Arris to Retain Motorola Brand, Keep Separate Software Platforms
Arris will use the Motorola brand for set-tops and other networking gear for at least 12 months and maintain separate software platforms in building on its $2.35 billion acquisition of Motorola Home from Google, said Jonathan Ruff, Arris senior director-technology, in an interview last week.
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Arris closed on the purchase in April and has already integrated a large portion of Motorola products and platforms, said Ruff, who joined Arris from Motorola. Among these is Arris’s Moxi, which will serve as a turnkey system for smaller cable operators, while Motorola’s DreamGallery will continue to target larger systems with an open platform that takes a customized approach, he said.
A cloud-based, HTML5-based video tool suite, DreamGallery enables an on-screen guide to be custom-built under an operator’s brand and has been deployed with Shaw Communications in Canada as well as about 20 systems in Europe, Ruff said. It also allows for a consistent user interface across multiple devices, including tablets and smartphones, he said. Arris expects “increased deployments” of DreamGallery “as the year progresses,” Arris CEO Robert Stanzione has said. Moxi, a onetime DVR-based hardware platform that Arris bought in 2009, has found a second home as software that requires little modification and is aimed at systems seeking a “solution that addresses the need for upgrade,” Ruff told us Thursday after speaking at the Second Screen Summit in New York. Moxi has been deployed with about 10 systems in the U.S., he said.
"We now have the breadth of technology, but we need to make sure we are meeting market demand,” Ruff said. Products and platforms introduced going forward had “better be something that is a unique step and that our customers will see value in,” he said. As part of the acquisition, Arris also got access to Motorola Mobility patents from Google, which owns 7.85 percent of the cable hardware supplier as a result of the deal.
Arris will continue supplying video gateways to cable operators, while increasingly moving Motorola toward making thin client set-tops that connect to them, Ruff said. Among Arris’s major customers are Comcast and Time Warner Cable, which accounted for 30 percent and 18 percent of the company’s annual revenue prior to its acquiring Motorola Home, SEC filings have shown. Comcast also owns 7.85 percent of Arris. Motorola’s home business, which includes set-tops, posted a 15-cent-a-share loss on $66 million in revenue for Arris between April 1 and April 15, when the sale closed, said Arris Chief Financial Officer David Potts on a year-end conference call with analysts. The newly-combined company will have a 51 percent share of the market for cable modem termination systems (CMTS) and 45 percent for customer premises equipment, ahead of Cisco at 42 percent and 15 percent, analysts have said. The main overlap between Arris and Motorola Home is in CMTS gear, Ruff said. Arris also will double its patent portfolio to 2,000 and get access to another 20,000 via license with Motorola Mobility, company executives have said. Arris had $1.4 billion in revenue in the year ended Dec. 31, while Motorola Home had $2.4 billion.
In addition to interface software and hardware, Arris also will likely start building its SkyVision advertising software into Motorola products, Ruff said. SkyVision is designed to enable cable operators to run their local advertising business and supports standard definition and HD ad insertion, Arris has said.
"If you take Arris and Motorola’s Home Center, we are really getting the visibility across the entire network going into the consumer’s home,” Ruff said. “The challenge is the video experience on all the devices.”