Motorola to buy BitBand, restates IPTV intentions amid sale rumors

Amid rumors that it may sell the business unit that houses many of its IPTV and video properties, Motorola announced on Monday that it would acquire Israeli video-on-demand content management and delivery company BitBand.

Motorola, according to The Wall Street Journal and other published reports last week, is looking to sell its Home & Networks Mobility unit, which includes many of the company's video assets and long-standing set-top box business, as part of an alleged adjustment to the company's plan to split itself into separate firms. In an interview last week conducted around the topic of TelcoTV 2009 news, Motorola spokespeople didn't have much to say about those reports, but reiterated their commitments to the IPTV and cable TV sectors.

"It is our policy not to comment on rumors and reports, but we remained committed to the set-top box business," a spokeswoman said.

During that interview, in what now seems like a foreshadowing of the BitBand deal, Rob Malnati, director of business development and product marketing for Motorola's Home & Networks Mobility, also raised the topic of content management, saying that it was an area of increasing interest for Motorola. "Asset management and content management--making sure that the right subscribers get the right content--is a real growing area of importance," Malnati said last week. One of Motorola's products addressing that opportunity is the Adaptive Media Management Framework, and early reports on the BitBand deal suggest that BitBand's talents will strongly complement Motorola's existing product.

Malnati also went on to discuss other topics, commenting on the already much-debated future of the STB. Given three possible future directions-that STBs might disappear as their functions are absorbed into TVs, might evolve into residential gateways or remain essential bridges to content and applications-Malnati said all three things could happen. "It really depends on the service provider, because some of them want an extra-thin set-top software client, and some of them want everything to be in the set-top," he said. "Some of them want to have a lot of content and apps in the cloud, and for some of them it will be in the middleware."

Malnati also further commented on announcements Motorola made at TelcoTV 2009, regarding Motorola's OSS/BSS integration with Microsoft's Mediaroom, as well as Motorola's customer engagement with Farmers Telephone Cooperative.

"We are really using our Leapstone assets [Motorola acquired converged service enabler Leapstone Systems in 2007] to further automate a lot of Mediaroom functions." Malnati said, adding that the move was the latest step in an ongoing relationship with Microsoft. "We are seeing a re-emergence of Mediaroom as Microsoft has come up with the packaging so it can be sold into smaller service provider accounts."

The engagement with Farmers Telephone, based in Kingstree, S.C., is one example of how that evolution is hitting home with small telcos. "For Farmers, we are managing the whole Mediaroom process, providing integration and support services as they upgrade [from a previous middleware platform]," Malnati said.

The Microsoft re-packaging of Mediaroom, which included use of server virtualization to reduce the overall cost, has found appeal among the likes of Farmers and SureWest Communications of Roseville, Calif., but Microsoft still may need partners with an affinity for the independent telco market for follow-through on these deployments, and that's where Motorola comes in. "There are hundreds of small independent teclos and cable TV companies out there, and we are well acquainted with them," Malnati said. "In many cases, they have had Tut Systems gear in the network already [Tut, the video encoding firm, was another of Motorola's many video-related acquisitions. That deal came in late 2006.]

A long-time STB supplier, Motorola's acquisitions of such companies as Leapstone, Tut, BroadBus, Netopia and others--with BitBand apparently the latest to be added to its roster--forcefully altered the early IPTV/video vendor landscape. It remains unclear who may be interested in buying the Home & Networks Mobility unit, or how the missions these properties, and the resources devoted to them, could change with a possible sale.

For more:
Reuters has this report on the BitBand deal
The Financial Times has this report of Motorola's sale plans

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Here's Motorola's initial news from TelcoTV 2009
Motorola announced an IPTV storefront through Mediaroom at CES 2009
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