CMTS Now $1 Billion Business
The report states that global CMTS revenue climbed 51 percent between 2005 and 2006, while port shipments increased 39 percent. So, it seems that cable operators may actually be making headway on the CMTS price reductions they have long been pursuing, but only by buying in bulk.
Cisco Systems Inc. (Nasdaq: CSCO) controlled more than half of the worldwide market in 2006, generating $529 million in CMTS sales, according to Infonetics. Of course, for Cisco, CMTS products are only a tasty side dish. The MSO main course includes those routers, switches, and optical gear with juicier margins.
Surging CMTS sales continue to be driven by cable VOIP rollouts, as well as MSO moves to boost high-speed data access speeds in the face of telco fiber deployments. Eyeing a wideband future, cable operators are pushing vendors to implement more flexible, and less costly, CMTS architectures in two ways.
First, cable operators are prodding equipment suppliers to offer separate upstream and downstream line cards for CMTS chassis, as opposed to today's cards with fixed-port ratios. Second, MSOs are prompting vendors to break apart functionality via modular CMTS (M-CMTS) architectures, enabling cable systems to share universal edge QAMs for both digital video and Docsis data services.
Cable operators hope these moves will substantially shrink their per-subscriber and per-megabit CMTS costs. They can hope. Infonetics projects "single- to double- digit growth for both CMTS ports and revenue every year through at least 2010."
— Michael Harris, Chief Analyst, Cable Digital News