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Cisco keeps lead in most video infrastructure market segments, but Arris pulls away in client hardware and software, according to new report.

Cisco Maintains Video Dominance

Alan Breznick
12/24/2013
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Cisco is still the king of the global video infrastructure market, but Arris and Pace are continuing to make gains in different segments, according to a new research report.

In its latest report, Synergy Research Group Inc. found that Cisco Systems Inc. (Nasdaq: CSCO) kept up its lead in four of the five video infrastructure market segments tracked in the third quarter. Cisco also maintained its lead in overall market share despite a strong surge by Arris Group Inc. (Nasdaq: ARRS) earlier this year after its acquisition of Motorola Home.

But Arris, Pace plc , and Hewlett-Packard Co. (NYSE: HPQ) all scored gains against Cisco in at least one of the five market segments. In particular, Arris and Pace shone in the video client hardware and software segment, which covers set-top boxes, home media gateways, and related middleware and software.

John Dinsdale, managing director of Synergy Research, said Cisco's overall share in the annual $37 billion market slipped on a sequential basis to 20.7% in the third quarter, down slightly from 20.8% in the second quarter. But that still represented an increase from a 20.5% share in the year-ago period.

Cisco, which enjoyed about a 2% overall market-share bump last year after its acquisition of NDS, maintained its market-leading position by dominating such segments as content distribution, content acquisition and preparation, and content management. It also led in the media datacenter segment, although by a narrow margin over HP.

Arris, which received a much bigger 7.5% bump in overall market share after it gobbled up Motorola, claimed the top spot in the video client segment by beating out Cisco and Pace easily. But Pace made strides here too, overtaking Cisco for the number two spot.

In another bright spot for Arris, it closed part of the gap with Cisco in the content management segment. Synergy reported that Arris carved out slightly over a 15% share in this segment, as compared to about 28% for Cisco.

Dinsdale said total market revenues climbed to more than $9.4 billion in the third quarter, up slightly from just under $9.4 billion in the second quarter and up 3% from slightly under $9.2 billion in the year-ago period. He said the market's average annual growth rate is now about 2.5% on a rolling four-quarter basis.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

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albreznick
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albreznick,
User Rank: Blogger
12/30/2013 | 5:37:28 PM
Re: Set-tops
Good point. I'm sure it is a factor. But it's not clear how much. Would be nice if Cisco spelled that out for us.  
DOShea
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DOShea,
User Rank: Blogger
12/27/2013 | 4:55:49 PM
Set-tops
Some of Cisco's loss in the set-top market must be due to it effort to exit low-margin segments. I wonder how much that is a factor.
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