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.

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%). 

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.