Despite its relatively small size, Casa Systems has emerged as the strong early leader in the still-developing market for next-gen Converged Cable Access Platform (CCAP) hardware.
Casa Systems Inc. , a brash startup based in the Boston suburbs, took home more than half of the CCAP equipment shipment revenues in the fall quarter, according to the latest report on the market by Infonetics Research Inc. . Infonetics found that Casa accounted for 57% of the roughly $95 million in shipment revenues for the quarter, or about $55 million. "They [Casa] just had a phenomenal quarter," said Jeff Heynen, principal analyst for broadband access and pay TV at Infonetics.
Arris Group Inc. (Nasdaq: ARRS) followed next with about 38% of the revenues while Harmonic Inc. (Nasdaq: HLIT) collected the remaining 5%. Neither Cisco Systems Inc. (Nasdaq: CSCO), the traditional leader in the closely related cable modem termination system (CMTS) business, nor CommScope Inc. , a player on the related edgeQAM device side of the business, scored in the CCCAP rankings for the quarter because they've gotten off to later starts in the market than their three rivals.
Cisco, however, remains the champion of the combined CCAP/CMTS/EdgeQAM market, followed by Arris. That's because CMTS devices still make up the bulk of the total equipment market, although that's starting to change now.
Casa, whose C100G device qualified as Light Reading's best new cable product of the year in 2013, declined to confirm the report's estimates of its CCAP device revenues. But a company source did say that the firm had "large shipments of CCAP products" during the fall months. He also said Casa is "already off to a great start [this year] with volume shipments of CCAP channels and expects that 2014 will be significantly better than 2013." (See 2013 Leading Lights Finalists: Best New Product (Cable) .)
Casa's early rush out of the gate comes as the CCAP market is clearly beginning to heat up. With the roughly $95 million in shipment revenues, CCAP devices accounted for 26% of the total $363 million in shipment revenues for the overall category in the fourth quarter, up from just 8% of the market's revenues in the third quarter, according to Infonetics. Reflecting that revenue surge, CCAP channel shipments nearly tripled in the fall, jumping 192%. (See CCAP Starting to Make Impact .)
"It seems that more and more cable operators are making the decision to go into their headends and start over again [with CCAP]," Heynen said. He credited at least part of the growing CCAP momentum to the desire of MSOs to prepare their networks for the deployment of the new DOCSIS 3.1 broadband standard, which is expected to start by the end of this year, and to remote PHY (physical layer) architectures.
Thanks to the CCAP surge, the combined equipment category saw shipment revenues jump 11% in the fourth quarter over the same period a year ago. But, for the entire year, the overall market actually contracted, falling 8% to about $1.3 billion in revenues. Heynen blamed the yearly drop-off primarily on channel price erosion in the CMTS sector, noting that the decline occurred despite record shipment of both CMTS and CCAP channels.
Infonetics projects that shipment revenues will grow steadily over the next four years as CCAP devices take over the market from their CMTS counterparts. The research group sees annual revenues rising about $100 million year to reach $1.7 billion by 2018, with CCAP devices accounting for the bulk of the shipments by 2016.
— Alan Breznick, Cable/Video Practice Leader, Light Reading