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Insider Report

news and views on broadcast and professional video/audio sectors, worldwide

w/e April 30, 2010 SCRI International, Inc © 1984 - 2010


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3D @ NAB10 100 Page Report

SCRI and Insight Media are offering a 100 page report -- Cost $695; $495 SCRI clients and/or Insider Report Subscribers. Available in May.Contact for more info.

Q1 shipments of PC graphics increase 44%

Jon Peddie Research (JPR) announced its estimated graphics chip shipments and supplier's market share for Q1'10. The year, 2009 came in above expectations with an 11% year to year growth, an amazing comeback. Q1 of 2010 showed traditional seasonal slowdown with everyone except Nvidia and SiS showing decline.

Q4'09 saw the first shipments of a new category, the Integrated Processor Graphics - IPG. With the advent of new CPUs with integrated or embedded graphics. We will see the rapid decline in deliveries for traditional chip-set graphics or IGPs (integrated graphics processors.)

Sony and IPWireless Launch Joint 4G and Beyond Wireless Initiative

Sony Corporation of America and IPWireless, a leading provider of 3rd Generation Partnership Project (3GPP) technology for new applications and markets, announced that the two companies have signed an agreement to jointly research and develop wireless technologies for 4G and beyond. The two companies will initially focus on enhancing Long Term Evolution (LTE) technology for new applications and services with work beginning immediately.

“The wireless technologies of 4G and beyond hold the promise of opening up a new world of opportunities and possibilities for both mobile operators and consumers”

The research and development activity will be based at IPWireless’ technology center in Chippenham, England and will leverage both companies’ global resources. Sony and IPWireless engineers will work together to develop key new technologies to enhance and expand the potential of LTE and other 3GPP technologies with the goal of contributing these new specifications to the 3GPP standards and beyond. These R&D initiatives will blend Sony’s capabilities for delivering rich user experiences and groundbreaking consumer innovation with IPWireless’ unparalleled expertise in developing 3GPP mobile broadband and broadcast technologies.

3GPP is a collaboration between groups of telecommunications associations and international standards organizations that define key technologies and specify the standards used by mobile network operators and manufacturers for the evolution of GSM-based mobile networks. 3GPP standard releases include technologies such as WCDMA, HSPA, IMB, LTE, and LTE Advanced. At the end of 2009, there were almost half a billion subscriptions for 3GPP technologies making it the leading wireless standard globally.

“The wireless technologies of 4G and beyond hold the promise of opening up a new world of opportunities and possibilities for both mobile operators and consumers,” said Gregg Walker, Senior Vice President, Corporate Development, Sony Corporation of America. “IPWireless’ outstanding reputation for innovation and its significant contributions to the development of 3GPP wireless standards over the past decade make it an ideal partner for developing 4G technologies that will shape the future of tomorrow’s wireless lifestyle.”

Dr. Bill Jones, chief executive officer of IPWireless said, “We are thrilled to be working with an industry leader as distinguished as Sony to foster the creation of innovative 4G wireless solutions and LTE applications. Through this partnership, we believe that IPWireless will be able to greatly enhance the solutions we provide our mobile operator customers today, while developing next-generation services and applications that will continue to bolster our reputation as a leading wireless pioneer.”

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Broadcast Income to Reach $17 Billion

BIA/Kelsey predicts this year will see a 7.5 percent increase for broadcast TV station income over last year. The consulting firm said aggregate income in the sector will likely total $17 billion in 2010, compared with last year’s $15.8 billion.

BIA/Kelsey’s latest Television Market Report says television revenues in 10 states will increase nearly 8 percent or more due to hotly contested political races. Among those states: Arkansas (8.5 percent), Pennsylvania (8.5 percent), Texas (8.48 percent), Ohio (8.48 percent), and Colorado (8.43 percent).

“We feel the industry is taking a positive turn and should now focus squarely on improving its revenues by identifying sources of income from multi-casting, online and mobile,” said Mark Fratrik, Ph.D., vice president of BIA/Kelsey. “Broadcasters should be expanding their businesses into related areas where they'll find their audiences and be able to give advertisers greater reach.”

The broadcast upfronts are expected to generated $8.26 billion, according to estimates from Barclays Capital. The figure is a 20 percent increase over last year, when upfront spending plunged $3.5 billion. The upfront sellout is expected to be 77 percent versus 70 percent last year for ABC, NBC, CBS and Fox.

The rebound of the auto industry was cited as a driver, both of more sales and higher costs per thousand. Wire reports indicated CPMs for this upfront season could rise by a high single-digit percentage.

The Big Four broadcast networks likely will give their upfront presentations next month in New York, selling time in shows for the upcoming fall season.

TV Stations Resume HD News Upgrades

According to a story by Deborah D. McAdams in TVB, TV stations around the country are transitioning local news operations to HD architectures after a relatively quiet year of financial uncertainty. At least six stations either launched HD news in the last two weeks or announced plans to do so.

In Johnson City, Tenn., designated market area No. 93, CBS affiliate WJHL-TV is acquiring the HD gear for the studio, the Bristol Herald Courier reports. The transition is scheduled for completion later this year.

WJHL is a Media General TV station. The broadcast group started transitioning its 18 TV stations to HD on Panasonic P2 camcorders when budgets were scaled back last year. This time a year ago, the group cut 300 jobs and froze the employee pension plan. Broadcast revenues increased 12 percent during the first quarter of this year to $67 million.

Meredith Broadcasting is another Panasonic P2 convert, signing a deal two years ago to take all of its 12 TV stations into HD news production with the gear. The Des Moines, Iowa, media company’s 12 TV stations posted operating profit of $17 million on revenues of $76 million for the last three months of 2009, down 23 and 10 percent respectively. At least half of its stations are now doing local news in HD. ( See “Meredith’s HD Upgrade Two Years Later.”)

KWWL-TV in Cedar Rapids, Iowa, DMA 88, made the transition to HD about two weeks ago, the local Telegraph Herald reports. The NBC affiliate is owned by Quincy Newspapers.

WRC-TV, the NBC O&O in Washington, DMA 9, launched HD news last week, the last of the Big Four in the market to do so.

KEZI-TV, the ABC affiliate serving Eugene, Ore., DMA 119, launched local news in HD yesterday, April 26, at 5 p.m., becoming the first in the market to do so. Oregon Media Central reports that KEZI received the HD equipment previously used by ABC affiliate KOHD, which ceased news production in March. Both stations are owned by Chambers Communications. The company built KOHD as a digital station after paying $8.5 million for the broadcast license in 2006, the OMC report said.

KTVX-TV is the ABC affiliate in Salt Lake City, DMA 31. It launched local news in HD yesterday at 5 p.m. as well. The station does local news at 5, 6 and 10 p.m., as well as a week-day, two-hour morning broadcast that starts at 5 a.m.

KTVX belongs to Newport Television of Kansas City, Mo. The company announced last month its intention to upgrade all 14 of its local TV news operations to HD with JVC ProHD gear.

KBMT-TV, an ABC affiliate serving Beaumont, Texas--DMA 141--is also upgrading on JVC ProHD equipment. London Broadcasting owns KBMT, the second of its stations to be transitioned to local HD news. It’s CBS affiliate, KYTX-TV, in Tyler, Texas, DMA 109, was transitioned last year.

While HD upgrades did slow down last year after a spate leading up to the 2008 Beijing Olympics, transitions didn’t grind to a complete halt. Much of the upgrading appeared to happen in smaller markets like Tyler.

WJCL-TV and WTGS-TV in Savannah, Ga., DMA 96, were also among the handful of stations that were upgraded for HD last year. The pair launched HD news last March, the first stations in the market to do so. WJCL, the ABC affiliate, is owned by New Vision Television, which operates WTGS, the Fox. The newscasts are produced by WJCL.

WCTV-TV, the CBS affiliate in Tallahassee, Fla., DMA 106, launched HD news last August. It was the second station in the market to do so.

Around 200 or so of the nation’s roughly 800 local TV news operations are now produced in high-definition, and the number is once again steadily increasing. JVC announced deals at 2010NAB to upgrade Nexstar and Hearst TV stations, which have 71 between them. They’re in the process of transitioning a total of 23 stations to HD news.

Atlanta-based Gray Television announced plans in January to convert its 36 TV stations on Ross Video platforms for HD news. It’s Nebraska stations--WOW-TV in Omaha, DMA 76, and KOLN/KGIN-TV in Lincoln, DMA 105 are done. Seven more stations are scheduled for upgrades by the end of this year.

Lionsgate Doubles Earnings Expectations

Lionsgate announced that preliminary results for Fiscal 2010, the fiscal year ended March 31, 2010, showed adjusted EBITDA in excess of $115 million. This exceeds by more than 50% the adjusted EBITDA guidance in excess of $75 million that the Company indicated it expected on its last analyst call on February 10, 2010. These results underscore the strengthening financial performance that the Company has been reporting throughout the fiscal year.

The stronger preliminary results are attributable to the Company's television business, record library revenues and higher home entertainment revenues.

"Our preliminary fiscal 2010 financial results show that our strong product pipelines, coupled with the continued recovery of the retail and advertising markets, are helping our home entertainment and television businesses to outperform our previous expectations," said Lionsgate Co-Chairman and Chief Executive Officer Jon Feltheimer. "The continued growth of VOD and other on demand revenue streams has also been a recent catalyst for strong revenue and EBITDA performance. As these trends continue, we are targeting another strong EBITDA performance as well as a return to positive free cash flow in fiscal 2011. We remain on track to achieve the significant free cash flow generation for fiscal 2013 to 2015 of $100 million to $125 million annually (before contributions from TV Guide Network, EPIX and FEARnet) as outlined in our most recent investor presentation."

ABC News Lays Off 22 More People in Final Round of Cuts

The last of the lay-offs at ABC News resulted in 22 people losing their jobs, the Los Angeles Times reports. The number was smaller than expected due to the 300 or so folks who elected to take buy-outs. The news division previously announced that it would cut 350 to 400 employees from its 1,400-person staff in a restructuring.

The final round of cuts came yesterday, the Times said. The network news division shed jobs to cut costs. The newspaper says full-timers have been replaced by freelancers on shows such as “20/20” and “Primetime,” and that ABC now has fewer correspondents around the country. Those that remain are becoming one-person bands, writing, shooting and editing their own stories.

ABC is also closing its bureaus throughout the United States, except for the one in Washington, D.C. The Los Angeles bureau formerly had more than 40 staff members.

Comcast Q3 Up

Comcast Corporation reported results for the quarter ended March 31, 2010. Brian L. Roberts, Chairman and Chief Executive Officer of Comcast Corporation, said, “Our healthy operating and financial results for the first quarter mark a solid start to 2010. First quarter results were driven by robust customer growth, a rebound in advertising, momentum in Business Services and our continued focus on expense and capital management. We've also made significant progress in deploying All-Digital and DOCSIS 3.0, or wideband. These are strategic initiatives that will further enhance our superior products, strengthen our competitive position and build long term value for our shareholders.”

Revenue increased 3.8% in the first quarter of 2010 to $9.2 billion, while Operating Cash Flow increased 3.5% to $3.6 billion. Excluding $14 million of NBC Universal-related transaction costs, Operating Cash Flow grew 3.9%. Operating Income increased 6.8% to $1.9 billion. This growth was due to solid operating results across all segments, partially offset by higher expenses at Corporate and Other.

LIN TV Corp. Q1 Revenue up 23%

LIN TV Corp. reported its first quarter 2010 results.

“As the U.S. economy continues its recovery, advertisers are investing their marketing budgets in TV. Significantly increased demand for TV ad time, coupled with the growth of our digital business, has led to a strong start in 2010.”

Commenting on first quarter 2010 results, the Company’s President and Chief Executive Officer Vincent L. Sadusky said: “As the U.S. economy continues its recovery, advertisers are investing their marketing budgets in TV. Significantly increased demand for TV ad time, coupled with the growth of our digital business, has led to a strong start in 2010.”

Based on current sales order pacings, which reflect an accelerating broadcast advertising recovery, the Company expects that second quarter 2010 net revenues will increase in the range of 20% to 26% (or $16.4 million to $21.4 million), compared to net revenues of $82.5 million for the second quarter of 2009.

SeaChange Sells Ownership Share in Casa Systems

SeaChange International completed the sale of its ownership stake in Casa Systems, Inc. for gross proceeds of $34.1 million. SeaChange expects to generate net after-tax proceeds of $30 million on its investment of $8.9 million in Casa Systems. SeaChange also expects to record a pre-tax gain of $25.2 million in its fiscal first quarter related to the completion of this transaction.

“The sale of SeaChange’s stake in Casa represents one of several strategic actions that the Company is taking to improve its liquidity position and deepen its focus on software. SeaChange and Casa will remain close technology and business partners after the transaction and intend to continue collaborating on future projects.”

SeaChange initially purchased an equity stake in Casa Systems in July 2005 for $8.2 million, paid in cash and the cancellation of promissory notes previously issued to Casa in 2005. In June 2009, SeaChange invested an additional $654,000 in Casa Systems. SeaChange’s sale of its equity interest in Casa was executed as a stock repurchase by Casa.

Commenting on the sale, Bill Styslinger, SeaChange CEO and Chairman, said, “We invested in Casa five years ago to help accelerate the development of cost-effective, marketable solutions that enable IP streaming over cable. IP streaming is essential for SeaChange to deliver advanced IP-based television software applications. Now that IPTV is a reality, it is the right time for us to sell our shares of Casa so we can allocate all of our resources to help grow our core business. It has been a pleasure to work with Casa and to see our mutual vision of DOCSIS 3.0 and IP streaming come to fruition. We look forward to continuing to work together in the future.”

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Harris Corp. Reports Strong Q3

Harris Corporation reported GAAP income from continuing operations for the third quarter of fiscal 2010 of $166 million, or $1.27 per diluted share, compared with $136 million, or $1.02 per diluted share, in the prior-year quarter.

"Earnings in the third quarter increased 25 percent, reflecting continued excellent operating performance in RF Communications and Government Communications Systems," said Howard L. Lance, chairman, president and chief executive officer. "Revenue increased 10 percent for the company, and higher orders across all of our segments should continue to drive double-digit revenue growth in the fourth quarter. Our strategy of investing in new technology and applications to solve our customers' complex, mission-critical, and quickly evolving communications and information technology needs is working. Higher orders, strong backlog and a robust

Apple Buys iPad Supplier & HTC-Microsoft

Apple has purchased Intrinsity, according to WSJ, the maker of chip technology in cellphones and devices like the iPad. Plus, HTC signs a licensing deal with Microsoft, raising the stakes in its patent fight with Apple.

Belden Q1 Up

Belden Inc. reported first quarter 2010 revenue of $400.3 million and operating income of $28.1 million, compared to revenue of $328.5 million and an operating loss of $36.4 million in the first quarter of 2009. Net income during the first quarter of 2010 increased to $11.7 million, or $0.25 per diluted share, up from a net loss of $32.5 million, or ($0.70) per diluted share, in the prior year period.

Adjusted operating income in the first quarter of 2010 was $31.0 million or 7.8 percent of revenue, compared to 5.3 percent a year ago. Adjusted income from continuing operations in the first quarter was $14.0 million or $0.29 per diluted share, compared to $7.3 million or $0.16 per diluted share in the first quarter of 2009. See the attached schedule, Adjusted Operating Results, for a reconciliation of GAAP results to adjusted results.

John Stroup, President and Chief Executive Officer of Belden said, “We are pleased to report a strong first quarter despite continued weakness in non-residential spending and a strengthening U.S. dollar. I am especially pleased to report improved execution of our Market Delivery System and Lean Enterprise initiatives which drove year-over-year revenue growth and margin expansion.”

Arris Releases Mixed REsults

ARRIS Group, Inc. ,a developer of advanced cable telephony, next generation high-speed data, demand driven video solutions, operations software and broadband access equipment, announced preliminary and unaudited financial results for the first quarter 2010.

Revenues in the first quarter 2010 were $266.7 million, up 5.2% as compared to first quarter 2009 revenues of $253.5 million, but down 11.1% as compared to fourth quarter 2009 revenues of $300.0 million.

"The first quarter results and in particular, customer diversification, cause me to continue to be optimistic about full year 2010," said Bob Stanzione, ARRIS Chairman & CEO. "Increasing amounts of data and Internet TV traffic, and the proliferation of Internet ready HD televisions coupled with the industry trends towards converged platforms for voice, data and video, present opportunity and demand for existing and new ARRIS products." During the quarter the Company hosted a well-attended analyst and investor conference at its corporate headquarters in Suwanee, GA. Slides from this conference may be found on the ARRIS website and provide the content from all presentations. Also during the quarter, at the Korean Cable Show, the Company demonstrated its C4 CMTS broadband access capabilities that deliver data speeds in excess of 320 Mb/s downstream and 100 Mb/s upstream.

"We started 2010 as expected, and look forward to increasing business momentum as the year unfolds," said David Potts, ARRIS EVP & CFO. "As a result, we now project that second quarter 2010 revenues for the Company will be in the range of $275 to $295 million, with adjusted net income per diluted share in the range of $0.22 to $0.26 and GAAP net income per diluted share, in the range of $0.14 to $0.18."

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2009-2010 Broadcast Pro Video Marketplace (B/PVM)TM Reports
Click here for Table of Contents

2010-2011 Broadcast Pro Video Marketplace (B/PVM)TM Reports Relased @ NAB

2010-2011 Broadcast Pro Video Marketplace (B/PVM)tm Reports Series was released at NAB10. A total of 25 individual product reports as well as a macro industry overview and micro quantitative data analysis reports are available. Contact for more information.

2010-2011 Broadcast/Pro Video Macro Industry Overview Report:

88 page report of analysis and information on the state-of-the-industry compiled from secondary online research sources including industry news sites, manufacturers sites, as well as SCRI's own weekly online News Briefs and Insider Reports.

2010-2011 Broadcast/Pro Video Micro Quantitative Product Data Report:

30-page report containing quantitative data tables, for all six verical end-user markets, as well as in total, plus a 6 page summary analysis of the quantitative data tables

2010 - 2011 Broadcast/Pro Video Product Reports (25):

Video Camcorders; ;Video Cameras; Camera Mounting Systems; Character Generators; Clip / Still Stores; Composite/Component Encoders; Digital Effects Processors; Graphics & Effects Software; Graphics & Effects Workstations; Master Control Switchers; Non-Linear Editing Systems; Production/Post Switchers; RAID Video Storage; Routing Switchers; Standards / Formats Convertors; TBC's / Frame Synchronizers; Telecine Equipment; Terminal Equipment; Up/Down Converters; Video Compression Encoders; Video Disk Recorders; Video Monitors; Video Servers; Video Test & Measurement; VTRs

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