Spirent Paves Cable Path to Growth
But it's got a long way to go to get to that stage. Company director of business development and strategy Sean Yarborough acknowledges that the bulk (perhaps up to 90 percent) of Spirent's communications industry business -- which generated revenues of US$198 million in the first six months of 2010 -- is currently generated by telco sector companies (vendors and operators), with about 10 percent coming from cable sector customers.
If the first half of this year is a meaningful guide, that means Spirent is currently generating about $40 million in annual reported sales from cable customers.
The test firm's cable strategy, says Yarborough, comprises network performance probes and handheld testers for engineers. On the network side, it's offering Ethernet probes to monitor business services and mobile backhaul traffic -- areas that are rapidly becoming growth engines for cable.
For in-the-field engineers, it has a handheld test product called Tech-X Flex that helps technicians check the heartbeats of Docsis-based high-speed services and Internet whole-home DVR products that rely on Multimedia over Coax Alliance (MoCA) . (See Spirent Bolsters Cable Testing .)
"Just about anyone who's doing MoCA has started buying [from us]," Yarborough boasts.
But who's buying? Spirent's not divulging names, but does claim to have three of the top five US MSOs on board for testing of devices ranging from residential gateways and embedded multimedia terminal adapters (E-MTAs, also known as voice modems). Its announced customers include Buckeye CableSystem of Ohio, and Ziggo B.V. , the largest cable operator in the Netherlands, with 3.1 million homes passed. (See Ziggo Picks Spirent.)
Further ahead, Spirent believes growth opportunities will open up for its TestCenter Live suite as cable operators start to deliver IPTV over Docsis channels. (See Comcast 'RNG' Set-Tops Have IPTV Potential .)
And that strategy will meet with plenty of resistance, as it comes against a handful of test firms that already have cable strongholds, including JDSU (Nasdaq: JDSU; Toronto: JDU), Cheetah Technologies LP , IneoQuest Technologies Inc. , and Tektronix Inc. , which recently shored up its MSO play by acquiring Mixed Signals. (See Tektronix Snares Mixed Signals.)
But Yarborough points out that Spirent hasn't just decided that cable's worth bothering with, and says the company has been ramping up its cable activities and focus for the past 18 months. "Our goal is to make [cable] 30 percent or more of our business. We believe we can get there in the next two to three years," says a confident Yarborough.
— Jeff Baumgartner, Site Editor, Light Reading Cable