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Scoping Out Scopus

Jeff Baumgartner
12/23/2008

1:10 PM -- Following this morning’s call with analysts, Harmonic Inc. (Nasdaq: HLIT) rendezvoused with the press to offer more details about its deal to acquire Scopus Video Networks (Nasdaq: SCOP) for about $51 million. One message it brought to the table: Don’t blow product overlaps between the two companies out of proportion. (See Harmonic Scoops Up Scopus for $51M.)

Although both companies make video encoders, Scopus’s are much more focused on the “contribution/distribution” sector, which requires the gear, for example, to support low-delay requirements for the purposes of video-based newsgathering, explained David Price, Harmonic’s VP of business development and marketing communications.

Harmonic’s products in the category, he said, have been targeted to high-quality, multi-path encoding. “Rarely have we lost business to them… and rarely have they lost business to us,” he said.

Price noted that Harmonic has often looked at entering the contribution/distribution sector, “but we haven’t had the resources to develop the technologies needed.” Evidently, buying that capability outright made much more sense.

Still, the companies do overlap more significantly when it comes to statistical multiplexers -- equipment that enables operators to cram in multiple digital programming feeds into a fixed channel space. Price said there may be room for both products in Harmonic’s portfolio, but those decisions have yet to be fleshed out.

What Scopus brings to the table that’s new is an integrated receiver decoder, a product that Harmonic has been reselling.

And what about those 300 Scopus employees, including its CEO, Yaron Simler? Will there be a role for him at the new company? Stay tuned.

Price said it’s “too early” to say. “The ink is just drying on an agreement.”

However, he anticipates that Harmonic should have a number of those decisions (people and products) made by the time the 2009 National Association of Broadcasters (NAB) show rolls around in late April.

— Jeff Baumgartner, Site Editor, Cable Digital News

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