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Sources: Comcast Has Movaz Stake

Light Reading
News Analysis
Light Reading
7/30/2004

It must be ROADM appreciation week here at Light Reading.

One ROADM vendor -- Tropic Networks Inc. -- announced a key investment and distribution agreement with Alcatel SA (NYSE: ALA; Paris: CGEP:PA), a move widely interpreted as a vote of confidence in Tropic's technology.

But now Light Reading has unearthed details of another ROADM strategic investor. Late last year, Comcast Corp. (Nasdaq: CMCSA, CMCSK) made a strategic investment in Movaz of at least $5 million, according to sources close to the vendor.

Comcast's involvement isn't a complete surpise. The MSO holds stakes in Cedar Point Communications Inc., chip maker Intellon Corp., and other companies that it finds useful for its cable networks. Optical transport gear, such as the kind made by Movaz, is another component that has become increasingly important with the advent of video-on-demand and other high-bandwidth cable services.

Movaz's Series D funding, a round of at least $35 million, closed in November 2003 and has had subsequent closings, with additional investments, since then, the sources say.

It's tough to say how much funding Movaz has raised to date.

The company won't comment on the Comcast backing, and it hasn't announced any funding-related news since May 2002.

According to Light Reading reports, Movaz had raised at least $160 million as of December 2002. With an additional $35 million, Movaz has socked away at least $195 million to date (see Movaz Scores $60M More and Movaz Makes a Splash).

Table 1: ROADM Startup Snapshot

Company Founded Funding Revenues Customers
Tropic Networks May 2000 $120 million Not disclosed. None announced. Reportedly close to a deal with SBC Communications Inc. (NYSE: SBC)
Movaz Networks June 2000 $160 million $36.7 million in 2003 Has 46 customers, including Indiana Fiber Network and South Slope Cooperative Telephone Company
Source: Light Reading and company data


Maybe Movaz doesn't want to comment because prior to 2003, it said it wouldn't need any more money. "We have a fully funded business plan with revenue coming in," Movaz CEO Bijan Khosravi told Light Reading in December 2002. "We don’t need any more cash investment, and we are well on our way to weathering the storm and becoming fully cash-flow positive." (See Movaz: Go Away, We're Fine.)

It's not surprising Khosravi's funding assessment in December 2002 was not the last word. That same month he denied talking to Lucent Technologies Inc. (NYSE: LU) about possible business combinations. "Movaz has had no such discussions with Lucent whatsoever," he said.

Two years later, the two companies announced a detailed agreement that included technology development and some amount of intellectual property sharing in order to enhance Lucent's Metropolis products (see Lucent & Movaz in WDM Deal).

Comcast did not reply to requests for comment.

— Phil Harvey, News Editor, Light Reading


For more on the booming ROADM sector, see the new Light Reading Report: Who Makes What: ROADMs.

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Balet
Balet
12/5/2012 | 1:24:24 AM
re: Sources: Comcast Has Movaz Stake
Based on this article the conclusions are that Bijan Khosravi lies to at least Lightreading team.

My understanding is that it is OK to withhold some sensitive information but it is BAD to lie to anyone, even if it is in the best interests of the company.

I've seen some lying CEOs. It is pathetic.
opticalone
opticalone
12/5/2012 | 1:24:21 AM
re: Sources: Comcast Has Movaz Stake
Comcast Ventures has the stake in Movaz and is based on their own belief that they can make a return on their investment. I don't know of any plans by Comcast Cable to deploy Movaz in its own network.

There a alot of service providers (SBC Ventures and others) that invest cash in start-ups that never buy the companies products for their own use.
Truelight1
Truelight1
12/5/2012 | 1:24:21 AM
re: Sources: Comcast Has Movaz Stake
Does this mean they support a company with a CEO who touches you up.
signmeup
signmeup
12/5/2012 | 1:24:20 AM
re: Sources: Comcast Has Movaz Stake
Nice try but incorrect.

Go to www.comcast.com and search jobs - use movaz as a keyword.

You'll see the following:
6501BR
TitleNetwork Engineer
Position TypeFull Time
CityNew Castle
StateDE
Reports to TitleDirector, PA/DE LMC
Job ResponsibilitiesMajor Duties
-+ Resolve network related issues on Layer 1 through layer 3 networks
-+ Perform troubleshooting of advanced network elements
o I.e. MOVAZ, CMTS, Cisco ONS15454, VOD, Fujitsu, Alcatel, Internet Photonics, Nortel ( Sonet, ATM and Gig-E )

Why would Movaz be listed if it were in fact, not installed in the network?

Next question please.
epeled
epeled
12/5/2012 | 1:24:17 AM
re: Sources: Comcast Has Movaz Stake
Can anyone tell how many shares in % has Alcatel got in Tropic for this $M33 ?
signmeup
signmeup
12/5/2012 | 1:24:17 AM
re: Sources: Comcast Has Movaz Stake
Dude - what is up with your 'check your facts'?

I pointed you to a URL that showed comcast was looking for someone with movaz experience. How can I check my facts when it IS RIGHT THERE IN BLACK AND WHITE ON THE COMCAST WEBSITE!!!!

It is obvious that you have some sort of agenda or vendetta against movaz. I frankly could care less. I don't care about comcast and I certainly don't care about movaz. You said it the article was 'no big deal' and I referred you to a comcast URL that showed obviously someone in side of comcast thinks movaz is important.

Finally, your last post is full of contradictions: you state:
"Comcast Ventures has not taken Movaz through the labs..."
And then you turn right around and state:
"Comcast Cable looked at Movaz in the labs and viewed it as an also ran..."

So which is it? Was movaz in the labs or not?

Next time check YOUR facts.
opticalone
opticalone
12/5/2012 | 1:24:17 AM
re: Sources: Comcast Has Movaz Stake
Check your facts, signmeup.

Movaz is a marginal player in Comcast and will continue to be. Comcast Ventures has not taken Movaz through the labs and is only interested in ROI from other potential sales. Comcast Cable looked at Movaz in the labs and viewed it as an also ran. Look into their revenue contribution during the next Movaz earnings call....

Opticalone
alchemy
alchemy
12/5/2012 | 1:24:09 AM
re: Sources: Comcast Has Movaz Stake
opticalone writes:
Comcast Ventures has the stake in Movaz and is based on their own belief that they can make a return on their investment. I don't know of any plans by Comcast Cable to deploy Movaz in its own network.

Comcast has sprinkled small amounts of VC money with quite a few tech startups over the last few years. Sometimes, I think it's more to keep their core vendors on their toes than anything else. I think the biggest Comcast investment was Syndeo though the amount Comcast kicked in was never published so it might have been co-lead in name only... they co-led a $70-something million round that was pretty much a restart of that particular softswitch company. I heard half of that was used to pay off bridge loans. Comcast later kicked Syndeo out when they failed to deliver. Last I heard, Syndeo had trimmed back from well north of 100 to 30 people and had few prospects.

http://www.syndeocorp.com/comp...

Comcast has a huge Cisco bias and very much has an anti-startup bias once it comes down to shelling out lots of money for mission-critical equipment. Unless a startup has a really compelling advantage over Cisco, they're in for a struggle to get the real dollars. You just can't compete against John Chambers and a Gulfstream V showing up at Comcast HQ to close the deal. Even bigger guys with a long Cable history and quality products like Arris and Motorola/General Instruments struggle head-to-head in Comcast against Cisco.
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