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Cisco scores in India but Chinese set-top box makers way ahead

Jack Loo | Feb. 26, 2013
Western manufacturers like Cisco are using end-to-end strategies while Asian counterparts are low on prices and margins.

Cisco won significant standard definition (SD) set-top box business in India in the quarter ending 26 January 2013. Cisco shipped 1.3 million boxes worldwide in the fourth quarter compared with 850,000 in the third quarter, with a large portion of the increase coming from India.

The numbers are observed by ABI Research as part of its Set-Top Box Database study. "Cisco has been able to retain attractive margins delivering set-top boxes in India because the engagements are based on end-to-end services. These engagements include Cisco headend equipment (notably, cable modem terminations or CMTS), middleware, and conditional access systems in addition to the set-top boxes," said Sam Rosen, practice director at ABI Research.

Meanwhile, Chinese set-top box manufacturers ChangHong and Jiuzhou surged in unit shipments in the third quarter of 2012; and together grew 66 percent sequentially to nearly five million units from three million in the prior quarter. ChangHong serves primarily the Asian markets, while Jiuzhou has more of a mix of domestic and international business.

"Asian market strength within the set-top box sector is no surprise," said Rosen. "North American and Western European markets are largely flat as Asian markets grow and African markets are expected to open up in the next few years. Western manufacturers are using end-to-end strategies, as shown by Cisco, while Asian manufacturers are operating at lower margins and aiming to compete on price within low-ARPU Asian markets."


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