After Arris acquisition, CommScope realigns business segments

As CommScope heads into 2020, the company is realigning its business into four segments in the wake of its major acquisition of communications and video hardware and software company Arris and enterprise Wi-Fi provider Ruckus Networks.

CommScope completed its $7.4 billion acquisition of Arris (which included Ruckus) in April of this year, which greatly expanded CommScope’s product portfolio. It combined Arris’ position as a major cable industry supplier of customer premise equipment, video and broadband infrastructure and cloud software with CommScope’s fiber and network infrastructure portfolio for wired and wireless networks. Arris also brought Ruckus Networks and ICX Switch, which serve the enterprise network space; Arris had recently acquired those companies from Broadcom.

The realignment reflects just how much the acquisition has broadened CommScope’s business. The company will have new four business segments:

-Home Networks will be the largest of the four segments, based on pro forma revenues of $2.6 billion through September 30 of this year. It will be led by Joe Chow, a veteran of the customer premise equipment segment who joined CommScope in August of this year. This segment “will focus on the future of the connected home and devices inside the home” and it will be “anchored by CommScope’s broadband gateways (coaxial, fiber, and wireless), video set-tops, and in-home devices.

-Broadband Networks will be the second-largest segment by revenue ($2.1 billion pro forma, through Sept. 30). The segment is a new one and combined CommScope’s existing network cable and connectivity business with its network and cloud business. CommScope says it will be positioned as “the leading North American equipment manufacturer with an end-to-end product portfolio serving the telco and cable provider broadband market” and “drive growth in CCAP, PON, Video Systems, Access Technologies, Fiber and Coaxial Cable, Fiber and Copper Connectivity and hardened closures.” The segment will be led by Kevin Keefe, formerly of Arris.

Venue and Campus Networks, which will be led by CommScope veteran Ben Cardwell, will be its third-largest segment by pro forma revenues ($1.6 billion through Sept. 30, 2019). This segment will include Ruckus Networks as well as CommScope’s Enterprise and Distributed Coverage and Capacity (DCCS) businesses: distributed antenna systems, licensed and unlicensed small cells, and Wi-Fi and switching as along with enterprise fiber and copper wired infrastructure. The segment, CommScope noted, “has several product lines that are expected to grow rapidly.”

-Outdoor Wireless Networks is the segment which will focus on macro and metro cells, CommScope said, including base station antennas, microwave antennas, radio frequency filters, tower connectivity, metro cells, cabinets and accessories, as well as Comsearch and its Spectrum Access System. The segment has pro forma revenues of about $1.2 billion as of Sept. 20. It will be led by Farid Firouzbakht, who has been with CommScope for more than 15 years and most recently served as leader of CommScope’s RF products business unit. CommScope said that as wireless operators “shift a portion of their 5G capital expenditures from the macro tower to the metro cell, CommScope’s differentiated offerings and portfolio can support a smooth and cost-effective transition for customers.”

“Since completing the ARRIS acquisition in April, we have created a powerful company with what we believe is the most compelling and diversified global portfolio of industry leading technologies for enterprise and service provider customers,” said CommScope President and CEO Eddie Edwards. “We expect our new operating model will enable us to realize significant benefits of cost and revenue synergies, strengthen our technology leadership, and support our long-term growth strategy.  By bringing similar technology and product platforms together, we will accelerate end-to-end networking systems development, be able to shape the most advanced networks of the future and help our customers unlock the full potential of the coming 5G revolution.”

 

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