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Falling Star?

Jeff Baumgartner
2/3/2009
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4:30 PM -- No one expected the Motorola Inc. (NYSE: MOT) mother ship or its handset division to report anything short of ugly numbers today, but the revenue shrinkage has extended to the historically solid Home and Networks Mobility unit -- the one that makes digital set-tops, cable modems, and embedded multimedia terminal adapters (E-MTAs). (See Moto Hangs Hopes on Android.)

But the news wasn't all that bad there, as quarterly sales in Home and Networks Mobility came in at $2.6 billion, off 5 percent year-over year. Operating earnings even rose to $257 million, versus $192 million. And the shipments of "digital entertainment devices" (set-tops, et al.) rose as well -- to 4.7 million from 3.4 million units -- fueled by demand for hi-def and HD/DVR combo boxes, and IPTV units.

But Motorola wasn't ready to say whether unit growth is expected to continue in 2009. This year, "overall industry visibility remains limited, with uncertainty in the economy a major factor," Greg Brown, Motorola's co-CEO and CEO of the Broadband Mobility Solutions unit, said on this morning's call.

We should get a better picture bright and early tomorrow morning when Time Warner Cable Inc. (NYSE: TWC) becomes the first major MSO to report fourth-quarter numbers and perhaps relay some '09 capex insight. Readers might recall that the MSO warned that it saw a "significant slowdown" in sub growth as it entered the fourth quarter. On top of that, the MSO noted that it saw a drop in premium video services, including DVR orders, as customers tightened their belts. (See Time Warner Cable Braces for Bad Economy.)

— Jeff Baumgartner, Site Editor, Cable Digital News

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