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Worldwide Broadband CPE Market Results

The worldwide broadband CPE market increased 3 percent to $1.3 billion in 1Q06, despite unit shipments dipping 2 percent to 30.2 million, as service providers and cable operators reached into their inventory for baseline CPE without buying as many new products, according to Infonetics Research.

As service providers continue to bundle voice, data, video, and wireless services in triple and quadruple play offerings to attract new customers and reduce churn among existing customers, annual broadband CPE revenue will show healthy gains through 2009, when it will reach $8.6 billion.

"Voice terminal adapters and EMTAs both had a phenomenal first quarter on the heels of record fourth quarter sales," said Jeff Heynen, directing analyst at Infonetics Research. "Continued strong sales of voice-enabling CPE is further proof of the success North American cable operators are having in signing up new voice subscribers. Telcos and cable operators can now justify the higher cost of more integrated CPE because it allows them to deploy additional revenue-generating services."

1Q06 Highlights:

- Worldwide VTA revenue jumped 110 percent and worldwide EMTA revenue jumped 27 percent from 4Q05.
- 41 percetn of worldwide broadband CPE revenue comes from DSL CPE, 25 percent from cable CPE, 28 percent from broadband routers, and 6 percent from VTAs and IP set top boxes.
- High growth is expected for VDSLs and broadband gateways, particularly in 2006
- The number of worldwide DSL subscribers is expected to reach 245 million in 2009, cable broadband subscribers will close in on 70 million, and IPTV subscribers will surge to over 53 million.
- Linksys is the overall broadband CPE market leader, Motorola is second for revenue, D-Link is second for unit shipments.
- 37 percent of total broadband modem, router, and gateway revenue comes from North America, 30 percent from EMEA, 27 percent from Asia Pacific, and 6 percent from CALA.

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