The rumor this week started by Light Reading, which suggest that IPTV middleware specialist Minerva is about to be bought by Nortel may well be true, but it won’t be cut and dried. Minerva may be small, but it has multiple big partners and they may all decide that they want a piece of the action.
Each of Cisco, IBM and Accenture have also acted either as a co-bidder in the past with Minerva, or as an implementer for a system that it has sold. All three see the benefit of leading telco work with an IPTV system that is already interfaced to DRM systems like Latens, Irdeto and Widevine, as well as set tops from Amino and VoD servers from Entone, Kasenna and Bitband.
Cisco is our tip for a counter bid, since it is building its own equipment eco-system around IPTV, with Scientific Atlanta strong in cable and also in IPTV with parts of the AT&T set top deal, and although it doesn’t yet have an encoder maker, it has its own VoD player in Arroyo, as well as being a large shareholder in DRM firm Widevine. These can be made to integrate with any middleware, but the final piece of the jigsaw may be with Cisco buying its own middleware platform. Its choice is really Minerva, cash positive growing fat on local US IOC business, and with a big deal in Canada at Telus, or Israeli Orca, cash fat, but currently shrinking and running slowly out of US partners. Orca had partnered Lucent but then Telefonica offered Lucent the chance to take on board its own Imagenio and also Alcatel went and merged with Lucent.
So our thought is that Minerva doesn’t have to do a deal, so the price will be high, and Nortel could easily be outbid by any of the other three potential bidders. It would be important for Minerva to ensure that it upped the ante by making the others aware that it was in negotiations.
Already the partnership between Microsoft and Alcatel, the marriage of Siemens and Myrio and a more recent agreement that Ericsson would use Kasenna middleware, seems to mean that any telecommunications equipment maker that is serious about IPTV, has already made its move to acquire the core software that drives it.
Minerva told us in the Fall that it now has some 85 commissioned deployments, most of them in the US, and many of them, as yet, very small, but with room to grow into millions of seats.