Arris Wins Major CCAP Deal - Analyst Blog

Arris Enterprises Inc. ARRS, a leading video and broadband gear manufacturer, has entered into a deal with Germany's major cable operator Unitymedia Gmbh to deploy its Converged Cable Access Platform (CCAP) equipment.

Unitymedia is a wholly owned subsidiary of Liberty Global plc. LBTYA. At present, Unitymedia has 6.6 million video, 2.6 million broadband, and 2.5 fixed-line telephony subscribers covering 12.6 million homes.

In Oct 2012, Arris launched its innovative converged edged router (CER) called E6000. The E6000 router acts as a powerful C4 cable modem termination system (CMTS) of the company while it can be converted into a CCAP ecosystem.

CCAP will help the carriers to maximize bandwidth, simplify the operational structure and evolve according to subscribers' demand. E6000 will also integrate edge QAM legacy video architecture and CMTS DOCSIS IP network of Arris so that cable TV operators get a readymade integrated-IP platform.

In May 2013, Casa Systems was the first company to commercially introduce an integrated CCAP device. The CCAP market is highly competitive with presence of the likes of Cisco Systems Inc. CSCO, Harmonic Inc. and CommScope Inc. Currently, Casa Systems commands approximately 57% of this market while Arris holds a of 38% share.

Therefore, this deal boosts Arris' position in the budding Converged Cable Access Platform (CCAP) equipment market.  Several analysts have estimated that the CCAP market opportunity may reach around $1.7 billion by 2018. Currently, Arris has a Zacks Rank #3 (Hold).

Deployment of E6000 CER will enable Unitymedia to deliver1 Gbps speed to its customers for enhanced broadband data and entertainment services. Arris' CCAP equipment will also allow Unitymedia to expand services in terms of capacity and lower costs.

Meanwhile, in Jun 2013, Comcast Corp. CMCSA, the largest customer of Arris, started the commercial deployment of its E6000 Converged Edged Router. Other cable TV operators, such as Time Warner Cable and Cox Communications are likely to follow the trend soon.