IPTV Mergers Close
February 2006
The mergers between Cisco and Scientific Atlanta, Motorola and Kreatel, Ericsson and Marconi, and Calix and Optical Solutions closed this month.
The Motorola/Kreatel merger had the most effect and moved Motorola into the number one position in the IP TV set-top box market as measured in our latest IPTV Market Leader report. Kreatel’s strong position in Europe complements Motorola’s strong position in North America.
The Cisco/Scientific Atlanta merger combines Cisco’s strength in the aggregation and backbone networks with Scientific Atlanta’s strength in headends and set-top boxes. While Scientific Atlanta helps Cisco in the cable market today, it should improve its position in the IP TV market as well by giving it the ability to address a broader set of IP TV network issues.
The Ericsson acquisition brings some benefits in the IP TV market, but does not significantly improve Ericsson’s position in this market. It does gain significant optical networking capability from the merger.
The Calix/Optical Solutions merger improves Calix’s position in the U.S. small telco market.
As we have said before, we believe that this is the start. Read about Tandberg and Skystream and the Nortel/Huawei joint venture below. We believe that these M&A activities will continue through 2006 and 2007.
{Note: analyst comments are italicized}
For more information, see our IPTV Market Leaders Report
Source: MRG, Inc., February 2006 IPTV Bulletin
Who are the IPTV Leaders?
Feburary 2006
MRG’s new IPTV Market Leader report, now available, gives the position of about 60 different companies in four different regional markets and globally. These companies are grouped into six different product categories. MRG has added a new ranking system to thisreport for each of the 30 market sectors. The number one company in each global market and each product category are given in the table below:
| IPTV Product Category |
Global Leader |
| Access |
NEC |
| Video Headend |
Tut |
| Video-on-Demand |
entone |
| Set-top Box |
Motorola |
| Middleware |
Thomson |
Content Protection/
Digital Rights Management |
Viaccess |
NEC is number one in Access Systems due to its inclusion in the PCCW deployment in Hong Kong. ECI is number two globally and number one in Europe.
Tut remains the number one company globally and in North America in IPTV Video Headends due to its strong position in the U.S. independent telco market.
In Video-in-Demand systems, entone is the number one company globally and in Asia due to its deployment at PCCW. Alcatel is number two globally and number one in Europe.
Motorola is number one in Set-top Boxes globally as well as in North America and Europe due to its recent acquisition of Kreatel. Yuxing is number two globally and number one in Europe due to its inclusion PCCW’s network.
Thomson/Thales is number one globally in IPTV Middleware and in Europe, due to its inclusion in France Telecom’s network. Orca is number two globally and number one in Asia.
In IPTV Content Protection systems, Viaccess is number one globally and in Europe, due to its inclusion in France Telecom’s network. Widevine is number two globally and number one in Asia and North America.
This report is based on a database of 370 service providers globally that have some level of IP TV activity underway. More than 200 of these companies are small independent telcos in the U.S.
For more information, see our IPTV Market Leaders Report
Source: MRG, Inc., February 2006 IPTV Bulletin
TANDBERG TV to Acquire Skystream?
February 2006
Tandberg TV has signed an agreement to acquire Skystream. Both companies produce video headend equipment. Tandberg TV has been focusing on high end, high quality applications while Skystream has provided a more cost effective system. Tandberg stated that it was considering developing a system more like Skystream’s, but decided that acquisition was the better course of action.
Tandberg TV stated that it has focused on tier 1 carriers and that Skystream has focused on the tier 3 carriers in the U.S. This is consistent with the view of the two companies in our latest IPTV Market Leader report, but we have seen that Skystream does have a significant position in both Europe and Asia.
Looking at this merger from the perspective of this IPTV Market Leader report on a pro forma basis, the combination would retain the number two position that Skystream now occupies, still way behind Tut in terms of channels deployed. Skystream’s number one position in Asia would be strengthened significantly. The merger would put the combination into strong competition for the number one position with Harmonic in Europe.
While this merger clearly strengthens the position of both companies, it is not clear that it will be able to survive as a standalone entity over the long run. Video encoding is a specialized technology that will resist further combination, but the difficulties of integrating IP TV systems and the positioning for service provider business may generate significant pressures for further combination.
{Note: analyst comments are italicized}
For more information, see our IPTV Market Leaders Report
Source: MRG, Inc., February 2006 IPTV Bulletin
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