Despite a spurt of activity in Western Europe, the total expenditure by cable operators on new edge QAM and cable modem termination system (CMTS) equipment in the first quarter slumped as the operators delayed major purchases until later in the year, according to the latest data from Infonetics Research .
In its latest survey, Infonetics found that global edge QAM and CMTS revenue worldwide for cable equipment vendors came to US$327 million for the first three months of the year, down a whopping 25 percent from the same period a year ago. While the latest revenue figure represents a 9 percent increase from the fourth quarter of 2012, year-over-year comparisons are considered more valid metrics.
But that decrease may end up being just a blip for the year. Despite the slow start, Infonetics still expects this year's edge QAM and CMTS revenues and channel shipments to beat the industry's 2012 total of $1.39 billion. (See Arris CMTS Shipments Leap Past Cisco in Q4.)
That's because the firm sees MSOs preparing for the Converged Cable Access Platform (CCAP) era by installing denser line cards for their existing headend equipment, getting their networks operationally ready for CCAP upgrades and testing new CCAP gear throughout the rest of 2013.
Moreover, the research firm projects that edge QAM and CMTS revenues and shipments will climb further next year as North American and European cable operators begin deploying next-gen CCAP chassis and other devices in earnest. "The stage is being set for even bigger growth in 2014," stated Jeff Heynen, principal analyst for broadband access and pay TV.
In a call with the media, Heynen said he expects combined CMTS downstream and upstream channel shipments to climb to 1.7 million units this year. He then believes that figure will shoot up to 2.8 million in 2015 and 4 million in 2017 as cable operators deploy integrated and modular CCAP devices en masse.
Turning back to the first-quarter results, Infonetics reported that Western European cable providers accounted for much of the CMTS and edge QAM activity during that period. Breaking out of a recent slump, both CMTS channel shipments and revenues for equipment vendors more than doubled from the previous quarter's totals as Western European MSOs resumed their DOCSIS 3.0 system upgrades.
Infonetics also found that lower-cost CMTS channel shipments dominated the product mix in the first quarter.
In the closely watched vendor rankings, Cisco Systems took back the CMTS market crown from Arris during the first quarter.
Cisco, which had dropped to second place in the rankings in the latter part of 2012, accounted for 51 percent of the CMTS revenues in the latest quarter, according to Infonetics. Arris fell back to second place with a 31 percent revenue share, followed by Motorola Home (now part of Arris) with 12 percent and Casa Systems with 5 to 6 percent.
On the edge QAM device end, Cisco and Harmonic shared the lead in the first quarter. Infonetics reported that each vendor achieved between 30 and 35 percent of the sector's total revenues.
— Alan Breznick, Cable/Video Practice Leader, Light Reading