Comcast backs start-up to ramp up Web speeds
NEW YORK (Reuters) - The investment arm of Comcast Corp., the U.S. No. 1 cable operator, said on Friday it will back a Silicon Valley start-up that develops chips to enable super-fast Internet access and more high-definition channels.
Comcast Interactive Capital said it will join U.S. No. 6 cable operator Advance/Newhouse in a $17 million second-round of funding for BroadLogic Network Technologies. Comcast did not say how much it was investing.
BroadLogic already counts Time Warner Inc., Cisco Systems Inc. and Intel Corp. among its earlier corporate investors.
The company makes two main types of chip-sets, the TeraPIX video processor and Wideband Receiver, which recover bandwidth for cable operators and enhance their platforms, according to Comcast.
The chips are now sold mainly within cable modems but there are plans to use them more actively across the cable infrastructure, said Comcast Interactive Capital Managing Director Louis Toth.
"Those two chips can significantly increase the bandwidth on cable plants," said Toth.
Cable operators are racing to ramp up capacity to offer subscribers faster Internet speeds and more high-definition channels as stronger competition looms from satellite television and telephone providers that are building or expanding their own advanced video services.
In May, Comcast Chief Executive Brian Roberts demonstrated Internet speeds of up to 100 megabits per second at The Cable Show. Most major U.S. cable operators today typically offer customers speeds around 5 megabits per second.
Cable companies are limited by the existing capacity of their already-laid cables, partly filled by bandwidth-hungry analog channels.
Most cable operators have been buying or investing in technologies to boost capacity, but they are keen not to make major capital expenditure commitments to avoid unnerving investors.
Comcast has backed other companies who develop technology to help improve network capacity, including a stake in RGB Networks. It had invested in Broadbus Technologies, which was sold to Motorola Inc. in September of 2006.
"We're seeing this need for more services in the future and we're laying the groundwork by investing in companies like BroadLogic," said Toth.
"Then we're having them talk to some of the equipment vendors to come up with a new generation of products to improve the capacity of the network," he added.
