Nokia Swings Deal for Gainspeed

Mari Silbey
News Analysis
Mari Silbey, Senior Editor, Cable/Video

Proving its determination to generate new revenue from the cable industry, Nokia announced this evening its intent to acquire distributed access network specialist Gainspeed. No financials were disclosed.

Adding drama to the narrative is the fact that Nokia Corp. (NYSE: NOK) rival Juniper Networks Inc. (NYSE: JNPR) has long been an investor in Gainspeed and a strategic marketing partner. It appears that Juniper is now left out in the cold after helping to fund the startup company and foster Gainspeed through its early-stage growth.

Gainspeed's claim to fame is a virtual Converged Cable Access Platform (CCAP) device that is designed to push many of the functions of a DOCSIS-powered cable network closer to the network edge. The goal is to miniaturize and virtualize the functions of a CCAP chassis so that more of the cable network can be software-controlled, and operators can save both space and power in the headend. (See Q&A: Gainspeed's New CEO Rides IP Wave .)

The idea of a distributed access architecture (DAA) approach has gained supporters throughout the cable industry, but different companies have very different ideas about how DAA should be implemented. While deploying a virtual CCAP device is one possibility, there is also the option to take a more phased approach, retaining some intelligence in the headend with a standard CCAP chassis and only pushing some functionality out to the network node. Cisco Systems Inc. (Nasdaq: CSCO), in particular, is promoting this Remote PHY strategy, which has the advantage of also allowing the company to continue selling its CCAP hardware. (See Cisco's Open Source Moves Not All Altruistic.)

Cisco, Arris Group Inc. (Nasdaq: ARRS) and Casa Systems Inc. are the top vendors of current CCAP equipment.

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In the press release announcing the Nokia acquisition, Gainspeed was able to collect supporting quotes for the transaction from top cable executives, including Tony Werner, president of technology and product for Comcast Cable at Comcast Corp. (Nasdaq: CMCSA, CMCSK), and Liberty Global Inc. (Nasdaq: LBTY) CTO Balan Nair.

Werner said, "New and innovative services in broadband are important to us and to our customers. We appreciate technology partners who make innovation one of their core values and look forward to Nokia and Gainspeed joining forces to bring new technologies and products to the industry."

The Gainspeed press release also gives the first public indication to date of an actual Gainspeed customer. In the announcement, WideOpenWest Holdings LLC (WOW) CTO Cash Hagan said, "We are well down the path testing and preparing for deployment of Gainspeed's Virtual CCAP solution and have been using Nokia access products for years. We are excited to see these technology leaders coming together, and view their solutions as a key strategic component in our network evolution and delivery of gigabit services."

Gainspeed was founded in 2012 and currently has around 70 employees. At Nokia, Gainspeed will join the Fixed Networks group, headed by Federico Guillen. It's the first time Nokia has had a technology solution directly targeted toward cable HFC networks.

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

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