But recently, a few investors had been calling for the company to exit the set-top business.
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Cisco’s announcement says the Connected Devices Division’s revenue for 2015 will be in the vicinity of $1.8 billion, making it relatively small fry in The Borg’s greater scheme of world domination.
For Technicolor the deal will increase its footprint in the customer premises equipment (CPE) market, granting it around 15% market share worldwide and doubling its revenues to £2.1bn in the connected home segment. Cisco also launched its own consumer telepresence product called umi, which was also a commercial failure.
“Through this acquisition and strategic agreement, Technicolor can immediately bring its unrivalled experience and innovation in video creation, delivery, and display to more customers in more geographies, while strengthening our position as a technology leader”. Cisco was tapped to supply Charter with a “substantial share” of Worldbox units; Humax is Charter’s known second supplier of the device.
The partnership agreement with Technicolor will also ensure Cisco remains close to this business and its service provider customers.
In addition to selling the Linksys home networking business to Belkin in 2013, Cisco sold its set-top box manufacturing facility in Juarez, Mexico, to Foxconn Technology Group in 2011, and revealed in 2013 that it was “walking away” from low-margin set-top deals.
Cisco CTO Hilton Romanski will also join the board of directors at Technicolor once the sale has closed. “The proposed transaction will allow both companies to accelerate our investments in our respective strategic priorities, while working together to deliver value to the market”, said Romanski. Cisco will focus its investments instead on delivering video in the cloud.
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He said Cisco and Technicolor expect to close the deal during Cisco’s fiscal second quarter.
