Arris Leads DOCSIS 3.0 CPE Race - Analyst Blog

By Zacks Equity Research,

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According to a recent report of Dell'Oro Group, Arris Group Inc. ( ARRS ) shipped majority of customer premises equipments ( CPE ) for cable TV industry, which are DOCSIS 3.0 (Wideband) enabled. The DOCSIS 3.0 CPE market is intensely competitive as large broadband gear makers, such as Cisco Systems Inc. ( CSCO ) and Motorola Mobility Holdings Inc. ( MMI ) are major players. Besides, small sized gear makers such as Technicolor S.A. and Ubee Interactive also competes in this market.

Dell'Oro's reports shows 43% of the total CPEs shipped in the third quarter of 2011 were DOCSIS 3.0 enabled. This was an increment of nearly 100% year over year. In the previous quarter, Arris shipped over 1.4 million CPEs. Out of this, nearly 53% devices were DOCSIS 3.0 enabled compared with 36% in the prior-year quarter. Total CPE market value was approximately $333 million in the previous quarter.

Arris has a strong pipeline of CMTS CPE products, including a series of next-generation high-capacity head-end and terminal equipment solutions. The company is also expanding its portfolio of residential products to integrate home networking options for voice, data, and video applications.

Intense competition among cable operators, satellite carriers and telecom service providers for broadband market share has forced the cable MSOs to opt for cost effective bandwidth while boosting the technology for high-speed network. DOCSIS 3.0 is a digital channel bonding technique that creates one larger and faster logical pipe to support throughput of at least 100 Mbit/second.

Cable TV operators are gradually standardizing their respective networks with DOCSIS 3.0 enabled CPEs even if the customer is reluctant to subscribe to wideband network. In U.S., cable TV operators will complete 77% of DOCSIS 3.0 deployment. This positive trend coupled with a decline of DOCSIS 3.0 CPE devices and growing popularity of integrated residential wireless gateways are the main reasons for the significant growth of CPE devices, which support DOCSIS 3.0 technology.

ARRIS GROUP INC ( ARRS ): Free Stock Analysis Report
CISCO SYSTEMS ( CSCO ): Free Stock Analysis Report
MOTOROLA MOBLTY ( MMI ): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: ARRS , CPE , CSCO , MMI

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