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Cisco Partner Tries to Break Moto's Grip on Tier 2s

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner

A partnership between Cisco Systems Inc. (Nasdaq: CSCO) and Adara Technologies Inc. that's focused on switched digital video (SDV), hybrid IP/QAM set-tops and a new interactive program guide is looking to break Motorola Mobility LLC 's stranglehold on the Tier 2/3 MSO market

Adara's primary targets are small and mid-sized operators that are trying to free up bandwidth to make room for larger HD lineups to compete with the likes of DirecTV Group Inc. (NYSE: DTV) and Dish Network LLC (Nasdaq: DISH).

But instead of using analog reclamation strategies that rely on digital terminal adapters (DTAs), Adara is proposing the use of a hosted SDV platform along with Cisco's boxes and Reference TV Navigator (RTN) middleware and user interface. Aside from the bandwidth savings, Adara believes that its approach with SDV will help smaller MSOs make the transition to IP video.

Adara intends to add multiscreen to the mix in 2012 using Cisco's Videoscape platform. (See CES: Cisco Unveils Master Plan for Video and Can Videoscape Save Cisco's Set-Top Business?)

Playing small ball with 'full-lineup' SDV
Costs and the required amount of engineering resources have historically made SDV the domain of large MSOs, but Adara, a company founded in 2006, believes its managed, hosted model will make switched digital video economically and technically feasible even for the smallest of cable operators.

Adara claims to absorb about 80 percent of the cost of SDV. Its approach puts the bulk of the SDV control systems (the Cisco digital video control system, app servers and conditional access servers) at Adara's facility in Toronto. The operator only needs to hook in (a 10Mbit/s to 15Mbit/s connection to handle things like guide and app data) and install the Cisco bulk encryptor and SDV resource manager locally, according to Adara CEO Joseph Nucara, a former Philips Electronics exec.

Because the heavy lifting of SDV, such as session setups and breakdowns, occurs at the operator's headend, latency is kept at a minimum, ensuring channel-change times of about 30 milliseconds. "It's no different than a standalone SDV solution," Nucara claims.

Another big twist is that Adara is suggesting operators switch their full video lineups instead of just a smaller tier of channels that's set aside for SDV, which is how most MSOs use the technology. This full-lineup approach would make the video service behave much like U-verse or any other IPTV platform. But to make that happen, Adara estimates that operators would need to free up eight QAM channels for service groups of about 1,000 set-top boxes. (See Cable Cable Does SDV SDV.)

He says Adara has deployments set or underway with between 50 and 100 cable operators, with the largest having "hundreds of thousands of subscribers." However, the only announced deployment so far is with Cable Cable Inc., an Ontario-based operator with about 4,200 customers. Cable Cable launched SDV in 2009, and has boosted its number of HD channels from 25 to 100. (See SDV: Cable's Stepping Stone to IP Video? )

Moto offers hosted SDV, too
Adara's approach may sound familiar. Motorola and BigBand Networks Inc. (Nasdaq: BBND) announced a similar partnership last summer that was to lean on Moto's Secure Operations Center in San Diego. No deployments have been announced. (We've asked Motorola for an update.) (See Moto, BigBand Play Small Ball With SDV.)

The non-exclusive partnership with Adara gives Cisco an entrée to hundreds of Tier 2/3 MSOs, a market that Motorola has typically dominated. Evolution Digital LLC is also targeting that group with an analog reclamation strategy that uses simple DTAs, broadband-connected TiVo Inc. (Nasdaq: TIVO) boxes and Conax AS security. (See Canadian MSO Fires Up TiVo/Evolution Combo and Evolution, Conax Sign Exclusive Deal.)

Adara holds that its hosted SDV system is less expensive than other bandwidth-saving strategies while offering a better capacity punch.

Table 1: Cost Comparison

Approach Cost per home passed Capacity increase
1GHz plant upgrade $30-$100 15%-35%
All-digital (analog reclamation) $180-$250 50%-125%
MPEG-4 $100-$120 10%-15%
SDV $5-$40 500%+
Source: Adara

Adara is also setting it up so that the new Cisco-based platform can coexist with an operator's older Moto environment; the operator could then switch customers over when they sign up for new (and more expensive) service tiers that tap the Cisco environment.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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Pete Baldwin
Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 5:03:50 PM
re: Cisco Partner Tries to Break Moto's Grip on Tier 2s

"Cable Cable Inc."??

It sounds like a 30 Rock parody of a Hello Kitty-themed TV service.

Jeff Baumgartner
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:03:49 PM
re: Cisco Partner Tries to Break Moto's Grip on Tier 2s

That, or they went to the Little Ceasars school of marketing (Pizza! Pizza!) JB

Jeff Baumgartner
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:02:55 PM
re: Cisco Partner Tries to Break Moto's Grip on Tier 2s

Moto sent along word, citing Chris Poli, its director of conditional access and switched digital products, that their hosted SDV is in operation and that they're completing the final stage of a field trial wtih an unnamed operator.  They're currently quoting new systems for design/launch, we're told. JB


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