Cisco to be top Cas firm in India with NDS buy

MUMBAI: Cisco will become the largest video and content security solutions provider in India following its $5 billion acquisition of NDS.

The California-based networking giant has been highly active in the Indian market, inking deals with several multi-system operators (MSOs) for providing digital set-top boxes (STBs).

Cisco Capital has also provided vendor financing to some cable TV networks. It has, for instance, supported Fastway Transmissions, which has presence in Punjab, Haryana and Himachal Pradesh, and Gujarat Telelinks Private Ltd (GTPL), a joint venture where Hathway Cable & Datacom has 50 per cent stake, for its digital services in Kolkata.

NDS, the video and content security software company currently owned by News Corp and Permira Advisers LLP, is already a major player in the Indian market. It provides encryption systems integration to big digital distribution companies like Tata Sky, Airtel Digital TV, Hathway Cable & Datacom, Den Networks and Asianet.

"NDS’ service provider footprint will expand Cisco’s video customer base internationally, including in emerging markets, such as in China and India, where video subscriber growth is increasing rapidly. For media companies, this acquisition will strengthen Cisco’s ability to provide them with a platform to directly serve their customers and better align with service providers," Cisco MD, Corporate Strategy, Investments and Acquisitions - Asia Pacific Japan Theatre & WW Services Joydeep Bose told Indiantelevision.com.

Cisco will also have access to NDS‘ R&D centre at Bangalore in India. NDS has invested over $250 million in the country and has 1900 people, with offices in Delhi, Mumbai and Bangalore.

"The merger between NDS and Cisco brings the best of both worlds to the digital-pay TV market. NDS is the leader in the digital broadcasting sector in India, securing and enhancing the TV- watching experience of over 20 million homes in India. We can leverage the resources that Cisco brings to this merger, so that we can both work together to support the digitalisation process in India," NDS senior VP, GM and MD, Asia Pacific Sue Taylor told Indiantelevision.

Added Bose, "In India, NDS is a leading provider to the satellite TV market, which is rapidly growing due to increasing subscriber penetration."

Cisco, with the new acquisition, will be in a position to aggressively push for expansion to smaller cable TV networks in India, something which NDS has not been able to tap due to cost reasons.

"Cisco will become the largest Cas (conditional access system) company in India with the acquisition of NDS. We already have a 10-year association with Cisco for our broadband service," said You Broadband and Cable India MD & CEO EVS Chakravarthy. Cisco also provides Cas solutions to Scod18, You Broadband‘s cable TV outfit in Mumbai.

Cisco agreed Thursday to buy NDS for $5 billion, including $1 billion retention-based incentives and debt as it seeks to expand its video services business. The acquisition will strengthen Cisco‘s position in emerging markets like China, besides India. BSkyB, Canal Plus and DirecTV are also NDS‘ main clients.

"The NDS acquisition is aligned with our video priority and our strategic initiatives - to lead in emerging countries, build software platforms, and drive business and technology architectures. NDS’s video software solutions are complementary to Cisco’s Videoscape platform, and together they will transform how service providers and media companies deliver next generation video experiences," said Bose.

The acquisition will have an impact in the Indian market. "This is in line with Cisco‘s earlier acquisition of Scientific Atlanta to create an end-to-end triple play solution for cable networks in the digital economy. The NDS purchase is in the same direction as it seeks to expand its Videoscape entertainment platform. Cisco boxes will come with NDS embedded Cas," said Chakravarthy.

The acquisition is expected to close during the second half of calendar year 2012, subject to regulatory approvals.

Fastway Transmissions, the cable distribution company with foothold in Punjab, Haryana and Himachal Pradesh, has signed a pact with Cisco to deploy over two million STBs over the next two years.