Concurrent Not in Comcast's VOD Future
In a recent 10-K filing, Concurrent revealed Comcast Corp. (Nasdaq: CMCSA, CMCSK) had "notified us that our MediaHawk video platform was not approved for future deployments and that our existing deployed on-demand systems would be eventually removed from service."
Thus is Concurrent booted from Comcast's Next-Generation on Demand (NGOD) architecture.
The decision comes as analysts wonder if Concurrent can continue to go it alone. (See Concurrent Sidesteps M&A Talk .)
SeaChange International Inc. (Nasdaq: SEAC), a Concurrent rival, is firmly entrenched at Comcast following a new master agreement signed in 2006. Industry sources say other VOD server and back-office players that will also play a part in the MSO's new on-demand scheme include Cisco Systems Inc. (Nasdaq: CSCO), Motorola Inc. (NYSE: MOT), Tandberg Television , among others. (See Comcast Boosts SeaChange Revenues.)
Camiant Inc. , meanwhile, just outfitted its "universal" edge-resource manager to work with NGOD as well as with Time Warner Cable Inc. (NYSE: TWC)'s platform, the Interactive Services Architecture (ISA). (See Camiant Covers NGOD, ISA.)
A Comcast official said via email that the MSO has not made any official vendor selections for the NGOD project.
While the Comcast decision is obviously not great news for Concurrent, the blow is softened when one considers that Concurrent's reliance on Comcast revenues had started to fade anyway.
Comcast accounted for 11 percent of revenues for Concurrent's fiscal year ended June 30, 2007. By the end of fiscal 2008, Comcast no longer accounted for more than 10 percent of Concurrent's revenues. By then, just two customers held that distinction: Cox Communications Inc. (12 percent) and Time Warner Cable (10 percent).
Revenues were about the same for both years: $70.8 million in fiscal 2008, and $69.1 million in fiscal 2007. (See Concurrent Posts Q4.)
Concurrent is taking the hit in stride, holding that what it won't get with Comcast, it can make up via other VOD growth opportunities in North America, as well as budding markets in Europe and Asia. (See ZON TV Picks Concurrent.) Outside of video servers, Concurrent is confident it can win some deals for its MHBOSS back-office and its "Myriad" advanced ad platform. (See Concurrent Opens Its Back Office and Concurrent Shows Off.)
"Just as we sometimes get displaced by competitors, we do our fair share of displacing as well," says Tim Dodge, Concurrent's vice president of marketing and business development, pointing to a recent win in Time Warner Cable's Los Angeles market, where the MSO had been using Arris and SeaChange.
"It's a normal part of the business that, depending on the strategy that a company is trying to employ or the specific relationships they have with key vendors, they are going to make decisions that are going to affect vendors one way or the other," Dodge says, hopeful that Concurrent may still have some opportunities with Comcast somewhere down the road.
Concurrent has fared better with Cox. The Atlanta-based MSO has standardized its VOD platform on Concurrent servers and SeaChange's software. (See Cox VOD Effort Matches Vendor Rivals .)
So what's to happen to all that Concurrent gear Comcast is using now? No final decisions have been made but, unlike wine, VOD gear doesn't improve with age.
"It's not like we had a lot of state-of-the-art [equipment deployed with Comcast] that we'd want to go do something else with," Dodge says. "I wouldn’t say it's at the end of its useful life, but it's some fairly vintage stuff."
— Jeff Baumgartner, Site Editor, Cable Digital News