"Motorola told analysts in May it expected shipments of digital set top boxes to grow by 50 percent in 2000 over 1999..."
This statement by Motorola bodes extremely well for our SFA!!! And considering the fact that SFA has the services division and the PowerTv division, I can't see any flaws in her strategy. You're right about not loosing any sleep!
Also mentioned in this article, one potential issue brought up (also pointed out by you?) was the thinking that component shortages (example: flash memory) would prevent expansion of the manufacturing of the set-tops. However from what I am hearing, this 'potential issue' is being resolved by the loosening of supplies. Anybody else hear anything?
Larry, your last post mentioned that Time Warner took 52% of the digital boxes. With the AOL merger, it looks like AOL / TWX are going to push out their interactive TV in mass this year and next. Would you see TWX increasing their orders or have they got enough of the initial deliveries? Any concerns with such a large percentage concentrated in one customer?
Good luck to the longs,
Eric
bigcharts.com
THURSDAY, AUGUST 03, 2000 11:22 AM
- Reuters
08-03 0684 UPDATE 1-Motorola expects cable set top box sales to surge
By Lucas van Grinsven, European technology correspondent
LONDON, Aug 3 (Reuters) - Motorola, the U.S. mobile phone and semiconductor manufacturer, said on Thursday it expected to ship six million television set top boxes this year, adding that market demand in Europe was "crazy".
"We are shipping this year six million set top boxes worldwide," Motorola's president for Europe, Middle East and Africa, Fred Kuznik, told Reuters in an interview.
As cable assets were spun off from incumbent telecom providers, such as those of Deutsche Telekom, new owners of the cable networks were aggressively pushing set top boxes to consumers. The boxes will enable them to deliver higher value media services, such as Internet, telephony and video-on-demand.
"It's a crazy market at this point in time in this region," Kuznik said.
Motorola told analysts in May it expected shipments of digital set top boxes to grow by 50 percent in 2000 over 1999, without giving a specific number.
The company expanded in the set top box business when early this year it finalised the 17 billion dollar acquisition of General Instrument, the U.S. second largest cable box company after Scientific-Atlanta (NYSE:SFA).
MOTOROLA EXPECTS TO SIGN VDSL CONTRACTS IN EUROPE THIS YEAR
Motorola was not just focusing on television set top boxes, Kuznik added. It was also testing delivery in Europe of multimedia services over ordinary copper telephone wires, using a new technology dubbed: very high-speed digital subscriber lines (VDSL).
While he said that this new technology was already sold to 30,000 homes in the U.S., Kuznik expects Europe to catch up this year. Trials in France and Spain and discussions with Deutsche Telekom will lead to real contracts to roll out these services to consumers and small businesses, he said.
"I imagine it could be this year (that we sign) some of the contracts. We're definitely driving that way," he said.
VDSL-technology is a step up from ADSL which is being sold to consumers in the U.S. and several European countries since last year.
ADSL gives consumers broadband access to the Internet, which enables them to surf the web and download graphics and video images. VDSL gives consumers even more bandwidth, that will allow them to receive different television channels alongside Internet access.
"VDSL offers significantly higher bandwidth," said Susan Thompson of market research bureau Dataquest.
But she did not expect that VDSL will make major inroads in the next twelve months, pointing at the lower than expected pick-up of ADSL which consumers regard as too expensive.
"There are a lot of problems in positioning ADSL in terms of pricing," she said. VDSL will become even more expensive. Prices are high because telecom operators are afraid the new services will hurt traditional data services to companies which offer similar bandwidth but at much higher prices.
While the telecom operators will decide how much they will charge consumers for the VDSL service, Motorola will provide home base stations to upgrade the phone network.
SUPPLY PROBLEMS WILL BE SOLVED BY THIRD QUARTER
Kuznik also said that Motorola had solved most of its components supply problems that had haunted his company last year and early next year.
"It looks like the shortages have been resolved by the third quarter," Kuznik said.
"Our suppliers are finally convinced there is that kind of growth (in the mobile phone market)," he said, adding: "They have finally started to invest."
The worldwide market for mobile phones is expected to grow by around 50 percent to 420 million units this year, up from 283 million in 1999, according to market research.
Competitors such as Ericsson (:) and Philips (NYSE:PHG) have not been able to meet market demand because of component shortages, while market leader Nokia (:) of Finland coped with delays in introducing new models.
Rtr 11:22 08-03-00 Copyright 2000, Reuters News Service |
