Terayon Adds DOCSIS Modem to Roster

Terayon Communications Systems Inc. says its newly
certified, standards-based cable modem will complement its widely deployed proprietary
products, rather than compete with them.

Terayon, which claims a 15 percent worldwide market share
for cable modems based on its synchronous code division multiple access technology, made
it through Cable Television Laboratories Inc.'s latest interoperability testing on
the first pass for its TeraJet modem based on Data Over Cable Service Interface
Specification (DOCSIS) version 1.0.

While the company already has deployed S-CDMA product with
a number of major North American and overseas operators, including Cablevision Systems,
Rogers Cablesystems, Shaw Communications and United Pan-Europe Communications, Terayon
believes DOCSIS 1.0 interoperability certification opens doors to new customers.

The company expects to submit a DOCSIS 1.0-compliant
cable-modem termination system for CableLabs qualification later this year.

Terayon's early strategy was to focus on developing
cable-modem systems that comply with later DOCSIS generations such as 1.1 (encompassing
support for telephony) and 1.2 (encompassing next-generation physical layer technology
that enables operators to deliver higher-speed two way service and boost the data capacity
of their networks). Terayon co-authored the proposed 1.2 specification, which will be
backward compatible with earlier DOCSIS generations, for CableLabs.

But the company had to shift gears as it saw competitors
moving aggressively into the market for DOCSIS 1.0 equipment. Operators view DOCSIS
compliance as a key element in creating a consumer retail market for cable modems by
ensuring different brands of modem work with different brands of cable headends.

Hamburger said winning DOCSIS 1.0 certification puts
Terayon on a stronger footing to prepare for eventual testing of 1.1 and 1.2 products.

"Since we are very interested in making sure we have a
DOCSIS 1.1 certified system at least at the same time as others, and a system that is 1.2
capable, the earlier we can inject ourselves into the DOCSIS process the better,"
Hamburger said.

The TeraJet was developed through an original-equipment
manufacturer agreement with Taiwanese manufacturer TurboNet Communications, which also has
an OEM deal to build the DOCSIS-certified modem for Toshiba.