’s assets. Best known for its work on the video side, BigBand’s move into CMTS may not reduce the number of warm bodies, but its multiservice offering may convince less well-positioned vendors to pull up stakes. (Of the starting 5, Cisco seems least committed to data, showing much more headway with its telephony offering. Terayon lags because it boasts only 1 major MSO deployment, with Adelphia.) In targeting CMTS, BigBand isn’t expecting a cakewalk, calling the move "a pretty bold step," but the MSO ties forged by ADC (Cox, Adelphia) remain steadfast. For its part, Terayon downplayed the notion of moving on, saying it "has no articulated plans to divest" in CMTS. The company pointed out that, in a relatively brief period of time, it has managed to differentiate itself from "the big dogs," skipping the preliminary DOCSIS 1.0 & 1.1 product rollouts in favor of a fully realized DOCSIS 2.0 launch. "It’s a crowded market, so we had to come with something demonstrably different," Terayon said.

The Daily


NBCU’s Shell Not Interested in M&A Any Time Soon

Don’t expect NBCUniversal CEO Jeff Shell to be the latest media executive to announce a major merger or acquisition. He’s more than happy with what he’s got.

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