Steven Frankel: And how quickly does this get deployed? Is this something that will be deployed in the back half of this year or do we have the kind of prolonged ramp like we’ve seen with some of the DOCSIS customers?
Walter Jankovic: No, this is second half of the year. Shipments are starting early second half and this is definitely second half.
Steven Frankel: And then maybe just an update on the color of customer conversation at NAB around streaming and the Video business?
Patrick Harshman: Well, Steve, I’ll take this one and I’ll answer it in two ways. First, it felt to us to some extent that the market was back. I mean, candidly speaking, there’s just been a little bit of a slowness to the overall space. And as both Walter and I explained, we still see some of that drag on the traditional client space. The streaming guys and the large media companies were out in force at NAB. Talking about — looking about new content, new ways of packaging that content and our [indiscernible] was jam packed. As I mentioned, our pipeline leading up to and particularly after NAB around significant new SaaS streaming opportunities is substantially larger than it’s been in the last four quarters and stronger than it’s been really since we launched the SaaS offering.
So not exclusively, sports is the bigger piece of that and part of it is supporting new programming, new rights, but another part of it is better monetizing the existing rights. And more than ever before, discussions around new and innovative advertising models, particularly personalized advertising models and as I mentioned this in stream advertising, which is you may have seen in a broadcast scenario at home where there’s a squeeze back et cetera. But that’s all broadcasting, everybody is seeing the same Ford truck advertisement there. Imagine if the squeeze back happens and now something is being served up specifically for you or your neighborhood, that becomes really powerful and it’s something that’s generating a lot of excitement and incremental opportunity that we’re seeing, Steve.
Steven Frankel: And then lastly, just maybe a few more nuggets on Beacon and how material could that be as a revenue contributor to the broadband business?
Nimrod Ben-Natan: First of all, it is a service, so it’s a recurring service. We are not disclosing pricing or anything like that, but this is something that you can think of that scales with the number of nodes or subscribers in the network. We expect — we are in the customer field trial and we expect this to start generating small revenue, but late this year. And over time, we see that kind of the bigger the footprint of our cOS, this is an add-on on top of that.
Steven Frankel: And just lastly, is that targeted at Tier 2 specifically, because Tier 1s can figure out how to do this themselves or do you think even a Tier 1 customer could potentially get benefits from this product?
Nimrod Ben-Natan: I guess your question is on the targeted ads or Beacon, I was not sure…
Steven Frankel: On Beacon, please.
Nimrod Ben-Natan: Beacon can be relevant to any of our customers. It’s not exclusive to only small ones.
Operator: Our next question comes from the line of Ryan Koontz with Needham & Company.
Ryan Koontz: Most of my questions have been answered, but maybe you can expand a little more on this in stream advertising opportunity. You were talking about in terms of the revenue and the deployment model. Where is the whole market in terms of maturity, in terms of being ready for this in stream dynamic ad model? I’d kind of thought that it was already there but maybe I was — misunderstood it.
Patrick Harshman: It’s not already there for this particular kind of advertising avail or availability. Certainly, personalized advertisement exists. But matching up a personalized advertising with not a program break but ongoing live programming is new, Ryan. So in fact, I mean, I spoke earlier about in customer meetings and almost next volume I would say in terms of meetings was with a broader ecosystem. Now we’re of course not an ad matching company et cetera, but we had a number of those folks also through the booth. So it felt very much that at NAB that, not that we’re miles or years away, but the things were just now coalescing combination of the technology we’re enabling on the pipeline together with those who do the ad inventory and matching and together with the people who will meld it all together into services. So yes, it’s pretty exciting and I think we think we’re going to see a lot of progress in the coming couple of quarters and certainly the next year.
Ryan Koontz: And just a quick follow-up on the DOCSIS 4.0 supply chain, you feel ready to meet your customer need, which at this point in terms of the ramp, is it more supply chain limited or customers are kind of phasing in the DOCSIS 4.0 hardware?
Nimrod Ben-Natan: I think the supply chain is not an issue and it’s ramping according to the phasing that we’ve been working with our customer. So it’s on track based on what we predicted previously.
Operator: Our next question comes from the line of Tim Savageaux with Northland Capital Markets.
Tim Savageaux: I’ll offer my congratulations as well to both of you guys, actually. Synchrony got started with this thing. We’re doing about $40 million in legacy revenue and now talking about $480 million. So that’s a pretty amazing accomplishment over that period of time in terms of building the broadband business for both you guys, and look forward to working with Nimrod. And it’s really the diversification of that business that I think is critical. Now that you put away both Comcast and Charter, which again is an amazing achievement. But moving forward, I think Walter made a comment about being pleased with the kind of non top two performance of the business, although, and I’m doing this real time and making a lot of assumptions.
But it seems like that part of your business has been about 35%, 40% of broadband revenue. And that percentage I think was probably up in Q1 but I’m not sure the absolute number was, but I’d be interested in that. If that range is about right and how do you grow that business, whether it’s fiber-to-the-home with other Tier 1s, are there other major global MSOs that could meaningfully shift that balance? And to the extent I’m kind of right there, where would you like to have that number in a year? Well, it might be tough given Charter full ramp, but you know what I’m saying. Where do you want to take it over time?
Walter Jankovic: I’ll kick it off and then Nimrod can add some more color to it. But just in terms of your observations, when I made the comment that we were pleased with the first quarter results, we did see some strong numbers for folks outside of the big two customers. And then also from a forecast perspective in terms of the reviews that we’ve had with Nimrod and the team around the full year and the expectation, and I think you hit the high points, expectation around additional customers that are ramping on from a DOCSIS standpoint but also getting more traction on the fiber-to-the-home type opportunities, both at the telco level but more so in the strategy that Nimrod mentioned earlier around our cable customers and their strategies on focusing in on fiber islands et cetera.
