Cisco to buy NDS, sell STB manufacturing?
Value creation in pay-TV distribution is shifting from CPE to software. Cisco is not alone in thinking this.
Value creation in pay-TV distribution is shifting from CPE to software. Cisco is not alone in thinking this as Pace is making a similar shift from hardware-based solutions to its Elements software platform on a range of STBs.
Cisco has strong head-end and network solutions, but any user of a Cisco set-top box will not have kind things to say about their STB software. NDS is perhaps the perfect complement to Cisco’s Videoscape strategy, being the premiere creator of set-top box software solutions. The combined company would provide security for an estimated 30% of all active set-top boxes that support encryption.
However, with the exception of Cisco and Motorola, conditional access (CA) businesses generally operate separately from set-top box businesses. The reason is that operators want to have multiple set-top box vendors but are resigned to having single security vendors and software vendors. North American cable is the only major exception to this rule.
Therefore, it may now make sense for Cisco to sell its set-top box and broadband gateway manufacturing unit while retaining its PowerKEY conditional access system and a few other pieces of Scientific Atlanta that are integral to the Videoscape strategy. To take any other path might threaten the value of the existing NDS business.
I would note that the need to spin-off the set-top box business is not nearly as strong as it is in the Google acquisition of Motorola; it is probably manageable. However, the combined business would have some conflicts of interest with customers that weren’t there before.
It should also be noted that no Cisco STB (or PowerKEY) customer except Cablevision is also a major NDS customer.
Case Study Database
Get more exposure for your case study by uploading it to the Plant Engineering case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.
These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.
Click here to visit the Case Study Database and upload your case study.
Annual Salary Survey
In a year when manufacturing continued to lead the economic rebound, it makes sense that plant manager bonuses rebounded. Plant Engineering’s annual Salary Survey shows both wages and bonuses rose in 2012 after a retreat the year before.
Average salary across all job titles for plant floor management rose 3.5% to $95,446, and bonus compensation jumped to $15,162, a 4.2% increase from the 2010 level and double the 2011 total, which showed a sharp drop in bonus.