Overall revenue from Converged Cable Access Platform solutions in 4Q 2019 was soft, continuing a trend that has prevailed throughout 2019. Revenue in 2019 was down about 28% year on year from 2018. This softness is at least partly related to the reduction in capital spend of major MSOs. In fact, scalable infrastructure spending for Charter and Comcast was down about 35% during the same period. 

Why are major operators spending less when the demand on their networks keeps growing? Part of the answer is that they have largely wrapped up their DOCSIS 3.1 deployments. But there is more.

The industry is at an inflection point. The Distributed Access Architecture (DAA) provides a good framework for operators to add capacity without a corresponding need for additional headend space and power and leads to improvements in service quality because signals become digital rather than analog. However, DAA takes operators into a new operational paradigm that demands careful planning, substantial testing, and even organizational realignment. Here are some of the issues with which operators have to contend:

• Today, the Remote PHY version of DAA is more widely deployed than Remote MACPHY because the specs and solutions are more mature. In Remote PHY, the MAC and PHY are separated unlike in the integrated CCAP; this means that operators have to address PTP timing issues between the CMTS and the Remote PHY devices (RPD)s, which can be in the access node or in a Remote PHY shelf. When Remote MACPHY is field deployed at scale, it is likely that other challenges will emerge.

• As mentioned, in DAA, signals are carried over IP. This brings significant improvements in service quality but requires a different skillset. It is true that IP expertise is more widely available, and the new environment requires less industry-specific expertise; however, OSP personnel that spent their careers dealing with RF will not become IP experts overnight. This requires training, and in some cases, new talent.

• Interoperability remains a challenge despite the valiant industry efforts under CableLabs’ stewardship. DAA is a young technology, which means that solutions are being refined as vendors and operators learn from live field deployments. As solutions evolve, interoperability testing needs to be repeated. The ecosystem will settle over time, but it is not surprising that most current field implementations are bookended (RPDs and CMTS are from the same vendor).

• Operators need to take great care to select a solution that supports all their existing services and to extensively test the new solution to ensure that all services are adequately supported and that customers will not be negatively impacted.

• The current methods and procedures playbooks need to be modified as the traditional processes for things like leak detection and set-top box control are no longer applicable in the new environment. It is true that the new environment over time will become easier to operate with much improved error prevention and remediation.

• Design of the Converged Interconnect Network; this is the Ethernet network that interconnects the CMTS cores with the RPDs. Designing and implementing such a system is not a trivial task and requires careful planning.

These are but a few examples of what an operator that is planning a move to DAA has to consider. It is, therefore, not surprising that operators are carefully and deliberately developing their migration plans. For those that have witnessed other instances of new technology introduction in the live network of an operator, such a measured pace is normal and expected. It is not the first time that a new technology gets hyped up with aggressive forecasts for field introduction but inevitably meets the laws of gravity.

Business dynamics remain healthy

Despite headwinds from so-called cord cutting because of the increasing consumption of online video content and attrition from myriad and growing SVOD and other online video competitors, cable operators had a good year in 2019 as growth in the broadband business continues unabated, and business services become a major contributor to revenue. In fact, the stocks of the two largest MSOs Comcast and Charter, posted sequentially 60% and 25% growth through December 2019 (albeit in a buoyant stock market).

According to a recent report by analyst firm MoffettNathanson, cable operators are projected to continue to grow their broadband business for the foreseeable future, grabbing more share from the telcos. At the same time, business services remain a healthy and growing revenue contributor, and the more innovative MSOs have created vibrant business offerings with services such as SD-WAN to the SMB market. Comcast’s revenue from business services was 13.4% of cable revenue for the nine months ending September 30, 2019.

It is true that there are rumblings in the industry about the potential competitive threat from 5G in the form of fixed wireless access; although 5G might over the long term become competitive with cable both in the forms of wireless broadband substitution and fixed wireless access, the state of the technology and cost parameters do not make such solutions economically viable in the near term, and furthermore, cable may indeed reap economic value from 5G (more on this later).

Software-based solutions will gain field traction

Although it is true that 2019 through end of September was not a good year for CCAP vendors in aggregate, with the nine months revenue declining about 30% over the same period in 2018, a closer examination of the revenue make-up tells a different story. The revenue of vendors whose solutions are primarily hardware-based declined about 33% in that period; vendors with software-based solutions saw about 11% in revenue growth, with 41% revenue increasing in the third quarter. Although it is true that some operators slowed down capital investments as their DOCSIS 3.1 rollouts tapered off and as they deployed already purchased equipment, but as they look ahead, many operators are also assessing whether their traditional playbook will continue to sustain their future growth and competitiveness or if they should explore more forward looking alternatives. 2020 will see more meaningful growth in deployments of software-based solutions, particularly as more solutions come in the market. Looking back, 2019 may have been a transition year.

Remote-PHY, Remote-MACPHY or Remote-X

It is unquestionable that the distributed access architecture (DAA) has been getting some traction, led by Comcast’s public commitment to Remote-PHY. This technology, based on the CableLabs specifications issued in 2015, has gained a beachhead over its cousin, Remote-MACPHY, whose spec is under development at CableLabs. Although some operators and vendors have settled on an architecture, there is a growing trend toward flexibility with vendors offering the option to locate the MAC either centrally or on a remove device. DAA will get more traction in 2020, as deployments are now real, and the new technologies are field proven and showing clear benefits.

DOCSIS 4.0 will inch closer to reality

CableLabs is expected to issue the DOCSIS 4.0 specifications, which include Full Duplex DOCSIS (FDX) and Extended Spectrum DOCSIS (ESD), for spectrum up to 1.8GHz to enable symmetrical upstream and downstream bandwidth. This will help the vendor community chart its way forward on meeting the need for significantly increased upstream bandwidth. Deployments of this technology are well beyond 2020.

Business services

Cable operators will continue to generate an increasing share of their revenue from lucrative business services. Having established a beachhead in the SMB market where they have a natural affinity, they are putting more emphasis on the middle market and the enterprise market. SD-WAN is a particular area of promise for cable operator. Comcast, which entered this market early and aggressively, will continue to grow its momentum. Other operators have started their deployments and will grow from there. Other promising services include WIFI and security.

5G will progressively materialize as an opportunity for MSOs

It is undeniable that cable operators have become a force to be reckoned with in wireless, largely through their MVNO based service offering. However, it is also well understood that a business largely built on reselling a competitor’s service is not the best way to create long-term value, and indeed MSOs have been exploring a number of alternative business models. Charter has made no secret of its plans to use CBRS to supplement its HFC reach in some areas and may well introduce this solution in 2020. An even more intriguing opportunity is the use the extensive HFC network to backhaul 5G traffic. 5G will require a dense infrastructure of small cells; the cable HFC network, with assets and power in the local access network, may prove to have the right infrastructure for the 5G small cells backhaul. This said, 5G will require very low latency, which today’s DOCSIS technology cannot provide but a new industry effort, Low Latency X-Haul (LLX), is striving to resolve this limitation. Much progress will be made on this front in 2020, potentially setting the stage for an exciting opportunity for MSOs for years to come as 5G becomes a market reality.

Liliane Offredo-Zreik (@offredo) is principal analyst atACG Research.

Total cable access “concentrator” revenue declined 31% year over year in the third quarter to $287 million, driven by a continued slowdown in North American CCAP license purchases, according to research company Dell’Oro Group.

The finding, nonetheless, represented an improvement over the second quarter, during which cable access equipment revenue dropped 40% to $237 million.

Overall broadband access equipment revenue decreased 12% in Q3, with a 371% spike in XGS-PON OLT revenue, as well continued growth in XG-PON1 OLT ports and CPE, offsetting the slump in North America converged cable access platform (CCAP) sales.

“Operators’ continued push to increase their fiber investments is resulting in strong Y/Y gains in PON OLT ports,” said Jeff Heynen, Senior Research Director at Dell’Oro Group.

The U.S. cable access market continues to be roiled by technological disruption, with operators pausing orders as they plan migration to network virtualization and distributed access architecture (DAA).

Perhaps more impactful, leading operators Comcast and Charter Communications are reporting healthy growth in subscribers and revenue for broadband services, reducing the incentive to spend money on their networks. 

Casa Systems wild ride on the Nasdaq took a sharp upward turn after the technology company reported a sales rebound in the second quarter.

The telecom tech company reported Q2 revenue of $52.1 million, meeting guidance. The performance was off significantly from the year-ago revenue haul of $68.7 million, but represented a strong 47% increase over Casa’s moribund first-quarter sales. Casa and other cable access tech vendors reported stagnant orders in Q1, as operators stood frozen in place, mulling migration to distributed access architecture (DAA) and converged cable access platform (CCAP) virtualization. 

But orders are now coming in.

Casa’s stock price increased more than 15% Thursday after falling around the same percentage earlier in the week. That was after Raymond James analyst Simon Leopold downgraded the company, suspecting one of the large European companies now buying millions of dollars worth of DAA and virtualization gear and software from competitor Harmonic is actually major Casa client Liberty Global.

Casa CEO Jerry Guo told investors that he expects to see a continued sales uptick, “driven by capacity-related purchases by our cable customers and revenue recognition from wireless backlog.”

Guo said Casa is also establishing its own momentum with virtualization and DAA tech sales.

“In fact, our cable trials increased in the quarter by 53%, the vast majority of which was driven by existing and new consumer interest in our DAA, virtual CCAP core and new BDM products,” said Guo.

Global spending on cable access technology decreased 38% year over year in the first quarter to $275 million, with operators in North America and Europe delaying CCAP purchases as they mull moves into Distributed Access Architecture, according to research company Dell’Oro Group.

According to Jeff Heynen, the analyst behind the report, operators are “pushing off new capacity purchases while they determine how to move forward with distributed access architectures.”

This assertion certainly jibes with the explanation of leading Converged Cable Access Platform (CCAP) vendors including CommScope and Casa Systems, explaining first-quarter declines in CCAP revenue.

CommScope reported an 18% Q1 revenue slide in its network and cloud business, while Casa said its business declined 55.6% during the quarter.

“We’re seeing an industrywide slowdown as cable operators implement a shift to virtual CCAP and DAA,” Casa Systems CEO Jerry Guo told investors, describing a “quarter we’re not at all happy with.”

The Dell’Oro report said deployments of 10 Gbps-capable fiber-to-the-home networks, such as the one Altice USA is building in its Optimum footprint, drove increased shipments of XPON1, XGS-PON and NG-PON2 OLT ports.

Overall network access business was only off 2% to $2.9 billion during Q1.

“The 10 Gbps FTTH deployments continue to build momentum,” Heynen said. “The next-gen fiber increases nearly offset the weakness in cable CCAP spending.

And while tier 1 operators are like Comcast and Charter Communications are largely done with the CCAP purchasing needed to build their DOCSIS 3.1 networks, deployments of 1-gig-capable modems is ongoing.

Dell’Oro found a 19% uptick in CPE units shipped during the first quarter. 

CommScope is making its first appearance at ANGA COM in Cologne, Germany since acquiring Arris, and it will be subsequently demoing a range of new DOCSIS-enabled cable network technologies, as well as its own virtual CCAP.

With insurgent makers of software-powered Converged Cable Access Platform (CCAP) tech such as Harmonic and Nokia nipping at its heels, CommScope is showing off the E6000 vCore, a fully virtualized CCAP that it says is already in trials, with “significant deployments anticipated later this year.”

CommScope’s virtualized CCAP will initially run on the company’s dedicated CCAP hardware, the E6000. But it will soon move to support Intel-powered x86 servers as the vendor’s cable operator clients move into Distributed Access Architecture (DAA).

Meanwhile, with wireless competitors touting the ultra low latency of their developing 5G networks, CommScope is demoing a low latency version of DOCSIS that will reduce typical latency from around 25 milliseconds to around 1 millisecond.

CommScope’s demo will compare gaming applications on regular service flows against games running over prioritized low-latency flow. Among many other applications, low-latency DOCSIS, the company noted, will be crucial to gaming and virtual reality performance, as well as collision-avoidance systems in self-driving cars.

Also being demo’d: Frequency-Division Duplex (aka Soft FDD), which allows operators to remotely conduct frequency splits via software. Soft FDD uses Full Duplex DOCSIS technology and provides a foundation for symmetrical services, CommScope said

“Residential home networks now rival enterprises in both demands from internet-connected devices and for performance of managed services,” said Kevin Keefe, CommScope’s senior VP and segment leader, network & cloud. “We are developing technology and architectures that result in smarter, adaptive networks. With these announcements, we’re accelerating the march toward virtual, automated and orchestrated infrastructure capable of delivering massive amounts of capacity and bandwidth.”

Casa Systems became the latest cable access technology vendor to report a really tough first quarter, with revenue off a whopping 55.6% to $35.5 million.

The Q1 report from the Andover, Mass.-based Casa follows a similar call from competitor Harmonic earlier in the week, one which revealed a 30% slide in cable access sales for the first quarter.

“We’re seeing an industrywide slowdown as cable operators implement a shift to virtual CCAP and DAA,” Casa Systems CEO Jerry Guo told investors, describing a “quarter we’re not at all happy with.”

Related: Harmonic: Volume Deployment of CableOS is on the Way

Guo cited recent figures from S&P Global, which noted that cable access tech sales were off 26% combined in the fourth quarter for the category’s three biggest vendors, Arris/CommScope, Cisco and Casa Systems.

As Harmonic did two days earlier, Casa said his company’s clients are engaged in an abundance of active trials for virtualized Converged Cable Access Platform (CCAP) and Distributed Access Architecture. Guo cited 67 trials in all.

But as operators mull a revolutionary way to build out their networks, “we’re in a holding pattern,” Guo conceded.

Casa Systems has tried to diversify its product lines towards wireless convergence recently. But Q1 sales in this emerging category didn’t come close to offsetting the slowdown in the company’s core integrated CCAP business.

Speaking more broadly about the CCAP situation, Guo cited the massive investments made by MSOs in recent years to deliver gigabit speeds.

“The pace of network upgrades has slowed significantly as the industry has moved to capacity filling vs. the buildout phase,” he said.

Notably, also like Harmonic, Casa Systems is banking on MSO clients getting off the dime on the emerging cable access tech paradigms and rolling out some deployments later this year. Casa is still forecasting $250 million - $300 million in full-year 2019 revenue.

“We believe we are at an important juncture in the development of our business and I remain confident that our recent results are not indicative of the company’s large future opportunity,” Guo told investors. 

San Jose, Calif. cable technology vendor Harmonic saw a 12% year-over-year revenue spike to $113.6 million in the fourth quarter on the strength of its CableOS virtual CCAP platform.

Revenue for the company’s cable access segment increased 79% to $24.1 million, with gross margins in the quarter reaching 43.6%.

CableOS, a software-based iteration of Converged Cable Access Platform (CCAP), is in 29 commercial and field trials currently, Harmonic said. Participating companies include four out of the top eight North American and European cable operators.

Harmonic said 535,000 cable modems are being served globally by CableOS network technology, an 11% increase over the third quarter. Related to the move toward virtualization, Harmonic said it shipped 1,000 notes designed for the emerging paradigm of Distributed Access Architecture during Q4.

“These initial CableOS deployments are primarily in a traditional centralized CMTS architecture with a typical application as DOCSIS 3.1 upgrade, and virtualized software economics, and future distributed network migration flexibility underpinned our competitive advantage. We expect continued momentum during 2019 for these more traditional applications,” said Harmonic CEO Patrick Harshman, during Monday’s earnings conference call.

Referring to DAA as a “cousin” of virtualization, Harshman said he doesn’t envision the copious ongoing trial activity surrounding DAA to translate into swift commercial sales until late this year.

“Based on challenging, but groundbreaking progress made over the past several months, we expect the volume of 2019 deployments of new Distributed Access Architecture or DAA networks with multiple tier 1 operators,” he said.

“During this quarter of Q1, we will still be on the on-ramp, continuing support of lead customers who are now in the process of implementing specific trial informed improvements to their deployment plans, not to the CableOS core, which has been solid for some time, but rather to ancillary networking and orchestration elements of our customers end-to-end DAA implementations,” Harshman added.

Harmonic also saw video segment revenue increase by 22% to $89.5 million, driven partly by a 58% sequential uptick in UHD shipments.

Despite a strong fourth quarter that met guidance, Harmonic signaled that Q1 will be below guidance, sending its stock price down double digits in after-hours trading. 

Casa Systems saw a 4.1% spike in third-quarter revenue to $71.5 million and said tariffs placed by the Trump Administration on select Chinese electronics imports are not hurting its business.

“I'm pleased to say that these tariffs have not--and we expect will not--have a significant impact on our business in 2018,” said Shaun McCarthy, interim CFO for Casa, speaking during the company’s third-quarter earnings call last week. (A transcript was provided by Seeking Alpha.)

Related: Casa Systems Files for $150M IPO

“We have completed our review of our supply chain and are not expecting a significant impact to our costs for 2019,” McCarthy added. “We have a flexible manufacturing and supply chain and plan to monitor developments in this area to minimize the tariff-related impact to our cost profile going forward.”

Andover, Mass.-based Casa makes cable modem termination systems and converged cable access platform equipment for the cable industry.

Related: Arris Says Trump Tariffs Will Add $200M/Year to U.S. Broadband Equipment Costs

McCarthy’s comments came a week after Arris told the FCC that the tariffs could drive up the annual industry cost for broadband components by $200 million a year.

Casa Systems cut its revenue guidance by $50 million for the rest of the year this week, explaining that its cable operator clients are putting off longterm investments on network expansion as they mull their big moves to virtualized architectures.

Speaking to investors during Casa’s second quarter earnings report, company president and CEO Jerry Guo said customers are making only short-term investments on network capacity expansion, eschewing high-capacity purchases of Converged Cable Access Platform hardware as they mull their strategy on next-generation Distribute Access Architecture (DAA).

Related: Casa Systems Shrinks IPO Size to 6M Shares at $13 Each

“Over the last few weeks, it has become clear to us that we are witnessing a pattern shift in procurement in the cable market,” Guo told investors, according to a transcript provided by Seeking Alpha. “While our customers weigh the timing for their large-scale rollout of the next network architecture, they are choosing to only procure capacity in a short-term basis. And they're not making very long-term upgrades of the chassis-based products in some cases.

“We do see DAA delayed industry wide in terms of large scale deployment,” Guo added. “And given that a lot of operators are contemplating DAA, they are slowing down their spending in their current capacity expansion.”

Guo said believes larger scale DAA deployment will begin in 2019.

Of course, none of this is helping Casa’s bottom line in the short term. The company’s stock is down around 23% since its Tuesday earnings report, during which it cut full-year revenue guidance to as low as $330 million.

Casa reported second quarter revenue of $68.7 million, up 3.1% from the year-ago quarter, but down 23% from the first quarter of this year.

Cable MSOs sit in one of the more disrupted spots in the communications industry. By disrupted, we mean the easily changeable nature of customer loyalty, as consumers react to a less-than-perfect experience and the growing influence of other communications entities trying to acquire those customers. 

Consumers these days are increasingly willing to cut the cord and migrate to less-expensive streaming alternatives such as Roku, Google Chromecast and Apple TV. Leichtman Research Group data shows the clear reason why. An annual survey of TV households shows the average cable bill rose about 39% from 2011 to 2015, which is almost eight times the rate of inflation. The most recent cable bill average is now over $103 per month, with zero chance of that price remaining flat going into the next year.

Threats on Multiple Fronts

Bill sticker shock notwithstanding, cable providers must now face the new challenge of the eventual introduction of 5G networks delivering Gigabit performance, new fixed wireless access options and yet another unique ability to create a bundled offering that displaces the cable provider completely. Can you blame a customer with a high bill for looking at other options, especially from companies that can bundle services together just as well?

Cable MSOs have thus been forced to reshape their businesses, with much of that coming in the form of a complete digital transformation of infrastructure, and processes that help meet the expectations of consumers and business customers. Today’s cable networks have brought broadband access to households that now have become accustomed to HD and 4K video services and internet speeds of 100 Megabits per second-plus. Over the next few years, we can expect further digital transformation in the form of hybrid networks that provide higher capacity, less risk of delay or latency, lower power consumption and hopefully the ability to satisfy the end users’ demand for service at a price point that doesn’t increase the rate of cord-cutting.

With demand for internet bandwidth continuing to grow at more than 20% per year thanks to video streaming, enterprise cloud computing, big data, social media and mobile data delivery, meeting these demands must be cost-efficient, energy-efficient and reliable.

As we watch top-tier cable providers invest in fiber-to-the-home deployments, cable’s traditional fiber-coaxial networks will still provide the anchor points for service evolution and transformation, and will still have the capability to roll out new services, as ongoing investment has already been able to deliver more bandwidth.

Ongoing investments in the Converged Cable Access Platform (CCAP) and DOCSIS 3.1 have benefited the customer, with bandwidth performance metrics showing upwards of 10 Gbps downstream and 1 Gbps upstream. The embrace of CCAP has the transformative effect of increasing business agility, forging a smaller footprint, and creating lower power consumption and more IP video capability, giving the user more capabilities and enhanced security — all of which should help reduce total cost of ownership as a whole.

As SDN/NFV (software-defined networking/network functions virtualization) becomes a greater influence on the cable provider, one cannot discount the existing expectations and needs for what will be a hybrid network environment in the short to medium term. Cable providers will thus have physical and virtual functionality evolving in parallel. This, along with investments in remote PHY, which supports both FTTx (fiber to the x) and SDN/NFV initiatives, all contribute to the digital transformation around an IP network between the core and the node. The move to a virtualized, software-based architecture can help deliver network optimization, increase agility and create new opportunities for MSOs. However, any cable operator planning to reap the benefits from NFV and SDN must shift its focus from technology to business, and ensure all business support systems are up to the task. As a wise man once said, if you can’t bill for it, it’s a charity.

Virtualization Hits Home

Network-level virtualization will also transfer to the home, as we already see services move from a physical set-top box environment to an eventual virtual one. The $400-plus set-top box with a hard drive is set to be replaced by a cloud-based DVR that sources not just content, but applications such as program guides and DVR as cloud-based functions.

Cable MSOs will no longer be limited by the functionality of a dedicated set-top box and will make gains from much faster time to market for new products and services offered both from within and outside the cable provider. How about that customer call requiring a $100-plus truck roll to correct an issue that may or may not exist? It can likely be mitigated by a remote software update. What about replacing that $400 set-top box every three years or so? Virtual CPE means a $50 dumb box in the home can extract value from the cloud and be easily updated and configured on the fly and extends the life of home-based equipment. Analytics can also now be embedded in the cloud for easier data management and decision-making.

Can we calculate a long-term price for all of this digital transformation? For the cable provider, it means more innovation, faster delivery of new digital services and a much “stickier” service environment to demonstrate to the customer that all this innovation is actually worth paying for. That translates to retention.

And let’s face it: If cable bills aren’t going down any time soon, creating a product and service advantage will be a paramount requirement for the industry in the coming years.

Paul Hughes is director of strategy at Netcracker Technology.

After going public late last year, Casa Systems, a maker of cable and wireless network gear and software, said Q4 2017 revenues rose 18.9%, to $118 million, driven largely by software-based capacity expansions by cable operators.

RELATED: Casa Systems Shrinks IPO Size to 6M Shares at $13 Each

That was paired with GAAP net income of $28.9 million, down 27.6% versus the year-ago quarter.

For the full year, revenues rose 11.2%, to $351.6 million.

Though new wireless opportunities are starting to kick in, cable’s move to DOCSIS 3.1 to deliver gigabit-class speeds remains a key growth driver at Casa, company president and CEO Jerry Guo said Tuesday on the earnings call.

And while some operators, such as Comcast and WideOpenWest and Mediacom Communications, have moved aggressively with D3.1, Casa expects deployments to ramp up this year and into 2019.

Cable is generally at the “initial stage” of D3.1, Guo said, adding that there’s “a lot more to come.”

Though integrated Converged Cable Access Platform (CCAP) products have plenty of legs left, he also sees cable’s ramp toward distributed access architectures ramping up in 2019 and beyond.

RELATED: Ramping Up for Remote PHY

Casa also talked up its ongoing move into wireless – including a focus on 4G, small cells and cellular IoT cores -- recalling recently announced wins with Telefonica (for its 4G Apex Small Cells and small cell management platform); and with China Mobile and Sprint, which are both using Casa’s Axyom Small Cell Core product.

Casa said it expects revenues for fiscal year 2018 to be in the range of $380 million to $395 million, with non-GAAP net income of between $100 million to $111 million.

Some of Casa other known customers include Charter Communications (coming way primarily from Charter’s  acquisition of Time Warner Cable), Rogers Communications and Mediacom Communications in North America; Televisa/IZZI Mexico and Megacable Mexico; Claro Telmex Columbia; Liberty Global, Vodafone and DNA Oyj; and Jupiter Communications and Beijing Gehua CATV Networks in the Asia Pacific region.

Update: Via Twitter, Jeff Heynen, consulting director at SNL Kagan, noted that Casa’s turning in of a solid Q4 wasn’t a surprise, but wondered if Casa could maintain consistency throughout the year: 

Casa has historically had strong Q4s. The big question is whether the revenue troughs in subsequent quarters can be minimized. https://t.co/QyEjkbBGGs

— Jeff Heynen (@jeffheynen) March 7, 2018

Raymond James analyst Simon Leopold maintained his “Outperform” rating on Casa following its Q4 results, noting that the numbers exceeded expectations (sales of $118 million beat Wall Street consensus of $101.4 million), and Casa's 2018 forecast was a bit better than consensus.

“We expected seasonal strength in the software portion of Casa's business, which largely stems from capacity additions, but the results were well ahead of expectations at $50 million vs. our $38 million estimate,” he wrote, adding that the favorable mix fueled the gross margin to 77.1%, above his expectation of 69.9% and the Street's expectation of 68.5%.

Rising prices on memory will continue to have an adverse effect on Arris’s set-top box business this year, though perhaps not quite as much as they did in 2017.

“Increased DRAM prices have clearly affected ARRIS, degrading EBITDA by over $100 million in 2017,” Simon Leopold, analyst at Raymond James, pointed out in a research note based in part on his discussion yesterday with Arris CFO Dave Potts at the firm’s 39th Annual Institutional Investors Conference. “Although the rate of increasing costs has slowed, ARRIS is not anticipating a reversal in 2018.”

He noted that much of the DRAM used by Arris goes into set-tops, which contribute about 45% of sales.

Arris has already started to outline how it will address the memory cost issue and drive more efficiencies into its CPE business, noting last month that it will be “more selective” with set-top deals, with an emphasis on profitability more so than sales growth.

RELATED: Arris to Be ‘More Selective’ With its Set-Top Box Business

Likewise, Arris is “in extensive discussions with customers to adjust pricing to reflect increased memory costs, and are being increasingly more selective on the projects that we pursue,” Bruce McClelland, Arris’s CEO, said on the company’s Q4 call last month.

Though set-tops are a big part of Arris’s business today, the company has been branching out to adjacent areas, like mobile and wireless and enterprise, via its acquisition of the Ruckus Wireless and ICX Switch businesses from Brocade soon after Brocade’s merger with Broadcom.  

Such moves give Arris “exposure to an adjacent market and helping it drive growth and provide diversification,” Leopold noted, adding that the company reiterated a growth expectation of 20% year-on-year in that segment as wireless marks a “natural progression” for Arris.

He added that Arris also expects the mix of sales to cable operators to shift to network investments and transmission products and away from set-tops and other CPE, with an expected benefit going to sales of Arris’s converged cable access platform (CCAP) gear and software and as MSOs start to move to distributed access architectures.

And Potts reiterated Arris’s stance that M&A will continue to be consideration in Arris’s growth strategy, though plans for capital allocation will be balanced to include buybacks, Leopold said.

"Yes, I think M&A will continue to be part of what we do," Potts said, according toLight Reading. "What I worry about in five years from now if we aren't continuing to add, what is it that we will have? Who will we be as a business?"

Looking to give MSOs more flexibility on how they buy and deploy access network capacity, Cisco Systems this week launched Infinite Broadband Unlocked (IBU), a licensing program for the cBR-8, a flagship converged cable access platform (CCAP) that supports cable services and the new DOCSIS 3.1 platform.

Cisco said the program aims to improve the economics of delivering multi-gigabit services using emerging distributed access architectures that employ Remote PHY and push key electronics toward the edge of the network.

RELATED: Cable-Tec Expo: Ramping Up for Remote PHY  

Rather than using traditional licensing models for CCAP devices that require MSOs to buy large numbers of new bandwidth licenses for every service group where they want to offer the expanded service, the IBU model has only one license type based on bandwidth consumption, Cisco said.

That gives cable operators the ability to provision all of the capacity of their CCAP platforms without restrictions or upfront licensing expense, the company claimed, noting that the IBU licensing plan is available for current and new Cisco cBR-8 customers worldwide.  

Further, Cisco believes that the approach will promote the provision of multi-gigabit service tiers across MSO footprints without the risk of stranding capital while also simplifying service group splits by eliminating the need to purchase additional license types.

“IBU helps cable operators be more competitive and gain subscriber market share,” Sean Welch, vice president and general manager, Cable Access, Service Provider Business, Cisco, said in a statement. “We have listened carefully to our customers, and with this new offer we have specifically focused on making DOCSIS licensing simple and aligned with their business objectives.”

Casa Systems, a maker of cable modem termination system and converged cable access platform gear and software, is aiming to raise up to $150 million in an IPO, according to an S-1 filed on Friday (November 17).

Casa Systems said it plans to list its common stock on the NASDAQ market under the “CASA” symbol. Underwriters for the offering include Morgan Stanley, Barclays Capital, Raymond James & Assoc., and Stifel, Nicholas & Co.

Founded in 2003, Andover, Mass.-based Casa cut its teeth on field programming gate arrays (FPGAs) alongside its eventual development of DOCSIS 3.0 CMTSs in 2008, an integrated CCAP in 2012, a DOCSIS 3.1 chassis in 2015, and, last year, its move into the distributed access architecture (DAA) and Remote PHY arena.

RELATED: Cable-Tec Expo: Gearing Up for Remote PHY

Casa, which has also been investing heavily into wireless systems, competes with vendors that include Arris, Cisco Systems, Harmonic, Huawei, Vecima Networks, and Nokia, which recently acquired virtual CCAP startup Gainspeed.

RELATED: Nokia Closes Gainspeed Buy

With an eye toward network virtualization, Casa has also developed Axyom, a software-powered architecture for a range of core and access network functions for fixed and wireless networks. Its Axyom software platform, for examples, supports apps such as security gateways, small cells and WiFi gateways, and the evolved packet core.

Casa, which has been holding its own over larger rivals such as Arris and Cisco in the cable tech sector, said its products are now commercially deployed in more than 70 countries by more than 400 customers. Examples or major customers include Charter Communications, Rogers Communications and Mediacom Communications in North America; Televisa/IZZI Mexico, Megacable Mexico and Claro Telmex Columbia in Latin America; Liberty Global, Vodafone and DNA Oyj in Europe; and Jupiter Communications and Beijing Gehua CATV Networks in the Asia Pacific region.

Though most of its revenues come way of its cable access (CMTS and CCAP) products, Casa has been branching into wireless technologies and products.

RELATED: Casa Systems Builds Wireless Annex

“We believe that the shift to software-centric ultra-broadband networks and fixed and wireless network convergence presents us with a compelling market opportunity,” Casa said in the S-1. “We intend to maintain our technological leadership through the enhancement of existing products and the development of new products in both our current and adjacent markets.”

Per the S-1, Casa pulled in revenues of $233.6 million through the first nine months of 2017 (with $125.3 million from North American customers), up 7.7%, and net income of $59.6 million, up 22% versus the corresponding year-ago nine-month period

For all of 2016, Casa had revenues of $316.1 million and net income of $88.7 million, up 16% and 30.5%, respectively 

Update: Casa has been heavily reliant on revenues from the operations that were formerly Time Warner Cable, the MSO acquired by Charter in May 2016. Through the first nine months of 2017, former TWC accounted for 36% of Casa’s revenues (and 23% for all of 2016). By comparison, Liberty Global accounted for 11% of revenues for the first nine months of 2017, and 10% for all of 2016. Sales to Rogers accounted for 11% of Casa’s revenues for all of 2016.

As of Sept. 30, 2017, Casa had cash and cash equivalents of $183.51 million, and long term debt of $298.14 million.

Casa had 664 full-time employees as of Oct. 31, 2017, with 347 located in the U.S.

Jerry Guo founded Casa and serves as its president and CEO. Before founding Casa, he was VP of broadband at River Delta Networks, a CMTS startup acquired by Motorola in 2001 for $300 million. Before that, he was a research scientist at Bell Laboratories’ research division. 

In 2016, Guo was paid total compensation of $5.3 million, including salary, bonus, stock awards, option awards and other compensation factored in.

Guo currently owns 2.39 million shares of Casa, or 15.9% of the company. Among other backers, Liberty Global Ventures Holding has a 6% stake.

Harmonic said its chief financial officer, Harold Covert, will resign in the coming months, but will stay on until the vendor files its 2016 annual report and the appointment of a new CFO.

In a release about the transition, San Jose, Calif.-based Harmonic said Covert was resigning so he could spend more time with his family on the East Coast.

In a memo to Covert filed with the SEC, Harmonic said it understood the exec’s “desire to transition out of the CFO position because of the strain that your extensive travel has placed on your family.” Per the document, Harmonic will provide Covert with a one-time bonus equal to six months of his base salary under certain conditions, including his staying on through the filing of the aforementioned annual report.

Covert stepped down from the Harmonic board last fall to assume the CFO role, replacing then-CFO Carolyn Aver, who left to help her husband run their family winery.

Harmonic said it has launched a search for a new CFO and that Covert “has agreed to provide any needed assistance to ensure a smooth transition.”

“On behalf of the Harmonic Board of Directors and management team, I want to express my gratitude to Hal for stepping off the Board last year and into the CFO role during an important period of strategic change and acquisition integration,” Patrick Harshman, Harmonic’s president and CEO said in a statement. “We thank Hal for his contributions and his continued leadership during the transition period.”

Prior to his role at Harmonic, Covert served as CFO of several tech companies, including Lumos Networks, Silicon Image, Openwave and Adobe, and on the board of public companies that include Lumentum, JDS Uniphase and Harmonic.

In a research note issued today, Raymond James analyst Simon Leopold said the firm regard’s “C-level departures, in general, as a yellow flag that highlights potential risk.”

He also noted that the change comes as Harmonic looks to “restore the business to organic growth,” citing its plan to target the market for a new class of distributed Converged Cable Access Platform architectures and products, where it will face off with vendors such as Arris, Cisco Systems, Casa Systems, Huawei, and Nokia, which acquired virtual CCAP startup Gainspeed earlier this year.

RELATED: Harmonic Virtualizes the CCAP

For its part, Harmonic has introduced a virtual CCAP, called “CableOS,” Soon after, it announced a warrants deal with  Comcast based largely on sales and deployment milestones of the new CableOS platform.

Arris International has promoted industry vet Dan Whalen to president of its Network & Cloud division, which makes and sells broadband and video infrastructure and software products.

He assumes the role previously held by Bruce McClelland, who succeeded Robert Stanzione as CEO effective Sept. 1.  

RELATED: Stepping Up To The Plate

Whalen, who reports to McClelland, previously served as Arris’s SVP and GM of global services. He is also late of Cisco Systems, KPMG and Bell Atlantic.

In Q3, revenues at the Network and Cloud unit had a small decline amid the transition to second-gen linecards for the E6000, the company’s flagship converged cable access platform (CCAP), but that was largely offset by a record quarter for Arris’s access technologies business.

RELATED: Arris ‘On Track’ to Hit Full-Year Guidance

"Dan played an instrumental role in scaling ARRIS's Global Services business into a key enabler of complex customer deployments around the world," McClelland said in a statement. "His proven track record of success, breadth of customer leadership, and strategic insights provide an excellent foundation for helping our Network and Cloud business achieve the next era of growth."

"ARRIS is at the forefront of the technologies driving tomorrow's advanced entertainment and communication services for millions of subscribers worldwide," added Whalen. "I am honored to continue collaborating closely with our global base of customers, to deliver the next generation of broadband, video and mobile services and applications."

Casa Systems is using this week’s Cable-Tec Expo in Philadelphia to introduce a virtualized core for the Converged Cable Access Platform as well as for 4G/5G cellular and WiFi capabilities.

Casa, which has previously centered efforts on more centralized forms of the CCAP, will demo a vCCAP that uses the vendor’s Axyom software architecture, which provides a common security framework for the independent scaling of control and data plane functions, the company said.

RELATED: Cable-Tec Expo: Nokia Puts Gainspeed Buy to Work

The supplier said its latest product line features virtual MAC layer data processing, control and management functions, and that its family of distributed access nodes for PHY layer processing in cable networks are supported by both the new vCCAP product and its chassis-based CCAPs, such as the C100G and C40G.

Casa Systems joins a group of access network suppliers focused on cable that have launched or are developing virtual CCAPs, including Arris and Nokia, among others.

Casa (booth 665) hasn’t announced any deployment deals for the virtualized approach, but some of its announced partners include Interop Technologies, Jupiter Telecommunications, DNA Ltd, Mediacom Communications, Wave Broadband and Time Warner Cable (now part of Charter Communications).

In addition to the vCCAP demos, Casa will also be showing off its Video over DAA (Distributed Access Architecture), DOCSIS 3.1 gear and Axyom LTE based Wi-Fi calling, and Secure Wi-Fi MDU products. 

Roughly two months after salting away its acquisition of Gainspeed, Nokia has unveiled a virtualized version of the Converged Cable Access Platform (CCAP) that spans support for HFC- and PON-delivered services and applies a vision for the industry’s all-IP future.

Nokia timed the announcement with this week's SCTE/ISBE Cable-Tec Expo in Philadelphia. 

Get complete coverage of Cable-Tec Expo 2016

Nokia’s vCCAP, which factors in a shift toward energy- and bandwidth-efficient distributed access architectures that push transport electronics toward the edge of the network, is comprised of a mix of products that incudes elements acquired via Gainspeed and developed previously by Nokia. They include the Gainspeed-branded, software-driven Access Controller, Video Engine, and access nodes that support DOCSIS 3.1 and DOCSIS 3.1 (the SC-2D), and another access node that supports 10G EPON (the SF-4X). Nokia said the new solution will be commercially available later this year, with the SF-4X slated for launch in early 2017.

Currently in a number of customer lab and field trials across North America and Europe, the new unified cable access solution will be available commercially later this year with the SF-4X following in early 2017.

“We’ve been aggressively working together and integrating Gainspeed into the Nokia family, both the people and the products,” Jeff White, head of cable strategy and business development at Nokia, who joined the company from Gainspeed following the acquisition,” said, noting that the system is capable of managing and orchestrating not just CCAPs but other types of media and devices on the network and accelerate the deployment of new services.

While remote PHY architectures are becoming popular among some vendor products, Nokia’s approach is to distribute both the MAC and PHY elements. The platform’s Video Engine will help MSOs adapt their video services to the new Ethernet-powered network while keeping their legacy components intact.

White said Nokia’s angle will help MSOs reduce power and space requirements at headends that are outfitted with centralized, “big iron” CCAP chassis as capacity demands continue to rise. It can also prolong the need for MSOs to pull fiber to the premises, or at least put them in position to do so further down the road.

“As capacity grows at a fast clip, doubling every two years, they [cable operators] are literally running out of space in the headends,” White said.

Nokia will be using the new vCCAP product line to compete with cable access rivals such as Arris, Cisco Systems, Casa Systems, Harmonic and Huawei.

“The virtual CCAP is a legitimate phenomenon,” Jeff Heynen, consulting director and analyst at SNL Kagan, said in an interview for a feature story on this topic that will be featured online and in Cable-Tec Expo dailies that will be distributed this week by Multichannel News (link to preview edition). “I think this is an opportunity with vendors without share to get some traction.” 

White said Nokia is pursuing a wide range of deployment scenarios, including those specific to multiple-dwelling units (MDUs), as operators consider alternative architectures as they split nodes and go “fiber-deep,” and even putting its new platform side-by-side with legacy platforms. Yet another option, he said, is the notion of removing an existing CCAP and converting headends and hubs to virtual and distributed systems.

Nokia has not announced any specific trials or deployments with MSOs, but said it is in multiple customer lab and field trials with “major” operators in North America and Europe.

When the Nokia-Gainspeed deal was announced, Comcast, Liberty Global and WideOpenWest all praised the acquisition, with WOW noting that it was testing Gainspeed’s platform and “preparing for deployment.”

Gainspeed, based in California, was founded in 2012 by Shlomo Rakib, a DOCSIS pioneer and co-founder of Terayon  Communication Systems (sold to Motorola in 2007). Nokiaannounced its agreement to acquire Gainspeed on June 9.

Casa Systems said Jupiter Telecommunications (J:COM), Japan’s largest cable operator, are getting a bit tighter on the tech front. 

Casa said J:COM will tap its C100G converged cable access platform (CCAP) for the convergence of its data and video services on a unified platform. CCAPs are high-density platforms that support both the functions of the cable modem termination system and the edge QAM. 

Last April, J:COM picked Casa’s DOCSIS 3.1-capable C100G to support the rollout of broadband service that topped out at 320 Mbps in the downstream. 

J:COM’s deployment of Casa’s CCAP began earlier this year. J:COM serves over 5 million households. 

“Casa has proven its ability to deliver fully converged, commercial services over a CCAP,” Kazuhiko Masuda, J:COM’s senior corporate officer and GM of the MSO’s technology unit, said in a statement. “Now, we will be able to provide both video and data over one platform while reducing OPEX and network complexity.” 

Casa, which has been chasing Arris and Cisco Systems in the cable access network market, also counts customers such as Mediacom Communications, Wave Broadband and DNA, Finland’s largest operator. Time Warner Cable (now part of Charter Communications) has also been working with Casa. 

Nokia said it has wrapped up its acquisition of Gainspeed, a startup that has specialized in the development of a “virtual” Converged Cable Access Platform.

Nokia said Gainspeed’s product lineup will complement its current fiber access technologies for cable operators. Gainspeed will operate as part of Nokia’s Fixed Networks business group.

The deal gives Nokia a CCAP product that will enable it to compete in the next-gen cable access market against suppliers such as Arris, Cisco Systems, Casa Systems, Huawei, and Harmonic.

Founded in 2012 by Shlomo Rakib, a DOCSIS pioneer and co-founder of Terayon  Communication Systems (sold to Motorola in 2007), Sunnyvale, Calif.- based Gainspeed was founded in 2012. It raised about $55 million from investors that include NEA, Andreessen Horowitz, Shasta Ventures, Technicolor and Juniper Networks, which led Gainspeed's "B" round. 

Nokia, which announced its agreement to acquire Gainspeed on June 9, has not revealed financial terms of the deal. Nokia is scheduled to announce Q2 earnings on Thursday, Aug. 4.

High-level engineering execs from Comcast, Liberty Global and WideOpenWest all praised Nokia’s acquisition of Gainspeed when it was announced. Of that group, WOW said it was testing Gainspeed’s platform and “preparing for deployment.”

Gainspeed’s approach with a virtual CCAP distributes the MAC and PHY to the edges of the network while centralizing the control and management of the network in the data center.

Among its competitors, Arris last week noted that it is making “great progress” on remote PHY products that place the physical access layer of the DOCSIS CMTS into the fiber node and is also developing a “virtual DOCSIS core” that would appear to be directly competitive with the Gainspeed approach.

In a deal that will position it for cable’s shift to more efficient, next-gen access networks, Nokia has inked a deal to acquire Gainspeed, a startup that has been developing a “virtual” form of a converged cable access platform (CCAP) that will help pave the industry’s path toward an all-IP future.

Financial terms were not disclosed, but Gainspeed, a Sunnyvale, Calif.- based company founded in 2012, has raised about $55 million thanks to investors that include NEA, Andreessen Horowitz, Shasta Ventures, Technicolor and Juniper Networks, which led Gainspeed's "B" round and, until Nokia swooped in, was considered to be among the top potential suitors if Gainspeed sought an M&A exit. 

The deal is expected to close in Q3 2016, with Gainspeed becoming part of Nokia's Fixed Networks business group, which is led by unit president Federico Guillen. Gainspeed presently has about 70 employees, but it’s not yet known how many will be joining Nokia.

For Gainspeed, the acquisition should give its technology and products a much better shot at gaining significant adoption among larger operators, which tend to shy away from making major commitments to startups.  Gainspeed has not announced any trials or deployments with cable operators. However, top execs from Comcast, Liberty Global and WideOpenWest offered quotes in the announcement praising the deal (see below). Among that trio, WOW said it is "well down the path" with testing and "preparing for deployment" of Gainspeed's vCCAP. 

For Nokia, which closed its merger with Alcatel-Lucent earlier this year,  the addition of Gainspeed will complement its current fiber access products and arm it with a vCCAP as MSOs apply more weight to virtualized and more distributed hybrid fiber coax (HFC) network architectures amid the roll out the multi-gigabit DOCSIS 3.1 platform and their migration toward an all-IP service platform.

Nokia’s purchase of Gainspeed will also enable it to compete in a CCAP sector that includes companies such as Arris, Cisco Systems, Casa Systems, Harmonic, and Huawei, among others.

While today’s CCAPs are highly centralized and some vendors, such as Cisco, are pushing for remote PHY approaches, Gainspeed angle with a virtual CCAP will distribute the MAC and PHY to the edges of the network while centralizing the control and management of the network in the data center. These various approaches have formed the basis of a healthy debate in cable engineering circles. 

Gainspeed was founded by Shlomo Rakib, a DOCSIS pioneer and co-founder of Terayon  Communication Systems (sold to Motorola in 2007).

Former Harmonic exec Krishnan Padmanabhan joined Gainspeed as CEO on Sept. 2, 2014. He discussed his vision and near-term priorities for the company with Multichannel News soon after.

In that interview, Padmanabhan acknowledged that operators will not be eager to rip out their networks and start from scratch just to introduce virtual CCAP, offering that interest in the approach is “most likely a cap-and-grow strategy, meaning in a given headend or a city where they already have significant investments of edge QAMs and CCAPs in there.”

He was also confident that Gainspeed could resonate with bigger operators that don’t typically place big bets on products from startups because the technology it brings to the table can solve some important problems.

“If we were walking in selling some commodity and we’re the fourth supplier and the other three are big companies, I think it would be a very difficult task. The reality is, we’re not walking in offering a commodity. We’re walking in helping them solve a massive and pressing business problem with this IP traffic explosion.” 

Here are the statements from MSOs praising the deal:

“New and innovative services in broadband are important to us and to our customers.  We appreciate technology partners who make innovation one of their core values and look forward to Nokia and Gainspeed joining forces to bring new technologies and products to the industry.”

— Tony Werner, President, Technology and Product, Comcast Cable

“Gainspeed is one of the pioneers in the Remote PHY and Remote MAC-PHY architecture development. They have been committed to developing this solution for the cable industry, and I congratulate them on becoming part of Nokia. The combination of Gainspeed’s innovations and Nokia’s scale will be a positive contribution to the access solutions for our industry.”

— Balan Nair, Chief Technology Officer, Liberty Global 

“Gainspeed has been a leader in the broad industry shift toward Distributed Access Architectures to handle increased bandwidth demands and support of the network transformation to all IP. We are well down the path testing and preparing for deployment of Gainspeed’s Virtual CCAP solution and have been using Nokia access products for years. We are excited to see these technology leaders coming together, and view their solutions as a key strategic component in our network evolution and delivery of gigabit services.”

— Cash Hagen, Chief Technology Officer, WOW! Internet, Cable & Phone

Tech news is starting to roll in as AngaCom gets underway this week in Cologne, Germany. Here’s a snapshot:

-Cisco Systems said Altice has begun a field trial of DOCSIS 3.1 with SFR in France using the cBR-8, the vendor’s flagship converged cable access platform (CCAP). Cisco said Altice used the platform in a field trial that hit speeds of more than 3 Mbps per sub. Elsewhere on the D3.1 front, VOO, a Belgian cable operator, is rolling out the cBR-8 for residential and business services.

-Separately, Cisco announced that Teracom A/S, a provider of digital terrestrial transmitted radio and TV in Denmark, has launched a new digital headend that utilizes Cisco’s D9902 Digital Content Manager.

-Huawei has launched a 10-gig HFC access platform that supports DOCSIS 3.1 as well as 10G PON. Its HFC access platform consists of a OLT (Optical Line Terminal), 10G PON interface board, DOCSIS 3.1- based distributed CCAP, 10G PON ONT (Optical Network Terminal), and is tied together with a unified network management system, the company said. Huawei said its D-CCAP has been deployed with MSOs in 29 counties, including Denmark, New Zealand, Finland, France, Japan, Russia, and Brazil, with a footprint that covers 40 million households.

-Arris said German MSO NetCologne has tapped its Touchstone TG2492 Gateway to deliver gigabit speeds and wireless broadband coverage to subs in the Cologne, area. The TG2492 is a EuroDOCSIS gateway supports speeds of up to 1Gbps (32x8 DOCSIS 3.0 channel bonding), dual-band 802.11ac WiFi, and an embedded multimedia terminal adapter (for voice, up to two lines).

-Casa Systems said DNA Ltd., Finland’s largest MSO, has deployed the vendor’s C100G converged cable access platform for broadband service. DNA, Casa noted, recently tapped the platform to show D3.1-based downstream speeds of 3.055 Gbps. Casa Systems said the C100G has been deployed by more than 135 service providers, including Liberty Global, Jupiter Communications (J:COM) of Japan, Mediacom Communications and Time Warner Cable (now part of Charter Communications).

-Emcore has introduced the Medallion 8100 Series DOCSIS 3.1  L-EMLTM 1550nm externally-modulated CATV transmitter. The L-EMLTM device consists of a high power, low-noise, narrow linewidth laser combined with a proprietary highly linearised modulator in a monolithic assembly, the company said.

-MaxLinear said its MxL370x chipset has been picked by Hirschmann Multimedia BV for a new line of bonded MoCA (Multimedia over Coax Alliance) 2.0-based home networking products that will carry the “MOKA” brand. The new line will include a MOKA plug-in module for its in-home amps, a MOKA WiFi extender, and a USB-powered MOKA mini.

-VeEX will use this week’s show to debut a network sweep system for DOCSIS 3.1 deployments. Its redesigned CaLan 3010H+ CaTV sweep system is a headend unit that is compatible with Sunrise Telecom’s CM2800 and CM3800 testers, which now form part of the VeEX CaTV product portfolio, the vendor said.

-Rohde & Schwarz said it’s expanding its DOCSIS test and measurement portfolio with a D3.1- signal generator.

Get more #INTX2016 news.

A year after Cisco Systems used INTX in Chicago to trot out its next-gen cable access platform, the vendor announced ahead of this year’s confab in Boston that the cBR-8 is approaching 100 customers worldwide, with 30 already in deployment.

Cisco said cBR-8, a high-density  Converged Cable Access Platform (CCAP) product Cisco is now also referring to as its “Giga box,” is also employing DOCSIS 3.1, the industry’s new multi-gigabit CableLabs spec for hybrid fiber/coax networks.

The device, Cisco added, is deployed with operators in countries and regions that include the U.S., Europe,  Asia Pacific, and Latin America, and is now being used to deliver services to more than 7 million pay TV subs. Recent wins include Midco, which has kicked off 1-Gig trials in Fargo, N.D., with plans to expand trials to Sioux Falls later this year. Quickline AG, meanwhile, has completed a migraiotn to the cBR-8 and is using it to help 21 cable operators deliver multi-Gigabit services for 400,000 customers in Switzerland.

Per a blog from Todd McCrum, senior director, strategy and product management at Cisco’s Cable Access Business Unit, the cBR-8 hardware shipping today also supports “Evolved CCAP” functionality, which includes DOCSIS 3.0, voice and MPEG video, plus DOCSIS 3.1 downstream and upstream and remote PHY.

Cisco is battling for dominance with other suppliers in the cable access market. Among individual companies, Arris held 53% of total revenues in the category at the end of 2015, followed by Cisco (26%) and Casa Systems (15%), according to SNL Kagan. In March, Jeff Heynen, senior research analyst for SNL Kagan, said Cisco has been picking up momentum in recent quarters as the cBR-8 gets into the field.

Cisco Systems said industry vet Sean Welch has been appointed vice president of cable access, the unit that focused on cable modem termination systems as well as newer, high-density converged cable access platform (CCAP) products.

Welch succeeds Brett Wingo in that role. Wingo, the company said, has moved to Cisco’s Services Organization, led by VP of Services Joe Cozzolino.

Welch most recently was president and CEO at Kwicr, a cloud-based mobile network acceleration service. Before that he was SVP/GM of video infrastructure solutions for Arris, and also held VP/GM roles with Motorola, where he was focused on video and data solutions for service providers. 

Arris chairman and CEO Robert Stanzione declared that the supplier of video and broadband gear is off to a “good start” as revenues rose 33% in the first quarter, but paired that optimism with concerns about possible pauses on the horizon in the second half of the year amid ongoing consolidation of some of its largest customers.

In its first earnings call since closing its acquisition of U.K.-based set-top maker Pace plc in January, Arris pulled in Q1 revenues of $1.61 billion, up $399.5 million, or 33%, versus the year-ago period. Aided by the addition of Pace, revenues were also up 47% versus the previous quarter. In Q1, Arris has three customers that represented 10% of more of revenue – together, those customers brought in $840 million, or 52% of total sales. Q1 sales beat Wall Street's expectation of $1.58 billion.

“We're off to a good start in 2016 and I can say that we're increasingly confident that we'll meet the 2016 financial goals that we outlined in our,” Stanzione said, referring to full-year guidance of between $6.6 billion to $6.8 billion in sales, and non-GAAP earnings per share of $2.45 to $2.60.

Arris expects second quarter sales of between $1.67 billion to $1.72 billion, and GAAP earnings of $0.09 to $0.14.

As for caution about the second half of the year, consolidation activities, such as  Charter Communications’ pending deal for Time Warner Cable and Bright House Networks, “give me some degree of concern that there might be a pause,” Stanzione said. “I don't think there's any reduction in the end demand for our products, but there could be some shifts.”

However, telco spending, a recent trouble spot for Arris, is starting to recover, Stanzione said, noting that Frontier  Communications is expected to be aggressive with upgrades following its acquisition of some of Verizon’s wireline properties in California, Texas and Florida. He also expects to see “more uplift” as the year goes along from AT&T/DirecTV now that they are starting to ramp up new programs.

Among individual product areas, Arris’s flagship cable access platform, the E6000, hit record revenues as well as total downstream and upstream channels shipped and downstream software licenses, according to Bruce McClelland, president of Arris’s Network & Cloud and Global Services unit.

Arris, which is already involved in most of Comcast’s initial DOCSIS 3.1 deployments, also inked a commercial agreement with a tier 1 international operator to deploy the vendor’s D3.1 products later this year, but didn’t identify the MSO.

McClelland said Arris in Q1 made its software release for D3.1 generally available. Arris is also working on second-gen line cards for the E6000 that will supportdirect fiber, passive optical network interfaces, and support for the new distributed access architectures. “The first of these new cards will begin field trials in the third quarter,” he said.

Stanzione was also asked to weigh in again on the FCC’s proposed set-top rules, which could impact Arris, the world’s largest supplier of set-tops.

“In the worst case, if it were to be enacted exactly the way the FCC is proposing, that would open up a retail market, one which we're pretty excited about anyway,” Stanzione said, pointing to a new retail home networking products launched by Arris last month that uses a combo of WiFi and G.hn-based powerline technologies.  “We're building up our retail channel and I think even if it goes in a direction that we don't like, we would still be okay and I think the effect is couple years away.”

Update: Raymond James analyst Simon Leopold maintained his "Strong Buy" rating and a $33 price target on Arris following Q1 results. Arris shares were up 96 cents (4.15%) to $24.09 each in mid-day trading Thursday. 

Cable broadband infrastructure spending dipped by 3% in 2015, compared to 2014 levels, thanks in part to dropping DOCSIS downstream channel prices and record shipments of super-dense converged cable access platform (CCAP) products, SNL Kagan found.

Shipments of total DOCSIS downstream channels rose 41% during 2015, topping 6 million, as cable operators continued to build out capacity amid growing deployments of FTTP networks by Google Fiber, municipal providers and other ISPs, SNL Kagan said.

But revenues did not keep pace with shipments as the rise in software licenses helped to push down the average price per downstream channel. Despite that boost in channel shipments, revenues in the category dropped 3%, to $1.74 billion, SNL Kagan found.

Among vendors, Arris ended 2015 as the market leader, holding 53% of total revenue among suppliers of cable broadband infrastructure, aided by key customers such as Comcast and Time Warner Cable.

Update: Jeff Heynen, senior research analyst for SNL Kagan, said Cisco Systems followed with 26% share of the market by year-end, while Casa Systems collected 15%. He said Cisco has been picking up momentum in recent quarters as its new flagship CCAP, the  cBR-8, gets into the field, and the company continues to line up customers for the product.

All three will benefit from cable’s transition to DOCSIS 3.1, Heynen said, reiterating that he does expect spending to remain relatively strong as MSOs add capacity amid competition with other providers. 

“The imminent availability of DOCSIS 3.1 linecards and full-spectrum channels won't slow the continued purchase and deployment of current DOCSIS 3.0 channels as cable operators must continue to increase throughput to reduce the likelihood of churn among their broadband subscribers,” Heynen said, in a statement. 

Comcast, Arris’s largest customer, is among those being most aggressive with DOCSIS 3.1. Last week, Comcast announced an “advanced consumer trial” of a DOCSIS 3.1-powered offering in Atlanta that pairs a downstream that maxes out at 1 Gbps with a 35 Mbps upstream.

Comcast has also announced that it plans to offer residential and business-class gigabit broadband using DOCSIS 3.1 in Nashville in “early 2016,” and follow with launches in Chicago, Detroit and Miami in the second half of 2016. Arris announced last month that its flagship CCAP, the E6000, is supporting the rollout in four of the initial five DOCSIS 3.1 deployment markets identified by Comcast.

CableLabs and Cisco Systems have announced the creation of a new software project aimed at enabling virtualization on cable networks.

That new software project, labeled "OpenRPD" and originally developed by Cisco, is targeted at what's called the Remote PHY Device (RPD). The RPD, they explained, is a physical layer converter commonly located in an optical node of the cable network. The open source software will reside in the Remote PHY Device and will be available to cable operators and RPD vendors around the world, they said. 

CableLabs said president and CEO Phil McKinney detailed the initiative at his keynote at this week’s CableLabs Winter Conference in Orlando, Fla.  

The effort will build on the original work around the Converged Cable Access Platform (CCAP), a high-density architecture that combines the functions of the cable modem termination system and the edge QAM. The open source software will help to virtualize those functions as they are distributed toward the edge of the network.

“More and more of the telecommunications infrastructure is running on open source platforms,” said Ralph Brown, CTO, CableLabs, in a statement. “CableLabs has a history of contributing to and hosting open source projects. The OpenRPD project helps launch CableLabs increased focus on open source projects for the cable industry.”

“This is open source for cable access. Not only does it help move the industry toward the future architecture but it also enables a new developer community,” added Dave Ward, CTO of engineering and chief architect, at Cisco. “Open standards, open source and an open ecosystem community for developers is a key trajectory for networking. We see the Remote PHY architecture and RPD evolving to a more generalized and virtualized architecture that can be applied to all types of access networks.”

“Our collaborative industry effort is about helping cable networks scale,” said John Chapman, Cisco Fellow and CTO of the company’s Cable Access business. “Remote PHY, OpenRPD and DOCSIS 3.1 are playing a pivotal role in expanding the capacity of the HFC plant in a reliable, cost-effective and scalable way.” 

More light is being shed on the technical underpinnings of a residential 1-Gig offering that Mediacom Communications launched last year.

Casa Systems said the MSO is using its C100G converge cable access platform (CCAP) to power the network-side of the offering in its Columbia and Jefferson, Mo., markets.

Mediacom is also using a DOCSIS 3.0-powered modem from Hitron Technologies Americas to support the service, which teams a 1-Gig downstream with an upstream that maxes out at 50 Mbps for about $150 per months.

The deployment is another key win for Casa Systems, which is battling for CCAP share with market leaders, Arris and Cisco Systems, as well with suppliers such as Harmonic and Huawei Technologies.

“We are excited to bring our long experience providing commercial-grade gigabit services to our residential customers beginning with these communities in Mid-Missouri,” said JR Walden, Mediacom’s SVP of technology, in a statement. “Casa’s C100G was the right CMTS solution given our timing, facilities requirements, performance needs and desire to support the future evolution of our network and services.”

The Casa C100G is also capable of supporting DOCSIS 3.1, the emerging multi-gigabit platform for HFC networks. 

Casa Systems said Wave Broadband will use its C100G converge cable access platform to deliver gigabit speeds to residential and business customers in the Pacific Northwest.

Wave Broadband is rolling out the C100G, Casa’s CCAP that combines the functions of the cable modem termination system and the edge QAM. The C100G uses DOCSIS 3.0 today, but Casa has developed downstream and upstream modules that put the platform in position to support DOCSIS 3.1, an emerging multi-gigabit spec for HFC networks.

Wave has about 450,000 Internet, TV and phone customers in Northern California and parts of Oregon and Washington, and said it’s swapping out its legacy CMTSs for the gigabit plan, which will help the MSO deliver new bandwidth-intensive apps, including IP video.

Notably, Wave recently raised about $130 million in debt to help fund an aggressive buildout of its fiber optic communications network and aimed at bringing higher-speed connectivity to business customers.

"Driven by the incredible growth of streaming video, social media and other rich content, the gigabit era can't wait. To reinforce our investment in expanding gigabit services across our region, it was imperative we have the right infrastructure in place," said Harold Zeitz, president and COO at Wave, in a statement. "The C100G CCAP from Casa Systems is the solution that paves a seamless path to scale and supports next-gen technologies such as DOCSIS 3.1, wireless, PON architecture and virtualization that are poised to become competitive differentiators."

The win with Wave comes as Casa grapples for markets share against access network rivals such as Arris, Cisco Systems, Harmonic, and Huawei. 

AT&T GigaPower. CenturyLink 1-Gig. Google Fiber. Driven by the overwhelming growth of over-the-top (OTT) video, social media and other rich content, the Gigabit Internet era is here for U.S. consumers. They want it now, they’ll switch providers to get it, and they most definitely will not wait for it.

As the longtime residential broadband leaders, MSOs are finally nearing the finish line of a technology that will completely disrupt the competitive landscape and market narrative for Gigabit Internet: DOCSIS 3.1.

The new standard will also finally put the benefits and capabilities of the next generation of broadband delivery technology – the Converged Cable Access Platform (CCAP) – in full view and allow MSOs to compete for Gigabit Internet customers.

As with any product with CCAP’s potential, it comes with competing claims and confusion. So let’s set a few facts straight so the industry can move forward and unleash the potential of Gigabit Internet services and the ultra broadband customer experience.

Will the Real DOCSIS 3.1 CCAP Please Stand Up?

The transition to the DOCSIS 3.1 standard is both imminent and crucial to enabling MSOs with the capacity and speed they need to step into the ultra broadband generation. The challenge is parsing through the reality of CCAP equipment: is it DOCSIS 3.1-compliant now or will it “evolve” there over time? Will it be able to do full spectrum to reach the maximum of 10 Gbps downstream, or is that a future consideration and additional cost?

Advice to MSOs: Networks are built with equipment, not slides. With Gigabit Internet competition heating up, look for CCAP solutions that are fully DOCSIS 3.1 compliant today for both upstream and downstream. Also, understand the roadmap to know what additional investments will be required down the road to actually deliver DOCSIS 3.1 from a CCAP, including potentially needing to rip and replace switch cards, line cards or PHY modules. Underdeveloped technology and expensive card overhauls could add costs, time and complexity to Gigabit rollout plans.

Think Open, Intelligent and Software-Defined

There is also a view that CCAPs designed on open Advanced Telecom Computing Architecture (ATCA) platforms are limited in their ability to scale with DOCSIS 3.1 compared to proprietary hardware designs.

Advice to MSOs: Nobody likes vendor lock-in. ATCA platforms are open and designed to incorporate the latest trends in high speed interconnect technologies, next generation processors and carrier-grade reliability and manageability. More importantly, they are purpose-built as CCAPs based on their intelligent software, which makes them inherently more cloud-ready than proprietary hardware. In fact, there are ATCA-based CCAPs that support full spectrum DOCSIS 3.1 downstream today.

Be Wary of “Headend Hogs”

While the focus is on delivering Gigabit services, the original premise of the CCAP specification cannot be overlooked: a super-dense edge architecture that combines edge QAM and CMTS functionality in a device that saves headend space and power while converging IP services.

Advice to MSOs: While some CCAPs can be up to 75% deeper or weigh four times as much, the key metric to impact the bottom line is power consumption with some CCAPs costing up to $1,200 more per year per chassis to power. Given the size of CCAP deployments in the coming years to support Gigabit services, understanding the cost difference in power consumption and what that adds up to over time is critical. One major U.S. operator that deployed CCAPs in a major market found that they saved more than $5 million in energy costs in just the first year.

It’s the Gigabit World, not the Gigabit Wait

While telco and fiber competitors have seized headlines over the past year through limited fiber-to-the-home deployments in very select markets, MSOs stand on the precipice of Gigabit-enabling their entire HFC footprint and leading the ultra broadband industry for another decade. It will be a game changer and leading the charge will be CCAPs that support full spectrum downstream DOCSIS 3.1 today, effortlessly scale and are ready for cable’s software-defined future while minimizing their headend footprint and power consumption.

--Lisa Garvin is a senior product manager for Casa Systems, a provider of next generation cable edge technologies.

The debate swirling about emerging distributed CCAP (converged cable access platform) architectures is a good news/bad news story today.

The good news? There are multiple options that can be made to work.  The not so good news? It’s not yet clear which approach is “right” one, as some might work better than another depending on the cable operator and its individual needs.

But there is agreement on what’s driving the cable networking world toward more distributed forms of the CCAP, which packs in the functions of the cable modem termination system and the edge QAM to support all services. The general thought is that more distributed architectures will help operators support the surging bandwidth demand that’s being driven by IP video, gigabit broadband services, Ultra HD video, WiFi hotspot proliferation and the so-called Internet of Things.  Cable headends space is expected to become tighter and tighter as more capacity is needed if the industry sticks with integrated CCAP architectures.

While there’s agreement that distributed approaches will help to deal with this future headend space-crunch, there are a set of possible options that have emerged:

1. Remote MAC/PHY that puts the edge QAM in the node
2. Remote MAC/PHY that doesn’t place the eQAM in the node
3. Remote PHY, which places the PHY in the node and the MAC processing in the headend.

“All are good, none are perfect. All have some issues,” Tom Cloonan, chief technology officer—network solutions at Arris, said Thursday at a workshop titled: Distributed CCAP Architectures: Breaking Up Is Hard to Do.

Arris recently conducted a study that looked at the pros and cons of each approach, and picked 26 attributes that, Arris believed, are among the most important to the cable operator.  That was then divided into four broader areas: opera tonal cost management, operational east of use, infrastructure compatibility, and design simplicity (which factored in vendor time-to-market).  Arris’s engineers then applied scores  that weighed how well each architecture served each.

Arris then tabulated those results to see how it all shook out. “What’s best?” Cloonan posed. “I don’t have the answer…In the end, I think that all of them are workable solutions and technically feasible.”

Given that, he expects that different MSOs will go in different directions  and possibly bifurcate the supplier market.

Cisco Systems, meanwhile, is fairly fixated on which approach it favors  – remote PHY, which relocates  the physical layer components to the node.

John Chapman, Cisco fellow and CTO of the company’s cable business unit, discussed how resiliency can be applied to a remote PHY architecture, and said part of the debate is whether operators want to centralize the software running the system (with remote PHY) versus a more decentralized form with remote MAC/PHY that puts those software elements in the node.

“It’s fair to say that they both work,” Chapman said. “We can make anything work across all of the designs.”

Chapman noted that the remote PHY approach uses standardized interfaces to connect the headend to the remote PHY devices using pseudowires/tunneling protocols.

While that sort of approach might seem complex and “makes the brain hurt a little bit,” Chapman said remote PHY offers benefits that make it worth it, including higher reliability and the implementation of lower-cost digital optics, higher bit rates for DOCSIS 3.1 and lower plant maintenance costs.

Cisco, he said, is also thinking through how to make the architecture redundant so that there is no single point of failure. While nodes aren’t redundant elements, operators will have methods to apply that establish multiple backhauls to ensure that these nodes stay connected.  Chapman’s suggested approach is to retain an active backup versus building an on-demand backup connection that might take a few milliseconds to fire up.

“It’s a design choice, but it’s not something we mandate,” he said, noting that Cisco will provide the tools to support multiple options. “All remote PHY is, is a pseudowire management scheme.” 

There’s going to be a bunch of big discussions going on in The Big Easy this week as cable’s brightest minds converge for the industry’s annual tech-fest.

And once again the event will offer session and workshops spanning key industry initiatives and topics that are important now and will be soon, including DOCSIS 3.1, cybersecurity, the virtualization of the network (and CPE), and the opportunities and challenges of WiFi.

It’s impossible for one person to see and hear it all, so here we present what’s on our hot list for the week (all times Central Time). Also, to keep up with news and announcements from the show, please visit the Multichannel NewsSCTE Cable-Tec Expo micro-site. 

Cybersecurity

If you are in town before the show officially gets off the ground on Wednesday, you’ll want to catch what you can of Tuesday’s all-day pre-show conference symposium on cybersecurity (Room 294), a topic that has global importance that also extends well outside the cable industry.

Don’t Miss: The 9:15 a.m. keynote from John N. Stewart, senior vice president, chief security and trust officer for  Cisco Systems.

The Big Picture

For a look at how some of the industry’s top execs view the competitive landscape and a look on the horizon on how cable must continue to change and evolve to handle it, Wednesday’s General Session (New Orleans Theater) will fit the bill as execs discuss broadband network investment, energy management, the connected home and business services.

That session, starting at 8:30 a.m., will be led by moderator Pat Esser, president of Cox Communications, who will be joined by: Balan Nair, EVP and CTO, Liberty Global (and the show’s program committee chair); Nomi Bergman, president of Bright House Networks; Phil McKinney, president and CEO of CableLabs; and John Schanz, EVP and chief network officer of Comcast Cable.

Energy 2020 Update

Energy conservation is a front-burner initiative now, taking the form of the SCTE Energy 2020 project. Gear up for important update on the initiative’s progress during a 90-minute session that gets underway Thursday at 11 a.m in Room 283.

Workshops (200-level rooms)

DOCSIS 3.1

While fiber-to-the-premises represents the long-term future, the foreseeable path for multi-gigabit services is expected to travel the path of DOCSIS 3.1, an emerging platform that will be spotlighted throughout the week.

Don’s Miss:

DOCSIS 3.1 Readiness: To 1 Gig and Beyond

Tuesday, Oct. 13 at 2p.m.

Featuring: Jeffrey J. Howe of Arris (moderator), joined by Al Ruth, product line manager at JDSU (now Viavi); and Jorge Salinger, vice president, access architecture, Comcast.

DOCSIS 3.1 & IP Video Traffic Engineering: How to Squeeze 10 Pounds of Stuff Into a 5 Pound Bag

Tuesday, Oct. 13 at 3:15 p.m.

Featuring: Mike Latino, VP, service infrastructure and delivery, Cox (moderator); John Downey, consulting network engineer, Cisco; and Dr. Sean McCarthy, fellow, Arris.

DOCSIS  3.1 Upstream Optimizations: Going Up?    

Friday, Oct. 16 at 2 p.m.

Featuring: Dr. Tom Cloonan, CTO – network solutions, Arris (moderator);  Dr. Ayham Al-Banna, engineering fellow, CTO office – network solutions, Arris; and

Paul D. Brooks, chief architect, access networks and technology, Time Warner Cable.

Load Up on Downloading

While the FCC has not yet announced whether it would pursue new rules that would succeed the CableCard, the commission has eagerly sought potential downloadable alternatives to help spark a robust retail market for set-tops. This week offers a valuable opportunity to get up to speed on some of cable’s top pursuits in this area.

Don’t miss: Beefing up Security with DCAS       

Thursday, Oct. 15 at 10:45 a.m.

Featuring: Ralph Brown, CTO, CableLabs (moderator); Dr. James Alexander, senior director, video engineering, Charter Communications; and Edmond Shapiro, video solutions architect, Cisco.

Video’s Cloudy Present…Future

Have you heard of the “cloud”? Everything’s going there, including video.

Don’t Miss: Moving Set-Top Functions to the Cloud       

Thursday, Oct. 15 at 9:30 a.m.

Featuring: Marwan Fawaz, partner, Sarepta Advisors (moderator); Neill Kipp, distinguished engineer, Comcast VIPER; and Dr. Raj Nair, CTO, Mediaroom Reach, Ericsson.

Waxing Wireless

Can WiFi, cable’s go-to technology for wireless, coexist in harmony with emerging LTE-Unlicensed technologies? The LTE-U camp says yes, and we have the proof, while the cable camp says no, and we have the proof too. The truth falls somewhere in the middle.

Don’t miss: Potential Applications for LTE-U or LAA (License Assisted Access)     

Tuesday, Oct. 13 at 2 p.m.

Featuring:  Tim Burke, VP, strategic technology, Liberty Global (moderator); and Belal Hamzeh, director-network technology, CableLabs; and Sudhir B. Pattar, Ph.D. candidate, Rutgers University.

Distributed CCAP

While centralized, monolithic architectures have dominated cable’s broadband era, there’s a big movement now toward more efficient, distributed networks as MSOs go with high-density converged cable access platforms. But there’s a big debate on which approach is best.

Don’t Miss: Distributed CCAP Architectures: Breaking Up Is Hard to Do

Thursday, Oct. 15 at 9:30 a.m.

Featuring: Ken Wright, technology advisor, Wright Solutions (moderator); Dr. Tom Cloonan, CTO – network solutions, Arris; and John Chapman, fellow, and CTO of Cisco’s cable business unit.

IPv6

Now that the American Registry for Internet Numbers confirmed that the free pool for IPv4 addresses has run dry, there’s going to be a refocus on IPv6 and its virtually unlimited pool of addresses.

Don’t Miss: Core IP Peering and IPv6

Wednesday, Oct. 14 at 10:45 a.m.

Featuring Kevin McElearney, SVP, network engineering, Comcast (moderator); John Jason Brzozowski, fellow and chief architect, IPv6, Comcast; and Mark Goodwin, IP engineer, Cox.

Looking ahead to the DOCSIS 3.1 era, Midcontinent Communications said the Fargo-Morehead West area in North Dakota will be its first market to offer residential gigabit broadband services.

The announcement comes soon after Midco said it would deliver gigabit Internet speeds to its entire footprint by the end of 2017. Sioux Falls, Rapid City, Bismarck and Grand Forks have been identified as Midco markets that would be among the first to get gigabit service.

MidCo noted in July that it would shift to DOCSIS 3.1, an emerging multi-gigabit platform for HFC networks, using the cBR-8, a new Converged Cable Access Platform (CCAP) from Cisco Systems that combines the functions of the cable modem termination system and edge QAM. 

The MSO has not set a precise launch date for gigabit service in the Fargo metro area, noting that it must first deploy DOCSIS 3.1 modems, which will be hybrids that support both DOCSIS 3.0 and DOCSIS 3.1-based transport. As was shown at an interop at CableLabs earlier this week, CMTS, modem and chip vendors are making speedy progress with D3.1 as operators prepare to test the platform ahead of initial deployments that are expected to get underway in 2016.

In this week’s announcement, MidCo VP of technology Jon Pederson said in the release that the operator is “collaborating” with Cisco on the new modems (Cisco, by the way, is in the process of selling its CPE division, which includes set-tops and modems, to Technicolor).

Midco has been using fiber to deliver gig speeds, but said DOCSIS 3.1 will enable it to offer those speeds to a wider range of customers. The operator is going all-digital to free up spectrum for DOCSIS 3.1.

“We chose the Fargo metro area as the first area for Midco Gig because of the state-of-the-art technology we’ve been installing in the metro area during our Fargo build-out that started in 2014 and will continue through 2016,” says Pat McAdaragh, president and CEO of Midcontinent.

Midcontinent has more than 300,000 customers and serves parts of Minnesota, North Dakota, South Dakota and Wisconsin.

Softness in the cable broadband access market continued into the second quarter of 2015, as global revenues dropped 2% versus the previous quarter, IHS said in a new report that keeps track of spending for cable modem termination systems (CMTSs), edge QAMs, the Converged Cable Access Platform (CCAP), and coaxial media converters (CMCs).

IHS said revenues for that product group totaled $465 million in Q2 2015, while DOCSIS channel shipments in North America dropped 25% after rising 13% in the previous quarter. “[R]evenue was also down 19 percent due to a slowdown among a handful of larger operators,” IHS said

On the brighter side, global revenues in the second quarter actually rose 12% on a year-over-year basis. Additionally, spending on CCAPs, high-density, lower power consumption chassis that combine the functions of the CMTS and edge QAM, grew 34% in the first half of 2015 versus the prior year period (see chart). 

Operators spent heavily in the second half of 2014 and are now in the process of getting those products and that additional channel capacity deployed, Jeff Heynen, IHS’s research director for broadband access and pay TV, explained.

He noted that the effect of potential mergers (Charter Communications’ pending acquisitions of Time Warner Cable and Bright House Networks, for example) “did have some impact on purchasing, especially in North America.”

IHS also expects spending to pick up in the second half of 2015. Heynen added that the market is still waiting for the cBR-9, Cisco Systems’ new CCAP, and expects volume to pick up once that product becomes more widely deployed.

Heynen said slowness in the first half of the year will cause pent up demand and see shipments pick up in the fourth quarter as operators “go gangbusters on buying new cards and new licenses.”

He is also seeing some steady growth in the coax media converter market, which is picking up some steam in China and other emerging cable markets in the Asia Pacific region. That product category, now part of the overall Cable DOCSIS specifications, is opening up a total addressable market that will primarily benefit China-based suppliers such as Huawei and Sumavision. CMC product revenues represents 6% of the market in Q2 2015, up from less than 3% of the market a year ago, according to Heynen.

On the vendor front, Arris led the cable broadband access market in Q2 with 54% share of revenues, followed by Cisco (21%) and Casa Systems (15%), according to IHS.

Casa Systems staked its claim of the emerging DOCSIS 3.1 Wednesday with the introduction of a downstream module designed for the CableLabs-specified multi-gigabit platform.

Casa Systems said the D3.1-compliant module, called the DS8x192, is for its C100G (pictured) and C40G Converged Cable Access Platforms (CCAPs), which are high-density access network systems that combine the functions of the cable modem termination system and the edge QAM.  Last year, Casa debuted the US16x8, a module that supports DOCSIS 3.1 in the upstream direction.

The company said the first DOCSIS 3.1-facing software release on the new downstream module is expected to be ready for customer lab testing in the late third quarter of 2015.

The new downstream module appears as operators, including Comcast and Liberty Global, look to move aggressively with DOCSIS 3.1, a platform for HFC networks that will drive cable’s all-IP transition and shoot for capacities of up to 10 Gbps down and at least 1 Gbps in the upstream. Comcast expects to kick off field market trials of D3.1 by the fourth quarter of 2015

It also shows up as CableLabs announced this week that it has “opened the door” to official certification and qualification testing of DOCSIS 3.1-based modems and network equipment. Vendors must submit products to CableLabs by the week of October 5 to get into certification wave 116, the last one scheduled for 2015.  The results from wave 116 will be shared in mid-January 2016, according to CableLabs.

Casa plans to submit product for official DOCSIS 3.1 qualification testing at CableLabs this year, a company offiicial said via email. 

Casa Systems will face some stiff competition in the D3.1 arena, as it will be contending with companies such as Arris, Cisco Systems, Harmonic and Huawei. Casa has gained lots of ground during the DOCSIS 3.0 era. According to IHS/Infonetics, Arris nabbed a 53% share of CCAP/CMTS revenues in Q4 2014, followed by Casa (23.5%) and Cisco (20%).

Arris revenues and earnings took an expected hit in the second quarter as the supplier announced results Wednesday a few weeks after lowering guidance for the period amid “headwinds” caused by ongoing industry consolidation and the strengthening U.S. dollar.

Arris posted non-GAAP  earnings of 53 cents per share, down 24.3% year-over-year, on revenues of $1.26 billion, down 11.8% -- all in-line with analyst expectations.

Arris said three customers represented 10% or more of revenues in Q2. That trio represented $561 million, or 45% of total sales, in Q2. 

On the CPE side, sales and direct operating profit dropped by 18% and 33%, respectively.

Telco-based video CPE unit volumes dropped 9% versus the year-ago quarter, and cable units dropped 17% from last year’s record levels. Arris noted that it successfully qualified the XG1v3 (for Comcast) and initiated volume shipments.

Broadband CPE volumes were also down 10%, though 80% of those shipped are now WiFi enabled. Arris has also entered field trials with devices based on G.fast, a standard that aims to bring gigabit capabilities to DSL networks.

On the network, shipments of Arris’s flagship CCAP chassis, the E6000, hit a new record as more than 750 units were shipped, and downstream shipments exceeded Q2 levels. Arris said Suddenlink Communications tapped the E6000 for its 1-Gig residential rollout, which is initially being powered by DOCSIS 3.0.

Arris said development and interop testing for DOCSIS 3.1, the emerging multi-gigabit platform for HFC networks are moving forward in anticipation of initial field trials slated for Q4 2015.

Arris still expects to close its proposed $2.1 billion merger with U.K.-based Pace plc in Q4, noting that it has applied for regulatory approval in six jurisdictions, and has received approval in Germany and South Africa. Arris received a second request from the U.S. Department of Justice on June 29.

Looking ahead, Arris expects Q3 revenues of $1,210 million to $1,260 million, with adjusted net income per diluted share in the range of $0.52 to $0.58 and GAAP net income per diluted share in the range of $0.17 to $0.23. That's down from analyst expectations of $0.64 per share on revenues of $1.30 billion.

"Sales, margins, and Non-GAAP earnings were all up quarter over quarter, although not as much as we originally thought,” Arris chairman and CEO Bob Stanzione said in a statement summing up the period. “These results, as expected, are down compared with the second quarter of last year when we were launching an unprecedented number of new products.  As we have highlighted, we are encountering headwinds which we expect to continue through 2015, in particular those related to industry consolidations and the strong US dollar.”

Positioning itself for gigabit speeds, Midcontinent Communications is deploying the cBR-8, a new Converged Cable Access Platform (CCAP) from Cisco Systems that’s being made to support DOCSIS 3.1.

DOCSIS 3.1, a platform specified by CableLabs, is designed to support multi-gigabit speeds – up to 10 Gbps downstream and at least 1 Gbps in the upstream.

Cisco introduced the cBR-8 (pictured) in May at the INTX show in Chicago. As a multi-service CCAP, it will house the functions of the cable modem termination system and the edge QAM. Altice Group, which is acquiring Suddenlink Communications, has been testing the cBR-8, which had carried the “Battlestar” code-name.

Midcontinent has more than 300,000 customers and serves parts of Minnesota, North Dakota, South Dakota and Wisconsin. Last June, it doubled speeds for customers, and launched a new 200 Mbps (downstream) tier. The operator has set a goal to make gigabit speeds available to about 600,000 homes and 55,000 businesses by the end of 2017.

Midcontinent will use the CBR-8 for DOCSIS 3.0 initially, but is expected to use it for D3.1-based services as well. The initial wave of D3.1 modems will be hybrids that can utilize both DOCSIS  3.0 and 3.1-based spectrum.

“Cisco’s cBR-8 aligns with our strategy and vision to deliver Gigabit-speed Internet experiences that will change the quality of life and spur business innovation in the communities we serve,” Midcontinent VP of technology Jon Pederson said, in a statement. “With our customers’ bandwidth consumption doubling every 15 months, we need the right technology in place to support our network demands now and in the future. The unique DOCSIS and Remote PHY capabilities of the cBR-8 will help us meet our commitments for the Midcontinent Gigabit Initiative.”

“Advancing its cable access architecture with cBR-8’s advanced multi-Gigabit DOCSIS 3.0 and 3.1 technologies and converged video capabilities is a key step in their well-planned network evolution strategy,” added Brett Wingo, VP and GM of Cisco’s Service Provider Infrastructure Group. 

Representing the next step in the evolution of DOCSIS-powered cable broadband networks, CableLabs recently released a new family of specs that cover a range of “distributed” architectures for the Converged Cable Access Platform (CCAP), a high-density system that combines the functions of the cable modem termination system and the edge QAM and will play a key role in the industry’s all-IP transition.

The new distributed architectures, which expand on today’s more centralized deployments,  will provide “significant scale advantages and flexible deployment options supporting…both DOCSIS 3.0 and DOCSIS 3.1 networks,” Karthik Sundaresan, a principal architect at CableLabs, explained in this blog post about the new specifications, which aim to facilitate multi-vendor interoperability.

The distributed approach, Sundaresan wrote, fits with the software-defined networking (SDN) and networks functions virtualization (NFV) initiatives operators are pursuing, and will run parallel to a wide range of wireless infrastructure architectures.

He noted that distributed DOCSIS deployments are already underway in some markets that use  C-DOCSIS, a modified approach that was originally developed for China’s cable market that has since been formally integrated with CableLabs’s broader DOCSIS initiatives.

CableLabs, Sundaresan explained, is specifying several different Distributed CCAP Architectures (including Remote PHY and Remote MAC-PHY) and will release the set of technical reports and specifications throughout this summer.

The specs will apply to DOCSIS and CCAP vendors such as Arris, Cisco Systems, Casa Systems, Harmonic and Huawei, as well as Gainspeed, a startup that is developing a “virtual” CCAP.

CableLabs issued the Remote PHY family of specifications last month (the technology is covered via six specs and one technical report describing the overall architecture). Labeled as “MHAv2,’ they represent an evolution of the original Modular Headend Architecture specifications.

Remote PHY  paves the way for an integrated CCAP to be separated into two components -- the CCAP Core and the Remote PHY Device (RPD) – along with an interface that weaves them together using “pseudowires.”  

A common location for an RPD, which contains elements such as the downstream QAM and OFDM modulators, upstream QAM and OFDM demodulators, is the optical node, located at the junction of the fiber and coax plants, Sundaresan wrote.

Sundaresan said vendors have begun architecting ASIC designs, device platforms and software to implement the RPD and CCAP-Core devices. The specs for the OSS that will manage the devices are under development and will be released this summer.

The first quarter represented a mixed bag for cable broadband access network equipment suppliers as DOCSIS channel shipments climbed but overall revenues in the category dipped due to aggressive pricing and a surge in software licenses, according to a new report from IHS that tracks shipments of cable modem termination system (CMTS), converged cable access platform (CCAP) and edge QAM products.

Thanks to ongoing upgrades, DOCSIS channel shipments rose to 1.8 million in Q1, up 14% from the previous quarter and up 48% from the year-ago quarter, but revenues tied to combined shipments of CCAP, CMTS, CMC and edge QAM equipment fell 7% sequentially in the first quarter, to $474 million.

"The cable broadband market got off to a mixed start in the first quarter,” Jeff Heynen, research director for broadband access and pay TV at IHS, said in a statement. “Despite the first quarter typically being a slow one, DOCSIS channels increased yet again. But revenue was down due to a combination of aggressive pricing and a higher proportion of software licenses.”

While the scuttled Comcast-Time Warner Cable merger was expected to dampen the cable access market in North America, “the overall cable broadband market remained healthy, setting the stage for a strong 2015,” IHS said in its report.

Among vendors, Arris dominated the market in the first quarter, due in part to the early availability of the E6000, Arris’s integrated CCAP, IHS said. Arris rival Cisco Systems introduced its integrated CCAP, the cBR-8, in May during the INTX show in Chicago, noting that shipments were underway with MSOs such as Comcast and Altice Group.

Update: Heynen said Arris represented 51% of revenue share in the product category (CMTS, CCAP, edge QAM and CMC equipment) in the first quarter,  followed by Casa Systems (18.8%) and Cisco Systems (18.7%). 

Suddenlink Communications has begun to roll out the E6000, Arris’s flagship, high-density converged cable access platform (CCAP) that supports DOCSIS 3.0 today, and will be  upgradable to DOCSIS 3.1, cable’s emerging multi-gigabit IP platform.

With the E6000 (pictured), Suddenlink can provide customers with high-speed data services of 1Gbps and beyond, Arris noted.

Suddenlink’s deployment of the E6000 comes about nine months after the cable operator  announced “Operation Gigaspeed,” an initiative that will position Suddenlink to deliver 1-Gig speeds. At the time, Suddenlink said it will raise its top high-speed Internet speeds to 1 Gbps in 90% of its footprint by 2017.

"We're committed to providing consumers with the connected experiences they want, and as a result, our customer base is growing rapidly," Ivan Lamoureux, Suddenlink’s vice president of network engineering, said in a statement. "The E6000 CER is a key part of this commitment and our technology infrastructure."

The E6000’s “density saves valuable space and power while delivering remarkable downstream and upstream capacity,” Bruce McClelland, president of network and cloud and global services at Arris, added. “Most importantly, it protects customer investments, offering a clear path to the future transition to DOCSIS 3.1 and the ability to support data services of 1Gbps and beyond.”

Arris posted lower first quarter numbers as the company continued to face uncertainty and “headwinds” amid M&A activity involving some of its biggest customers.

Of note, Comcast and Time Warner Cable broke up their proposed merger, while AT&T and DirecTV are still in the process of tying the knot.

“As we indicated on our previous earnings call, we've seen overall spending levels down from prior periods primarily due to the distractions and uncertainties associated with industry dynamics,” Bob Stanzione, Arris chairman, president and CEO, said on Wednesday's earnings call. "However, we feel great about our position in the market. We're going through a period of change that is having what we feel is a temporary effect on our business." 

Stanzione said it will “take us a while” to determine how the Comcast/TWC news will affect Arris later in the year, but believes Arris is “very well positioned in both Comcast and Time Warner with their next generation projects, and I think that we'll see business begin to improve as the year goes on.”

Arris posted Q1 revenues of $1.21 billion, down $9.8 million (1%) from the year-ago quarter, and down $48.2 million (4%) from the previous period. Adjusted net income was 44 cents per diluted share, versus 47 cents in the year-ago quarter. Those results were in-line, as analysts were expecting revenues of $1.22 billion, and a profit of 44 cents per share. 

Product Update

Arris saw decreased demand from some customers deploying stand-alone HD digital set-tops coupled with progress made with more capable video gateways with customers such as Comcast, Verizon Communications and TWC, Larry Robinson, president, customer premises equipment at Arris, said. Arris said it surpassed 4 million video gateway unit shipments in Q1.

On the network end, quarter-over-quarter CMTS revenues dropped 10% and were down moderately from record level shipments in the previous quarter, Bruce McClelland, president of network & cloud and global services, said.

Sales of E6000, Arris’s new flagship converged cable access platform (CCAP) that will factor heavily into the vendor’s DOCSIS 3.1 strategy, rose 41% year-on-year, but were down slightly from Q4 2014.

McClelland said Arris successfully completed several DOCSIS 3.1 interop events at CableLabs and expects lab and field trails to start later this year.

M&A Action

Arris also addressed two recent acquisition deals – the $135 million purchase of ActiveVideo Networks (through a joint venture with Charter Communications), and the proposed $2.1 billion play for U.K.-based Pace plc.

Stanzione said the ActiveVideo deal is expected to close “in the next few days,” and reiterated that the Pace merger, expected to close in the second half of the year, will increase Arris’s scale, international presence and give it a larger entry into the satellite video segment. The combo of Arris and Pace into the “New Arris,” to be incorporated in the U.K., is poised to have revenues of about $8 billion.

Arris was again asked about the antitrust risk posed by the Pace deal, which will combine the world’s top two set-top box makers.

“We're fairly confident based on the advance we've gotten from the experts in the area that will be able to clear that hurdle,” Stanzione said.

Stanzione also downplayed fears that the set-top will fade from existence.

“I would ask the question, what's going to replace them?  I think the answer to that question is… that there is a transition going on from video set-top boxes to advanced gateways,” Stanzione said. “We don't think it [the set-top box] goes away.”

Looking ahead, Arris expects Q2 revenues of $1.27 billion to $1.31 billion, and non-GAAP earnings of 53 cents to 58 cents per share.

Add Altice Group to the group of MSOs that are putting their weight behind DOCSIS 3.1, the emerging CableLabs-specified platform that deliver multi-gigabit capabilities to HFC networks.

The operator said it will deploy a Converged Cable Access Platform (CCAP) from Cisco Systems across its multi-country footprint, starting with Numericable in France, to serve as the foundation for its eventual move to DOCSIS 3.1.

D3.1, the successor to DOCSIS 3.0, is a more bandwidth-efficient platform that is being made to support downstream capacities of up to 10 Gbps and at least 1 Gbps in the upstream.

"This step is part of our long-term investment strategy,” Max Blumberg, CTO of Altice Group, said in a statement. “We are building the next generation of fixed mobile converged networks. With a combination of Cisco's Evolved CCAP, DOCSIS 3.1 and migration to NFV/SDN, Altice will continue providing the best customer experience, based on the highest bandwidth and cutting edge technology." 

"Cisco is working closely with Altice to provide them with a CCAP platform offering D3.0 plus D3.1 designed for long-term investment protection and full spectrum video, to simplify the evolution of their cable access network,” added Brett Wingo, VP and GM of Cisco’s Cable Access business Unit.”

Cisco is expected to support D3.1 in its next-gen CCAP, the cBR-8, a product also known by its “Battlestar” code-name.

Reaching a significant milestone in the deployment of next-gen cable access technologies, Casa Systems confirmed Monday that Time Warner Cable is delivering IP-based data and voice services and QAM-based video simultaneously in New York using the vendor’s integrated Converged Cable Access Platform (CCAP).

The achievement is significant because it’s the first known deployment in North America of a CCAP that is delivering both IP and QAM services via the same platform. The CCAP, a high-density, energy-saving platform, puts the functions of the edge QAM and the cable modem termination system under the same roof. While early CCAP-facing implementations have served as either super CMTSs or edge QAMs, the TWC/Casa deployment in New York is mixing both IP- and MPEG/QAM traffic on the same platform at the same time. 

According to Casa, TWC has “migrated hundreds of thousands of video subs” to the vendor’s C100G integrated CCAP (pictured), a product introduced in mid-2013.

Word of the achievement first emerged last month at a Light Reading event in Denver. “We still are the first to go out with CCAP with being able to provision MPEG-2 video on CCAP,” Mike Hayashi, the retiring executive vice president, architecture, development and engineering at TWC, said during a panel moderated by independent analyst and Multichannel News contributor Leslie Ellis. Hayashi also talked up the operational advantages of CCAP when it comes to assigning capacity to service groups and service types.

While Arris was the top provider of CCAP/CMTS gear in the fourth quarter of 2014, with a 53% share of revenues, Casa held about 23.5%, enough to move ahead of Cisco Systems’s 20%, according to Infonetics Research.

Driven by broadband speed upgrades, shipments of DOCSIS channels rocketed to a record 4.8 million worldwide in 2014, a year-over-year increase of 114%, according to Infonetics Research’s latest report on the cable access tech market.

Cable access gear – a category that includes cable modem termination systems (CMTSs), converged cable access platforms (CCAPs), edge QAMs and coaxial media converters – grew 27%, to $1.7 billion, in 2014. Fourth quarter revenues totaled $493 million, an increase of 11%.

Shipments in North America were particularly strong, rising 139% in 2014, with revenues jumping 35%.

But it wasn’t a rosy year for all makers of DOCSIS-powered networking gear. While Arris dominated the market with 48% of global revenue in the sector and Casa Systems turned in a record year, with a revenue increase of 195%, Cisco Systems “had one of its most disappointing years for CCAP/CMTS sales,” Infonetics said.

Infonetics noted that 2014 will be remembered as a “transitional year” as MSOs started to switch from traditional CMTSs to provisional deployments of CCAPs, which are higher-density, power-saving platforms that will combine the functions of the CMTS and edge QAM and pave a path toward an all-IP infrastructure.

From 2013 to 2014, CCAP revenue increased 997% percent, to $1.4 billion, while CMTS revenue dipped 84%, to $155 million, according to Infonetics.

"The continued growth of DOCSIS channel shipments is a strong sign of multiple system operators' (MSOs') ongoing investment to ramp DOCSIS bandwidth and services like IP video by splitting optical nodes and reducing service group sizes via CCAP," said Jeff Heynen, principal analyst for broadband access and pay TV at Infonetics Research, in a statement, noting that channels expansion will continue as operators prepare for DOCSIS 3.1 and remote-PHY platforms, though most growth will come from CCAP products.

But there are bumps in the road, with the pending merger between Comcast and Time Warner Cable threatening to exacerbate usual first quarter slowness. With that in mind, Infonetics expects DOCSIS and edge QAM channel shipments to drop 7% in Q1. 

While there’s been some controversy surrounding what’s the right strategy for NBN Co due to a bit of an historical bias toward FTTP, hybrid fiber/coax (HFC) will be a “cornerstone” technology as Australia’s government-sponsored agency for next-gen broadband pushes ahead, Bruce McClelland, president of Network & Cloud and Global Services, said the day after vendor announced its chief role in the project.

Fiber-to-the-premises, DSL, satellite and fixed wireless will also play a part in NBN Co’s plan, which will ultimately create an open access network for  a number of “retail service providers” that will ultimately ride on top of that common mixed-technology network. It’s expected that the upgraded HFC network will cover about 3.4 million premises, nearly half of the 8 million envisioned by the NBN project.

While Telstra’s HFC networks are in decent shape, Optus’s was relatively under-invested, McClelland said, noting that the broadband technology underpinning those networks spans everything from DOCSIS 1.0 to DOCSIS 3.0.

While the plan is to move to a Converged Cable Access Platform, the HFC-facing tech roadmap also includes a possible future migration to DOCSIS 3.1.

As for timing, McClelland said NBN would like to reach commercial trials with the new technology platform toward the end of 2015, with widescale commercial deployments underway by the first part of 2016.

Arris’s deal with NBN doesn’t include modems and other consumer premises equipment, as NBN will specify the minimum requirements but leave distribution of that equipment to its retail service partners. Arris, though, is “highly motivated to participate in that piece of the solution as well,” McClelland said.

Arris and NBN didn’t reveal financial terms, though one report placed the value at about $400 million. In a research note issued Monday (February 23), Simon Leopold, analyst with Raymond James, hesitated to put precise value on the deal, but said it could be “worth double digit millions.”

Although Arris sees international markets as a growth driver, “recent dollar strength might present a headwind for this opportunity,” Leopold added.

Gainspeed, a startup that’s developing a “virtual” implementation of a Converged Cable Access Platform (CCAP), has hired industry vet Jim Marino to the post of vice president of worldwide sales.

Marino most recently served as SVP of global sales and service for Concurrent Computer Corp.’s Video Solutions Business. Before that he was VP of global sales for CommScope’s Advanced Broadband Division, and is also late of Harmonic, ADC, Optinel Systems and Scientific Atlanta (now part of Cisco Systems).

Gainspeed said Marino will drive the Sunnyvale, Calif.-based company’s go-to-market efforts and will work closely with Mark Stalica, the vendor’s VP of sales.

Gainspeed, a company founded by Shlomo Rakib, a DOCSIS pioneer and co-founder of Terayon has not revealed its product roadmap, but the company is focused on a virtualized CCAP that will distribute the MAC and PHY out on the network, and compete in the market with vendors such as Arris, Cisco, Casa Systems, and Harmonic.

Former Harmonic exec Krishnan Padmanabhan joined Gainspeed as CEO on Sept. 2, 2014. He discussed his vision and near-term priorities for the company with Multichannel News soon after.

Juniper Networks, one of Gainspeed’s major investors, CommScope, Netgear and JDSU struck up an interoperability partnership almost a year ago. 

Arris remained the top dog from a revenue perspective in a global cable access market that raked in $445 million in the third quarter of 2014, up 8% versus the previous quarter, according to a new report from Infonetics Research.

That figure factors in worldwide revenues for cable modem termination system (CMTS), converged cable access platform (CCAP), edge QAM and coax media converter (CMC) equipment. CCAP is a next-gen high-density platform that combines the functions of the CMTS and the edge QAM, while the CMC is a stripped down form of a CMTS that is becoming popular in China and other markets that are focusing on more distributed architectures. The CMC was historically tied to C-DOCSIS, an architecture that has been integrated with the CableLabs DOCSIS specifications. 

Of that combined equipment market, Arris pulled down 50% of the revenues in the third quarter of 2014, followed by Cisco Systems (30%), Casa Systems (18%), and Harmonic (3.5%), according to Infonetics.

Cisco, once the market’s leader, could start to catch up when it releases the cBR-8, its next-gen, integrated CCAP product, for general availability. 

“Everyone is waiting for the cBR-8,” Jeff Heynen, principal analyst for broadband access and pay TV at Infonetics, said.  “Once it’s ready, the market is going to go gangbusters.”

Not that the market’s doing shabbily now. Although shipments of total upstream and downstream DOCSIS channels, at 1.2 million, were down some on a sequential basis in the third quarter of 2014, they were up 95% versus what was shipped globally a year ago, according to Heynen.

Additionally, CCAP revenues rose 7% in the third quarter, to $360 million, versus the previous quarter. Heynen said the shift to CCAP is currently most acute in North America.

Infonetics expects the number of DOCSIS channels shipped globally to nearly triple from 2013 to 2015. According to the research firm’s current projections, about 4.5 million DOCSIS channels will ship this year, and surge past 6 million in 2015.

The cable industry will have a front row seat as The Linux Foundation moves forward on the Open Platform for NFV (OPNFV) project, an initiative involving a large group of carrier and vendors that aims to build a common, interoperable platform that can accelerate the network functions virtualization marketplace.

CableLabs is a founding member of OPNFV and Chris Donley, CableLabs’ director of advanced networks and applications, will serve on the OPNFV board, according to this blog post by CableLabs principal architect Don Clarke.

Virtualization is becoming a big focus for telecom and, by extension, for the cable industry, which is mulling the best way forward on a virtual form of the converged cable access platform (CCAP), a high-density, energy-saving access architecture that packs in the functions of the cable modem termination system and the edge QAM.

Donley told Multichannel News earlier this year that CableLabs had begun to investigate how a virtual CCAP would look like, noting that such work was still in the “relatively early stages,” and stemmed from CableLabs’ study of the advantages promised by software-defined networking and NFV, which creates a path to putting into software and off-the-shelf servers many functions that have historically been packed into purpose-built hardware.

“OPNFV will create a reference platform where performance and interoperability of open source NFV solutions will be validated. As one of those involved in the early discussions that led to the creation of OPNFV, I am extremely pleased that we have been able to help bring into existence this new forum,” Clarke wrote, adding that CableLabs hosted the inception meeting for OPNFV at the organization’s Sunnyvale location  in June. “For the first time network designers will not be limited by the constraints of fixed hardware to design their networks.”

He added that an open source approach will allow for specs and implementation to “occur simultaneously,” speed up the overall process.

Clarke, who joined CableLabs in May, also shed some light on CableLabs' progress on the vCCAP front, noting that the R&D house has developed a CMTS plug-in for OpenDaylight, an open source SDN controller, that was used by several vendors to show off SDN/NFV implementations at last week’s SCTE Cable-Tec Expo in Denver. Clarke said the CMTS plug-in has been incorporated into the OpenDaylight “Helium” release.

The Linux Foundation on Tuesday announced the following members of OPNFV:

Platinum Members: AT&T, Brocade, China Mobile, Cisco, Dell, Ericsson, HP, Huawei, IBM, Intel, Juniper Networks, NEC, Nokia Networks, NTT DOCOMO, Red Hat, Telecom Italia and Vodafone.

Sliver-Level Founding Members: 6WIND, Alcatel-Lucent, ARM, Broadcom, CableLabs, Cavium, CenturyLink, Ciena, Citrix, ClearPath Networks, ConteXtream, Coriant, Cyan, Dorado Software, Ixia, Metaswitch Networks, Mirantis, Orange, Sandvine, Sprint and Wind River.

According to The Linux Foundation, OPNFV “will establish a carrier-grade, integrated, open source reference platform that industry peers will build together to advance the evolution of NFV and ensure consistency, performance and interoperability among multiple open source components.”

Noting that multiple open source NFV “building blocks” existing already, OPNFV will seek to coordinate continuous integration and testing while filling development gaps.

The initial scope of OPNFV will be on building NFV infrastructure (NFVI) and Virtualized Infrastructure Management (VIM) leveraging existing open source components where possible. OPNFV will also license new components under the Apache License Version 2.0 and will work within the licensing requirements of upstream projects in order to contribute code back to these projects.

Board officers for OPNFV include Prodip Sen, board chair (HP); Margaret Chiosi, president (AT&T); Wenjing Chu, secretary (Dell); and Hui Deng, treasurer (China Mobile).

If good things indeed come in small packages, Casa Systems (booth 1739) is testing out that axiom at this week’s Cable-Tec Expo with the launch of the C40G, a compact version of its integrated converged cable access platform (CCAP) that packs in support for MPEG video, IP video and DOCSIS over a single port.

Casa, which has been gaining ground on cable access market leaders Arris and Cisco Systems, claims that the C40G supports the same functionality of its larger integrated CCAP cousin, the C100G.

According to Casa, the C40G platform utilizes all of the existing C100G CCAP modules including: the downstream module (DS8X96); switching module (SMM8X10G); and upstream modules (US16X4 & 16X8)

“With the announcement of the C40G, Casa Systems is the first vendor to provide an extremely cost effective and highly economical CCAP platform for those operators who have smaller headends,” said Jeff Heynen, principal analyst of broadband access and pay TV for Infonetics Research, in a statement.