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CommScope (COMM) Launches Pre-Integrated Video Solution

CommScope Holding Company, Inc. COMM recently unveiled a bouquet of innovative video services to enable service providers deliver pre-integrated leading streaming applications for superior viewing experiences. Dubbed HomeVista, the solution is likely to accelerate time-to-market and lower development costs for service providers by eliminating the need for customized solutions.

Leveraging open-source software, including AndroidTV and RDK, the HomeVista solution will facilitate the seamless delivery of streaming applications such as Netflix, Prime Video, Disney+, YouTube and other OTT content. RDK enables operators to manage devices, customize their UIs and apps and provides analytics to improve the customer experience and drive business results.

The RDK-based HomeVista solution includes AppCloud, which offers the latest OTT content and applications. Contrary to traditional native app ports that are resource intensive, time-consuming and difficult to maintain, AppCloud runs standard Android OTT apps in the cloud with state-of-the-art virtualization. This enables operators to deliver app-based entertainment promptly and cost-effectively.

CommScope is focused on sound technology and a highly efficient supply chain, and is committed to continuous improvement, making it a preferred partner for all telecommunications businesses as the entire industry moves toward 5G. With operators moving toward converged or multi-use network structures, combining voice, video and data communications into a single network, the company is dedicatedly developing solutions designed to support wireline and wireless network convergence, which will be essential for the success of 5G technology.

The acquisition of ARRIS has better positioned CommScope to capitalize on long-term industry growth trends, including network convergence, fiber and mobility everywhere, the Internet of Things and demand for additional bandwidth, low latency and ultra-high reliability. The combined company has created numerous cross-selling opportunities to expand into adjacent markets, offering potential revenue synergies. The buyout of the patent portfolio from Phluido, a leading provider of high-performance wireless communications, also comes as a boon, especially at a time when operators are gradually shifting from legacy networks to automated networks to address exponential data growth with an optimized infrastructure.

The company has embarked on an initiative dubbed CommScope NEXT — a multi-faceted program to drive future growth that outpaces the market, optimizes business processes and unlocks shareholder value. As part of this strategy, CommScope intends to separate its Home Networks business to create an independent publicly traded entity. Markedly, the tax-free spin-off will enable both CommScope and Home Networks to drive innovation while enabling the latter to focus more on go-to-market strategy and develop its own technologies for home and consumer products on the back of a resilient manufacturing model.

The restructuring will also provide enough flexibility to Home Networks business with a dedicated research & development team that will be responsible for stimulating growth in a “Connected Home” future. Due to the ongoing supply chain adversities, the company has decided to suspend the separation plan and take an appropriate call later, depending on the market conditions.
The stock has lost 12.6% over the past year compared with the industry’s decline of 62.1%.

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We remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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