Comcast, Moto Invest in CMAP Startup
Comcast Interactive Capital , Motorola Mobility Ventures and Spark Capital Partners LLC are seeding a startup that's developing a next-gen edge device that could play an important role in cable's migration to an all-IP access network infrastructure, Light Reading Cable has learned.
Industry sources say that the startup, Billerica, Mass.-based Benu Networks LLC , is developing a product for the Comcast Corp. (Nasdaq: CMCSA, CMCSK)-led Converged Multiservice Access Platform (CMAP) initiative, which is directing vendors to make next-gen, super-dense edge convergence platforms that combine edge QAM and cable modem termination system (CMTS) functions under one roof. Time Warner Cable Inc. (NYSE: TWC) has launched a similar project called the Converged Edge Services Access Router (CESAR). (See TW Cable Hails CESAR, Not CMAP and CMAP Vs. CESAR: Cable Clash in the Making?)
Benu's Website doesn't shed much light on the company's product focus, but people familiar with it say it's developing a CMAP chassis for Motorola Mobility LLC , with a longer-term goal that could see Moto buy Benu outright.
To Docsis vets, that strategy may sound eerily familiar; it's exactly the game plan that resulted in Moto's flagship CMTS, the BSR64000. RiverDelta Networks, another Boston-area startup, developed the product before being acquired by Motorola in 2001 for $300 million. (See Motorola Buys RiverDelta .)
In another fit of foreshadowing, Dave Callan, Benu's CEO, and Michael Brown, a Benu founder, both hail from Moto and RiverDelta, so it looks like the band is getting back together. [Ed. note: Several other former RiverDeltians helped another CMTS vendor, Casa Systems Inc. , get off the ground.]
Even more foreshadowing: Benu "is ushering in a new age of broadband service delivery. We've done it before and are doing it again," the company site proclaims. The Benu name also has some significance here. As the Egyptian equivalent to the Phoenix, it's a mythological bird that symbolizes creation and renewal. In this case, Benu, the company, is jumping in as cable looks to not just create, but reinvent, a converged IP network edge architecture.
Cable insiders like the strategy because they believe a sprightly startup such as Benu can develop a CMAP product much faster than Motorola could ever dream of creating on its own. "Anything that can help Motorola actually deliver [a CMAP] product is a good thing," says one cable exec.
Moto, meanwhile, discussed some of its internal plans for CMAP and a device called the Video Edge Services Platform (VESP) that would succeed the company's existing CMTS product line and bake in Ethernet routing capabilities. It's not clear if Moto will move ahead with VESP or look to lean on the work Benu is doing. (See Vendors Plan for Comcast's 'God' Box .)
As for Benu, the timing for such a startup could not be better, says Jeff Heynen, directing analyst for broadband and video at Infonetics Research Inc. "If you wanted to get into the CMTS or CMAP business at any point, this is your only chance for a while," he says, noting that operators will be looking to migrate to CMAP in the years ahead, and even look at possible forklift upgrades in some instances. "There certainly will be opportunities for new companies to break into the business."
The CMAP opportunity
But how big is the opportunity? Infonetics has yet to publicize its sizing of the CMAP market, but it currently pegs the combined CMTS and edge QAM market at $1.6 billion, and sees it growing to $2.4 billion in 2015. Moto has been able to sustain its CMTS business with just 10 percent of the market, well behind market leaders Cisco Systems Inc. (Nasdaq: CSCO) and Arris Group Inc. (Nasdaq: ARRS). (See Cisco Reclaims CMTS Lead.)
Even with Moto's backing, Heavy Reading Senior Analyst Alan Breznick still thinks Benu could have trouble displacing incumbent vendors. "They would have to bring a point of differentiation to bring any leeway to that market," he says.
Cable MSO execs who have a sense of Benu's roadmap say it's taking a fresh approach with its CMAP product plans, and isn't looking to retro-fit existing CMTS technology into something that simply adheres to the CMAP specifications. It's believed that Benu is focusing on an "integrated" version of CMAP that combines the architecture's Access Shelf (for the downstream and upstream PHY and MAC layer) and Packet Shelf (for packet processing).
Benu has not disclosed how much it has raised. Comcast and Motorola declined to comment for this story, but neither currently list Benu in their respective public investment portfolios (nor does Spark). Calls to Benu were not returned.
— Jeff Baumgartner, Site Editor, Light Reading Cable