Profile: Harmonic Inc (HLIT.O)

Harmonic Inc. (Harmonic), incorporated in June 1988, is engaged in designing, manufacturing and selling video products and system solutions that enable service providers to deliver the broadcast and on-demand services, including high-definition television (HDTV), video-on-demand (VOD) and time-shifted television. The Company also provide the video processing solutions to telecommunications companies, broadcasters and Internet companies that offer video services. Harmonic’s products fall into two categories: video processing solutions, and edge and access products. The video processing solutions provide broadband operators to acquire a range of signals from different sources. The edge products enable cable operators to deliver broadcast or narrowcast on-demand and data services to their subscribers. The access products consist of optical transmission products, node platforms and return path products, allow cable operators to deliver video, data and voice services over their distribution networks. In March 2009, the Company completed the acquisition of Scopus Video Networks Ltd.

On July 31, 2007, the Company completed the acquisition of Rhozet Corporation. Rhozet Corporation is engaged in developing and marketing software-based transcoding solutions that facilitate the creation of multi-format video for Internet, mobile and broadcast applications.

Video Stream Processing Products

Harmonic offers the Electra and Ion high performance encoders, which provide compression of video, audio and data channels. Using signal pre-processing, noise reduction and encoding algorithms, these encoders produce video and audio at low data transmission rates. The encoders are available in both moving picture experts group (MPEG)-2 and the MPEG-4 AVC/H264, or MPEG-4, video compression standards. The encoders are used in real-time broadcasting applications, but they are also employed in conjunction with the software in encoding of video content and storage for later delivery as VOD.

The Company offers a range of solutions that enable the customers to combine video streams generated by encoders into a single transport stream at the required data rate. These channel combinations, or pools can be in standard definition, high definition, or a combination of both. A product for these applications is the DiviTrackIP, which enables operators to combine inputs from different physical locations in a single multiplex. DiviTrackIP also improves the bandwidth efficiency of the encoders by allowing bandwidth to be allocated according to the complexity of the video content.

The ProStream platform and other stream processing products offer the customers a range of capabilities, which enable them to manage and organize digital streams in a format suited to their particular delivery requirements and subscriber offerings. The applications include multiplexing, scrambling, re-encoding, rate-shaping, splicing, and ad insertion. The products for these applications include the ProStream 1000, 2000 and 4000.

Harmonic provide the ProView integrated receivers-decoders to allow service providers to acquire content delivered from satellite and terrestrial broadcasters for distribution to their subscribers. These products are available in both standard and high definition formats. The Pro Stream 1000 can also be used as a bulk descrambler to enable operators to deliver up to 128 channels of video and descramble the content at small or remote headends.

Edge and Access Products

The Narrowcast Services Gateway family (NSG) is an integrated edge gateway, which integrates routing, multiplexing and modulation into a single package for the delivery of narrowcast services to subscribers over cable networks. The NSG is supplied with gigabit Ethernet inputs, allowing the cable operator to use bandwidth efficiently by delivering Internet protocol (IP) signals from the headend to the edge of the network for subsequent modulation onto the HFC network. Originally developed for VOD applications, the NSG 9000 may also be used in switched digital video and M-CMTS applications, as well as VOD deployments.

The family of optical transmitters and amplifiers operate at various optical wavelengths and serve both long-haul and local transport applications in the cable distribution network. The PWRLink series provides optical transmission at a headend or hub for local distribution to optical nodes and for narrowcasting, which is the transmission of programming to a select set of subscribers. The METROLink dense wave division multiplexing (DWDM), system allows operators to expand the capacity of a single strand of fiber and also to provide narrowcast services directly from the headend to nodes. The Company has introduced SupraLink, a transmitter, which allows deeper deployment of optical nodes in the network.

The family of PWRBlazer optical nodes supports network architectures, which meet the varying demands for bandwidth delivered to a service area. By the addition of modules providing functions, such as return path transmission and DWDM, the configurable nodes are segmented to handle increasing two-way traffic over a fiber network without reconstruction or replacement of the customers’ networks. The return path transmitters support two-way transmission capabilities by sending video, voice and data signals from the optical node back to the headend. These transmitters are available for either analog or digital transport.

Software Products

The NMX Digital Service Manager gives service providers the ability to control and visually monitor their digital video infrastructure at an aggregate level. The NETWatch management system operates in broadband networks to capture measurement data and the software enables the broadband service operator to monitor and control the hybrid fiber coaxial (HFC) transmission network from a master headend or remote locations. The NMX Digital Service Manager and NETWatch software is designed to be integrated into the network management systems, through the use of simple network management protocol (SNMP).

The MediaPrism software provides operators with a range of integrated content preparation tools to create on-demand content. MediaPrism incorporates a number of Harmonic hardware and software products, including CLEARCut storage encoding and the CarbonCoder software-based transcoding solutions that facilitate the creation of multi-format video for Internet, mobile and broadcast applications. The ProStream 8000 solution allows operators to present on-screen mosaics with several channels tiled within a single video stream. The Armada and Streamliner products enable the intelligent management of an operator’s video-on-demand assets and the distribution of these assets to subscribers. Harmonic is also engaged in providing consulting, implementation and maintenance services to the customers globally.

The Company competes with Motorola, Cisco Systems, Ericsson, Thomson Multimedia and Arris.