Light Reading

Ex-Cisco Execs Form Cable Set-Top Startup

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
6/1/2012
50%
50%

Some former Cisco Systems Inc. (Nasdaq: CSCO) and Scientific-Atlanta employees have gotten the band back together to create iNovo Broadband Inc. , a startup angling to become a new source for cable set-tops, cable modems and other consumer premises equipment (CPE).

If operators buy in, iNovo would set the stage for fresh competition against cable's incumbent set-top suppliers, especially Cisco, Motorola Mobility LLC and Pace plc .

A startup's lower overhead and lack of an installed base will let Duluth., Ga.-based iNovo provide CPE gear "at a very competitive price," said CEO Jack Miller, during an interview at The Cable Show last week in Boston.

Miller worked for Scientific-Atlanta for nine years before starting N2 Broadband, a video-on-demand (VoD) backoffice vendor that was sold to Tandberg Television in 2004 for $118 million and is now part of Ericsson AB (Nasdaq: ERIC)'s video product lineup. He and Himanshu Parikh, iNovo's CTO and a former VP and GM at Cisco/Scientific-Atlanta, are the principal founders of iNovo, and they began assembling their team about a year ago.

Most of the iNovo team also hailed from Cisco/Scientific-Atlanta and is comprised of cable vets who have not just designed, managed and sold cable CPE, but have also managed relationships with manufacturers such as Foxconn Electronics Inc. , Askey Inc. and Unihan Corp.

Ajith Nair, iNovo's VP of engineering, helped develop SA's first set-top box and was the main hardware architect for eight generations of boxes. Doug Woodhead, the company's principal engineer, directed the ASIC development group at Cisco/S-A. And Benny Hsu, iNovo VP of manufacturing partners, once managed the offshore, high volume manufacturing relationships for Cisco's home networking business unit.

"We have all the disciplines and experience needed to compete in the CPE business," Miller said.

Shaking things up
iNovo arrives amid a cable set-top shakeup. Google (Nasdaq: GOOG) acquired Motorola Mobility, and Panasonic Corp. (NYSE: PC) recently exited the domestic cable set-top business. Cisco recently sold its set-top box factory to Foxconn but keeps saying that it remains fully committed to the set-top box market. (See Google Closes $12.5B Motorola Deal , Will Moto Go Back to the Future?, Foxconn Buys Cisco's Set-Top Factory , Panasonic Exits US Cable Set-Top Biz and Why Cisco Wants Out of Set-Tops (Or Not).)

"There's a lot of turmoil in the market," Miller said, and iNovo took advantage of it as Cisco scaled back its operations on Sugarloaf Parkway in Lawrenceville, Ga. "There were some very good people available."

Miller thinks iNovo has the institutional knowledge and technical know-how to take MSO-defined CPE specifications through the hardware integration and building phases by shepherding that work through the manufacturers -- expertise that cable operators don't have.

iNovo got off the ground last November, has already shipped one product to a customer for evaluation and hopes to notch its first deployment deals before the end of 2012, Miller said. He's mum on which product is being evaluated, but the company lists a sizable lineup of CPE categories it's pursuing, including standard- and high-def digital transport adapters (DTA), IP-based set-tops, Docsis modems and gateways, and indoor and outdoor Wi-Fi access points.

The company has raised more than $1.5 million in seed financing and has begun to pursue an "A" round targeting about $10 million.

iNovo is also looking for "strategic investment from MSOs," Miller said. That's a path he's travelled before. Time Warner Cable Inc. (NYSE: TWC) participated in N2 Broadband's A round and deployed N2's OpenStream, a VoD backoffice system that let operators use video pumps from multiple vendors and played a big role in dropping costs to about $100 per stream from $300 in less than three years.

— Jeff Baumgartner, Site Editor, Light Reading Cable

(5)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Pete Baldwin
50%
50%
Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 5:31:23 PM
re: Ex-Cisco Execs Form Cable Set-Top Startup


I certainly appreciate iNovo's credentials, but... weren't set-top boxes supposed to go away?


I'm only half kidding. These guys sound capable of doing good stuff, but this could also be a recipe for a commodity-box contender.

AESerm
50%
50%
AESerm,
User Rank: Light Beer
12/5/2012 | 5:31:21 PM
re: Ex-Cisco Execs Form Cable Set-Top Startup


And margins here will, of course, be thinner than in a software-centric business like n2Broadband.

gconnery
50%
50%
gconnery,
User Rank: Light Sabre
12/5/2012 | 5:31:20 PM
re: Ex-Cisco Execs Form Cable Set-Top Startup


Yeah, I don't get why somebody would enter this business now.  The business is already in decline as margins have been reduced to nothing even for the major players.  Samsung has a chance because they're fully integrated, but these guys are either going to have to use commodity silicon (at high prices because of their low volume) or develop their own ASIC (on $1.5M... hah, they'll be out of business before they get it done, VCs don't have the stomach for ASIC development anymore) which will take forever.


And the whole innovation thing?  Please, Motorola and Cisco had lots of good ideas for innovations.  But the cable companies don't want any of that.  They want the cheapest possible set top and they want it to be a commodity at multiple vendors built to THEIR specifications.


These guys are going to have their heads handed to them.

Soupafly
50%
50%
Soupafly,
User Rank: Light Sabre
12/5/2012 | 5:31:18 PM
re: Ex-Cisco Execs Form Cable Set-Top Startup


I think your all missing the point.


These guys are using a "virtual company" model to create a set of competitive platforms. They are not saying they are going to build silicon themselves or design and build a ene-to-end integrated platform including components.


It seems from the piece and quick read of the website that they are going to work with the chinese & global ODM/OEM and Silicon communities to define, spec, manufacture & build a box thats targetted & relevant to the MSO community.


My Impression of the Key ingredients they offer are;


1) Expertise in "anchor customer" acquisition & execution.


2) Platform depth & breadth encompassing the silicon, hardware & software layer reqs.


3) Domain Expertise; These guys KNOW this industry. They have contacts & credibility to burn.


My key concern is whether they can consistently add value over various generations of their platform?


Fail to do that and what you guys predict will happen quickly. They will enter a battle to the bottom "war" of attrition. Very few exit such battles, fewer still with no bruising.


OR; They could be planning to exit the business by that point, hence the VC cash for a spin-out / in vehicle to a vertical or horizontal integration player.


Time will tell...


SF

Jeff Baumgartner
50%
50%
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:31:13 PM
re: Ex-Cisco Execs Form Cable Set-Top Startup


Although iNovo has someone in-house with lots of ASIC expertise, I didn't get the impression that they'll be making chips, particularly now that cable's got a variety of sources now for those components, including Broadcom, Marvell, Entropic (thanks to the purchase of Trident's assets), and Sigma Designs, to name just a few. But it will be interesting to see if they can indeed bring these MSO-specified products to market for less than the incumbent suppliers. It stands to alter the business model a bit if they can pull it off. And while the long-term of the STB is in doubt as more of that functionality becomes virtual inside connected devices, i still think the death of the STB is still a ways out.  The nearer term question is whether suppliers like Cisco and Motorola really want to stick it out in that market, or if the market conditions make this a great opportunity for a much smaller company like iNovo, with the relationships and the know-how,  to step in and be successful. JB


 

Flash Poll
From The Founder
The New IP is actually bigger even than business. Like another hugely important tech that Light Reading is digging into right now, the New IP has the potential to change the world by fundamentally advancing what it is possible for people to achieve with communications.
LRTV Huawei Video Resource Center
Huawei Shares Its Vision of the Future of Mobile Networks Innovations

2|26|15   |   2:30   |   (0) comments


Mobile broadband is changing our lives. It's reshaping the Internet, industry, and society. It allows us to freely connect with one another anytime, anywhere. At this year's Mobile World Congress, Huawei will share its latest insights and newest ideas and technologies that will shape the future of MBB. They will showcase their end-to-end MBB solutions that will ...
LRTV Huawei Video Resource Center
Accelerate Digitizing, Boost Digital Business

2|26|15   |   6:14   |   (0) comments


A new digital revolution is leading us to a better connected world. Together with millions of digital partners, Huawei will help CSPs to build their digital service ecosystem and aggregate a wide variety of digital services. In this video, we find out how Huawei is going to help CSPs implement digital operations.
LRTV Huawei Video Resource Center
The Secret Recipe to Enabling Hyper-Growth Industries

2|26|15   |   3:38   |   (0) comments


With a number of successful cases on network capability exposure, Huawei is going to share the secret recipe to enabling hyper-growth markets with a step-by-step approach.
LRTV Documentaries
BTE 2015 Is Bigger & Even Better

2|25|15   |   03:13   |   (3) comments


This year's Big Telecom Event (BTE) in Chicago is going to provide more opportunities than ever for networking, getting to grips with key industry challenges and opportunities and, equally as important, having some fun.
LRTV Interviews
Light Reading ICT Leaders Roundtable at MWC 2015

2|12|15   |   1:07   |   (2) comments


On Sunday March 1, 2015, Light Reading will host an ICT Leaders Roundtable in partnership with Huawei. At this half-day event, CIOs, analysts and researchers will discuss key industry trends like virtualization in the cloud with a specific focus on new business models. Located at the luxurious Renaissance Hotel near the Fira Barcelona, space is limited so please ...
LRTV Documentaries
Going Green in 2015

2|12|15   |   02:04   |   (0) comments


Energy efficiency is set to be an incredibly hot topic in the telecom industry this year.
LRTV Custom TV
SDN & NFV: Where Are We Going From Here?

2|11|15   |   11:27   |   (0) comments


Vitesse Semiconductor CTO Martin Nuss gives his perspective on why SDN and NFV should be tightly interconnected and how he sees the industry moving forward.
LRTV Documentaries
Time for Gigabit Europe?

2|9|15   |   01:27   |   (4) comments


Gigabit broadband networks are springing up all around the US and they'll soon become more commonplace in Europe.
LRTV Interviews
Brocade Brings New IP Vision to 2020 Vision Executive Summit

2|3|15   |   4:23   |   (0) comments


In December 2014, Light Reading gathered telecom executives in Reykjavik, Iceland to discuss their vision for high-capacity networks through the end of the decade. The intimate, interactive meeting was set against the backdrop of Iceland's spectacular natural beauty. As one of the event's founding sponsors, Brocade's Kelly Herrell shared his company's strategy at ...
LRTV Interviews
Brocade's Kelly Herrell on the New IP

2|2|15   |   12:36   |   (0) comments


In December 2014, Steve Saunders sat down with Brocade VP of Software Networking Kelly Herrell at Light Reading's 2020 Vision executive summit in Reykjavik, Iceland. They spoke about Brocade's approach to the New IP, the future of the telecom industry, and more.
LRTV Huawei Video Resource Center
Dr. Dong Sun Talks About Carriers' Digital Transformation & Huawei’s Telco OS

1|29|15   |   6:28   |   (0) comments


Dr. Dong Sun, Chief Architect of Digital Transformation Solutions at Huawei, discusses how telecom operators can become digital ecosystem enablers and deliver optimal user experiences that are in real-time, on-demand, all-online, DIY and social (ROADS).
LRTV Huawei Video Resource Center
Huawei's Chief Network Architect Talks about Network Experience & Operators’ Strategies

1|29|15   |   3:39   |   (0) comments


In the digital age, network experience has become the primary productivity especially for telecom operators. In this video, Wenshuan Dang, Huawei’s Chief Network Architect, discusses how carriers can tackle the challenge of infrastructure complexity in order to enhance business agility and improve user experience.
Upcoming Live Events
March 17, 2015, The Cable Center, Denver, CO
April 14, 2015, The Westin Times Square, New York City, NY
May 12, 2015, Grand Hyatt, Denver, CO
All Upcoming Live Events
Infographics
Net neutrality, broadband services and the current outlook on data consumption, as presented by the New Jersey Institute of Technology.
Hot Topics
Cyber Security Expert Warns: You're Doing It Wrong
Sarah Thomas, Editorial Operations Director, 2/23/2015
10 Weirdly Useful IoT Devices
Eryn Leavens, Copy Desk Editor, 2/24/2015
Small Cells Enabling Location Services
Sarah Thomas, Editorial Operations Director, 2/25/2015
Is FCC Weighing Net Neutrality Changes?
Mari Silbey, Independent Technology Editor, 2/25/2015
MWC: Let the Madness Begin
Ray Le Maistre, Editor-in-chief, 2/23/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Check out Light Reading's interview with Jay Samit, the newly appointed CEO of publicly traded SeaChange International Inc. With a resume that includes Sony, EMI, and Universal, Samit brings a reputation as an entrepreneur and a disruptor to his new role at the video solutions company. Hear what he had to say about the opportunities in video, as well as the outlook for cable, telco, OTT and mobile service providers.
G'day! And welcome to an entirely new feature on Light Reading -- our weekly "CEO-to-CEO" interview.