10 Tech Trends for 2010: #10 Video Infrastructure (CSCO, ERIC, HLIT, ARRS)
Spending on video infrastructure equipment, particularly by U.S. cable companies, did not recover as fully during the second half of 2009 as I had expected. However, with a flood of new Internet and 3D TVs ready to hit the market during the coming months and the satellite industry being past due for an encoder refresh cycle, which usually stirs a response from both cable and telecom, I think we’ll see above average growth in 2010 that catches up for the softness we saw during the last two years.
In the mega-cap area, Cisco (CSCO) and Ericsson (ERIC) are the two big players, with both capable of offering a more or less turn-key solution. However, even at that, Cisco, for example, bundles Harmonic’s (HLIT) universal EDGE QAM in its otherwise all Cisco systems and Ericsson sells a variety of products from its partners. In addition to being a valued partner to the big guns, Harmonic is also the world leader in many areas of what is known as the “video head-end” and a clear leader in the high-value encoding space.
While I think the rising tide will be good for both Cisco and Ericsson, the video infrastructure part of the equation doesn’t move the needle enough to dictate action. However, for the pure-play secondary tier of suppliers, which is led by Arris (ARRS) and Harmonic, what is less than a rounding error for Cisco can make or break a quarter.
In a new special report entitled 10 Tech Trends for 2010, NextInning.com highlights ten technology trends that investors will need to know about this year, as well gives opinions on several key tech stocks, including ones that are its favorites for the new year.
For access to the free report, examining each pick’s business activities, strengths, weaknesses, latest earnings report, and much more, visit NextInning.com.
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