Arris Enhances Product Portfolio

Zacks

Arris Group Inc. (ARRS) – a global technology leader in the development of advanced cable telephony and next-generation high-speed data network – has launched ARRIS SE-7000 encoder. The introduction of SE-7000, a fourth-generation video compression system, will  help content developers to create High Efficiency Video Coding (:HEVC) technology.

The encoder will reduce bandwidth requirements by nearly 50% and will also deliver live HEVC streaming over the MPEG2 TS standard. Additionally, the technology will support both HEVC and Advanced Video Coding (:AVC) streamings, and  IP and baseband SDI inputs.

Increased demand for high resolution video content has resulted in huge bandwidth requirements. Thus, the launch of SE-7000 will facilitate the delivery of more videos at limited bandwidth through wireless, DSL or DOCSIS networks.

Arris recently acquired the cable set-top box business of Motorola Mobility, a subsidiary of Google Inc. (GOOG), for a total consideration of $2.35 billion. The acquisition of will help Arris attain a strong foothold in the video offerings market.

In the second quarter of 2013, Arris’ total revenue was $1,000.4 million, up 186.4% year over year. The Customer Premises Equipments (CPE) segment of Arris generated $663 million of total revenue, up by a whopping 344% over the prior-year quarter. The company stated that 90% of its total CPE shipment was for the DOCSIS 3.0 network.

Comcast Corp. (CMCSA) and Time Warner Cable (TWC) are the largest customers of Arris and have together contributed 43% of Arris’ total revenue. Hence, we believe that by launching such innovative products the company will continue to drive its top-line growth.

Currently, Arris Group Inc. carries a Zacks Rank #3 (Hold).

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