Pace CEO Neil Gaydon has moved to allay fears that the technology company’s £28 million purchase of conditional access firm Latens might be a play to restrict operator choice.
“We don’t for a minute envisage operators moving to soft CA and we will continue to work with our partners. Where we see the opportunity for Latens is its expertise in headends, backend integration into billing systems and things like that, which give us more knowhow”. Gaydon told reporters that in addition to security systems, Latens also had middleware and set-top box monitoring capability that could be used for different customers.
“With conditional access we’re looking at second or third tier operators, like in India where there is something to look at in the changing of analogue to digital cable for the first time. That’s a very tough market to make any money in, and the smart card can be expensive, so soft CA could be right for those customers.” He added that soft CA could also work with second or third tier “It’s a way of reaching emerging markets and some customers that we wouldn’t be able to do.”
Pace today announced increased revenues by 17.4% to £1,330.9 million (€1,545.8m), but news of a 26% growth in the US market was tempered by the revelation that a major US customer had put back a set-top order by a year in order to wait for the next generation of product, a move that sent its previously robust shareprice down by 17% to 182.58 in early afternoon London trading.
“This particular customer said we don’t want the model you’re working on right now, but the generation beyond because we want to accelerate new innovative services and we want that product to be able to do it,” explained Gaydon. “The way we read it is that it speaks to some of the questions being asked of the pay-TV industry as to whether it can innovate fast enough. They’re showing that they can and they’re pulling forward something that we’re working on rather than go through all the launching of a new product and the testing.”
Gaydon said Pace was not shipping the current model to the customer, which was effectively playing catch-up with its peers, and that earnings within Pace remained steady.