Harmonic Adds $55 Million CableOS Deal with Unnamed Euro Operator

Harmonic’s virtualized cable access sales are starting to come to fruition, with the San Jose, Calif.-based technology company announcing a five-year, $55 million contract with a unnamed European operator for its CableOS software product.

The announcement, made during Harmonic’s second-quarter earnings call Monday, comes just a few weeks after Comcast finally game through with an expected big CableOS order—a five-year contract valued at $175 million, with $50 million hitting the software makers books this year.

In total, CableOS is now commercially deployed by 16 cable operators, CEO Patrick Harshman told investors, “with 780,000 connected cable modems at the end of the second quarter, which is up 16% sequentially from the number we shared with you at the end of the first quarter.”

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

CommScope’s newly acquired Arris unit leads the cable access network technology business but Harmonic is the leading insurgent, selling a software the virtualizes Converged Cable Access Platform functions traditionally performed by expensive proprietary hardware, such as cable modem termination system (CMTS).

“Today, we've made 35 unique patent filings,” Harshman declared. "Big picture is increasingly clear that the cable access market is beginning to make a major pivot towards these virtualized CMTS distributed access architectures. It's also clear that this is not just a U.S. phenomenon. We're seeing the trend beginning to unfold across all regions, driven by those operators who are most aggressive about strengthening their competitive position.

Harmonic CEO Patrick Harshman

Harmonic CEO Patrick Harshman

“Our pioneering innovations and strategic customer engagements have put us in a unique position to take advantage of this global wave,” Harshman added. “And let me be clear, Harmonic is determined to take advantage of this opportunity not only by leading technologically, but to be the global market share leader. We're doing this by leveraging our position and as the first cloud native CMTS supplier, our associated with unique solution for new distributed access architectures, our strong intellectual property position and foundational wins within our several of the world's largest and most influential cable operators.”

While Harmonic planted its virtualized flag over the cable access business, it reported GAAP revenue of $84.9 million for the second quarter, down 14.4% year over year.

Continued infiltration of CableOS will certainly help matters going forward. The company’s software (SaaS) revenue came in at $30.4 million for Q2, representing $35.9% of total revenue. SaaS was just 30.9% of total revenue a year ago. 

Daniel Frankel

Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!