Cisco’s TV Software Future - Multichannel

Cisco’s TV Software Future

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Meet Jesper Andersen, the new guy running Cisco Systems’ $4 billion cable business.

The Denmark native, who’s lived in the U.S. for the last 17 years, took over as senior vice president and
general manager of Cisco’s Service Provider Video Technology Group last month. He replaced Enrique Rodriguez,
a former Microsoft exec who left Cisco after about a year.

A software engineer by background, Andersen most recently ran Cisco’s network-management tools business.
Before that, he cut his teeth on enterprise applications at Oracle and PeopleSoft. In his first official interview in the new
job, San Jose, Calif.-based Andersen spoke last week with Multichannel News technology editor Todd Spangler.

MCN: What’s your initial assessment of Cisco’s cable
and video-technology portfolio?

Jesper Andersen: I’m still very much drinking from
the fire hose. It’s a very exciting portfolio,
very great breadth. The way the
trend is going in the industry — into the
cloud, the blending of TV and social in
the future — that lends itself very well
to the architecture we’ve laid out with
Videoscape [designed to bring together
traditional TV and Internet content
across multiple devices]. The network
is in the middle to make sure it gets
dispersed out, whether that’s [Internet
protocol]-based or [quadrature amplitude
modulation]-based … I’m very focused,
being new in this job, on working
with customers and understanding
their needs.

MCN: What have you learned talking to
operators the past few weeks?

Andersen: I think it’s obviously wellpublished
what’s going on in the home
around the way entertainment is being
dispersed. The over-the-top plays,
Google’s second attempt at Google TV.
Obviously our cable customers we’re
talking to are plotting their courses
there and acting on how their assets —
the cable infrastructure they have and
their set-top boxes — are best leveraged
in that “N-screen” world. And on everybody’s
mind is agility: How do they do
things faster?

My background is really a software
background, and what’s going on with
the Videoscape architecture and the
cloud world in general, there’s a lot of
software control-plane architecture that
we’re building and acquiring.

MCN: What are your priorities for the
group in 2012?

Andersen: Obviously, we have a very
rich road map with a lot of moving parts,
and a lot of exciting releases — not the
least around the Videoscape platform,
but across the portfolio. We have some
releases on the gateway and hybrid settop
box side.

The service-provider video business is a big business
for Cisco, so delivery to the company in terms of top-line
growth and margin is obviously a primary objective for
me and my team to deliver. There’s room for improvement
on aspects around operations and things like that.
But I’m very happy with the team … I’m just coming in to
help with what I know about software and software platforms
to evolve the portfolio.

We grew [service-provider video revenue] 26% yearover-
year [for the quarter ended Oct. 29], with a yearly run
rate of approximately $4 billion — this is a big, meaningful
business for Cisco. So we’re going to continue to drive that.

MCN: But it’s up because about a year ago, Cisco’s
cable set-top sales tanked. What happened?

Andersen: I won’t speculate back a year, because I
wasn’t in the business. What I’ve seen
in my first six weeks here … is very
strong demand. Whether the world
goes through economic ups and
downs, people want home entertainment.
That’s reflecting well on our customers,
and that means there’s very
good demand for set-top boxes. And
certainly [the] set-top box isn’t everything
in my business, but it’s a big part
and we did well across all segments.

MCN: Some people like to say “the
set-top is dead” — or dying — as IPenabled
TVs, game consoles and other
devices start proliferating. What’s the
outlook for that business?

Andersen: Yeah, I think part of the
reason people speculate around those
things is obviously some of the new
things, Xbox with Kinect or speculation
about Apple TV and over-the-top
— some people tend to think, “Whoa,
with all that press, the set-top must be

That’s not what we’re seeing, and
certainly not what our customers are
projecting. They expect set-tops to be
around for quite a while. I see a place for
gateways and hybrid set-top boxes. If I’m
an operator I can’t put all my eggs in an
Apple TV basket or Xbox basket because
consumers want choice, right? You have
to do a good job of delivering a great service
across all of those.

MCN: [Cisco CEO] John Chambers [on
the company’s Nov. 11 earnings call]
said Cisco got “lucky” with Google’s bid
to acquire Motorola Mobility. Is that really
helping Cisco win business?

Andersen: Well, I certainly think
there are a number of customers out
there that are concerned about what
will Google do, assuming they acquire
Motorola. Obviously, from a Cisco perspective,
we are doing what we can to
sell our value proposition. Whether we benefit and how
much we benefit [from Google’s potential acquisition
of Motorola] certainly we are doing well, as you can see
from our results.

MCN: In the last quarter, Cisco completed the sale of
its set-top manufacturing plant [in Juarez, Mexico] to
Foxconn. How has that transition been?

Andersen: That’s actually been very smooth for us. Certainly
as smooth as we had hoped, if not even better. We
have a great supply-chain team that shields me from
that. It’s a world-class team — not really a ripple in the
ocean I’ve seen.