Light Reading

Verizon Set-Top RFP Could Be Worth Billions

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
7/13/2007
50%
50%

Verizon Communications Inc. (NYSE: VZ) has put out a huge request for proposal (RFP) seeking "next-generation" set-tops and conditional access technologies that could be valued in the multibillion-dollar range, Cable Digital News has learned.

According to sources familiar with the project, Verizon issued the RFP, titled "Next Generation Set-Top Box (NGSTB) and Conditional Access System (CAS)," on June 15 and recently extended the deadline for vendor submissions to Monday, July 16, 2007. The RFP is looking for a set-top volume on the order of 26.5 million units, which could make it worth multiple billions of dollars.

"This is the largest dollar RFP amount I've ever seen," said one source familar with the request. "It's like getting in with an operator like Comcast on the ground floor."

Verizon has the project on a fast track, as it's believed the telco plans to reply to respondents by August.

A Verizon spokeswoman declined to comment, noting that such requests are issued under non-disclosure agreements. "Typically, we don't comment on that sort of thing until we sign a vendor or are ready to announce something," she said

It's not yet known who has responded to the RFP, but it should draw plenty of attention from set-top box makers and conditional suppliers looking to unseat incumbent Motorola Inc. (NYSE: MOT) as Verizon's go-to video supplier. Likely candidates could include Scientific Atlanta /Cisco Systems Inc. (Nasdaq: CSCO), Samsung Corp. , LG Electronics Inc. (London: LGLD; Korea: 6657.KS) , Pace Micro Technology , NDS Ltd. , Irdeto Access B.V. , Kudelski Group , Widevine Technologies Inc. , Advanced Digital Broadcast (ADB) , and Amino Communications Ltd. , among others.

As an incumbent, Motorola is also a contender, but price competition against Motorola is considered another purpose for Verizon's RFP, so, at the very least, margins could come under attack.

"They [Verizon] just know they want an open system and a choice of CE companies," says a person familiar with the RFP.

Motorola declined to comment on specific questions pertaining to the RFP, noting that it is not the company's policy to comment on customer activities. "We can tell you that Motorola is currently supporting Verizon's successful rollout of video services and will continue to support this and other initiatives going forward," the company said, in a prepared statement.

Among Verizon's aims, it's expected the RFP will vet options for a downloadable conditional access system (DCAS) that would satisfy the Federal Communications Commission (FCC) July 1, 2007, mandate that newly purchased and deployed set-tops use a separable security system. (See Countdown to 'Seven-Oh-Seven'.)

For the moment, Verizon (like many other service providers) is temporarily protected by an FCC-granted "Omnibus" waiver that allows the telco to continue using set-tops with integrated security on the promise that it will migrate to an all-digital platform by Feb. 17, 2009. (See Verizon & Others Get Their Waivers and Waiver Fallout .)

The RFP represents a bit of a threat to Motorola's position at Verizon. Today, Motorola is Verizon's only supplier for set-tops and the integrated CAS. The Motorola QIP product line Verizon employs is outfitted to handle traditional cable-like QAM signals as well as IP-based feeds, but the security is embedded in the device. Down the road, Verizon could opt to run a simulcrypt technique that allows Motorola's CAS and a security system from another provider to operate on the same system.

In seeking a waiver on its current line of QIP set-tops, Verizon disclosed it is looking to implement a "truly interoperable downloadable conditional access system."

Although a downloadable security system could result from Verizon's RFP, it's not necessarily a focus. Sources say the document doesn’t necessarily specify a platform that is downloadable or is akin to physically-modular CableCARD or SmartCard systems.

"They're keeping their options open," says a source familiar with the RFP.

— Jeff Baumgartner, Site Editor, Cable Digital News

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Jeff Baumgartner
50%
50%
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 3:05:21 PM
re: Verizon Set-Top RFP Could Be Worth Billions
Separately, VZ seems interested in using more than one security scheme at once. Does this throw cold water into CSCO's "end to end" story?

- Not if Verizon opts for the Scientific Atlanta PowerKEY system, but that decision won't be made for some time, I think.

materialgirl
50%
50%
materialgirl,
User Rank: Light Beer
12/5/2012 | 3:05:21 PM
re: Verizon Set-Top RFP Could Be Worth Billions
Is there any chance that the struggles MOT management is experiencing with their cell phones and their investor base are spilling over into their network equipment segment? Separately, VZ seems interested in using more than one security scheme at once. Does this throw cold water into CSCO's "end to end" story? If MOT loses set top share, does that also reflect further into the network as share loss?
Educational Resources
sponsor supplied content
Educational Resources Archive
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.
Que Sera Sarah
Growth of the 5G Ecosystem

3|6|15   |   1:15   |   (1) comment


Use cases and industry collaborations dominated 5G discussions during Mobile World Congress 2015. For what the road to 5G means for operators and their partners, head to the Building America's 5G Ecosystem event in New York on April 14.
LRTV Custom TV
Sonus NaaS IQ Real-Time Demo

3|6|15   |   4:03   |   (0) comments


Compass Networks Chairman and CEO Matt Bross and Ray Dolin, CEO of Sonus Networks, demonstrate their Sonus IQ SDN solution using a live video conference connection.
LRTV Custom TV
LRTV Talks Carrier WiFi & WiFi Calling With Aptilo Networks

3|6|15   |   4:53   |   (0) comments


We stopped by Aptilo Networks, a market leader in WiFi service management and offloading, to discuss the new possibilities with next-generation WiFi calling and why WiFi should be a natural part of any operator strategy.
LRTV Interviews
NGMN Chairman Outlines His 5G Vision

3|6|15   |   5:10   |   (1) comment


Bruno Jacobfeuerborn, chairman of the NGMN Alliance and Deutsche Telekom CTO, shares his thoughts on the challenges, opportunities and costs of 5G.
LRTV Interviews
In the Cloud With Telecom Italia

3|5|15   |   7:10   |   (0) comments


Light Reading CEO Steve Saunders sits down with Telecom Italia's Simone Battiferri at Mobile World Congress to discuss virtualization, agility and the economic advantages of the cloud.
LRTV Huawei Video Resource Center
New Ways of Working

3|5|15   |   4:24   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Hong Kong Telecom's Michael Yue explains how the transformation in its business has changed its customer relationships.
LRTV Huawei Video Resource Center
Bridging the Digital Gap

3|5|15   |   4:03   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Boingo's Dr. Derek Peterson explains how ICT can help telcos bring the physical and virtual worlds closer together.
LRTV Huawei Video Resource Center
Making the Internet of Things Affordable

3|5|15   |   2:42   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Telefonica's Dr. Mike Short explains how the Internet of Things demands a new low-cost approach to connectivity from telcos.
LRTV Huawei Video Resource Center
Evolution, Not Revolution

3|5|15   |   2:00   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Heavy Reading's Patrick Donegan explains why telcos can't be too hasty in their efforts to transform themselves.
LRTV Custom TV
Management & Orchestration Enablement Strategies Required for NFV Commercial Success

3|5|15   |   6:22   |   (0) comments


NFV commercial success rests on successful service orchestration strategies which can span heterogeneous physical, virtual, legacy and next-gen networks. Network data and security integrity are additional key aspects. Nakina provides a suite of orchestratable network integrity applications built on an open, scalable MANO enablement platform.
LRTV Huawei Video Resource Center
The Power of Five Convergences in OceanStor OS

3|4|15   |   6:24   |   (0) comments


OceanStor OS is Huawei's brand-new storage operating system. While inheriting the consistent high stability, reliability and performance from the company's previous storage products, OceanStor OS abounds in new converged storage features. Specifically, the new storage operating system achieves "five convergences" to lift storage convergence to a higher level.
LRTV Huawei Video Resource Center
4K Brings Extreme Video Experience

3|4|15   |   8:10   |   (0) comments


4K video is a hot topic in the video industry. It will certainly bring an extreme video experience to end users. At the same time, however, it will also pose a big challenge to operators. Check out this Huawei 4K experts' discussion about how operators can achieve success in 4K video service.
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
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
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
Internet Pioneers Decry Title II Rules
Carol Wilson, Editor-at-large, 3/2/2015
Wheeler: We'll Enforce Title II 'Case-By-Case'
Sarah Thomas, Editorial Operations Director, 3/3/2015
New CenturyLink CTO in Major Overhaul
Carol Wilson, Editor-at-large, 3/4/2015
Alibaba 'Planting a Flag' in US Cloud Market
Mitch Wagner, West Coast Bureau Chief, Light Reading, 3/4/2015
Few in Number, Big in Data
Sarah Thomas, Editorial Operations Director, 3/2/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Chattanooga’s EPB publicly owned utility comms company has become a poster child for how to enable a local economy using next-gen networking technology. Steve Saunders, Founder of Light Reading, sits down with Harold DePriest, president and CEO of EPB, to learn how EPB is bringing big time tech to small town America.
Light Reading CEO Steve Saunders talks transformation and virtualization – including Light Reading's independent testing of the vendor's virtualization solutions – with Cisco CEO John Chambers at Mobile World Congress in Barcelona.
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.