And so that kind of brings us full circle to one large customer has decided to really pivot almost fully what they’re deploying with us to the DOCSIS 4.0 Version. I think that’s great. It takes advantage of our new technology and really further strengthens our position. In the short-term, as you can see from our guidance as we just discussed with Simon, this does mean we’ve kind of got a little bit funny shape to the curve, a slower first half followed by what we think is going to be a very aggressive second half and — but net-net it doesn’t diminish the total opportunity and it certainly does not put us on the sidelines waiting for any other third-party product or elements of the solution. Is that clear or helpful?
Ryan Koontz: That’s great. One quick follow-up there. Yes, that’s perfect, Patrick, thank you. And with regards to your DOCSIS 4, is any of this second half load — is it more dependent on your customer’s demand or is it your own supply chain holding things up there in terms of the second half weight on broadband?
Patrick Harshman: Specifically regarding DOCSIS 4, it’s more about our customers. I mean, that being said, it’s a good question. I mean, the fact is, we could not ship DOCSIS 4.0 in infinite quantities today even if we wanted to. So frankly, we’re all in a kind of a ramp-up of the supply chain, of the deployment experience, and maturation, et cetera. So everything is converging, but I think if you have to point to something that could be a limiting factor, it’s more on the demand side. We feel quite good about where we are with the technology and that we’re going to be in good shape to supply quite heavy demand in the second half. In fact, as you’ve heard from Walter, that is our plan.
Ryan Koontz: Great. Thank you so much.
Patrick Harshman: Thanks.
Operator: Thank you. Our next question comes from the line of Steven Frankel of Rosenblatt. Please go ahead, Steven.
Steven Frankel: Good afternoon. Patrick, let’s talk about the other set of customers. There were a large number of customers entering SCTE that hadn’t really figured out their deployment plans kind of where are we with those, and how big a percentage of that group is likely in the 4.0 camp, and so they’re going to be back half weighted as well?
Patrick Harshman: Yeah, that’s right, Steve. It’s an excellent question and an excellent point. Look, there is not — certainly domestically, there is not a significant cable operator who is not contemplating DOCSIS 4.0 for at least part of their strategy. And so it’s part of the dialog with everyone and it’s part of the dynamic for better or worse. And again, what we’re talking about here is not the scale of the opportunity, in fact, DOCSIS 4.0 expands the opportunity from our perspective, but it does have certain implications on the timing for all the reasons we’ve just discussed. And indeed, while — I’d say the typical, let’s say, mid-sized operator is still probably has 3.1 more central to their near-term plans, understanding and figuring out their 4.0 strategy, particularly for their most competitive areas is mission-critical for them and it’s very much core to the planning discussions with us and to the anticipated scaling.
Indeed, as you said, pushing things a little bit more back half this year.
Steven Frankel: Okay. And then, on the Fiber business, maybe a little more color on the progress you’re making with new opportunities in the pure fiber area.
Patrick Harshman: Well, I mean, for us it’s all new opportunity, Steve. I mean, as I mentioned, we’ve won quite a bit of business with some significant existing cable accounts, but actually very often within those accounts, it’s a different team. This could be a team dealing with business services, services to MDUs, as well as the groups who are expanding the footprint, the so called edge-out activity acquiring new homes passed. So we’re making good progress there. We’ve had a couple of very significant design wins. Last year was actually quite a good year from a particularly new order input point of view. One of the things we discovered, particularly internationally though is that there was a couple of holes in the product line.
For instance, we focused on 10G initially and there’s a number of accounts that are really also looking for complementary one-gig solution still, legacy solution. So we’ve added some capabilities around that, really I think bullet-proofing our offering and giving us a more complete end-to-end solution for domestic and international operators, and this is looking at both cable as well as new, let’s say, traditional telecom or fiber first operators. And we’re also excited about the progress we’re making there with those new non-cable accounts against several good wins late last year and a pretty strong pipeline, and actually it’s going after those accounts, that’s one of the key areas of focus for us in terms of scaling up our go-to-market capability.
Steven Frankel: And would you remind us how many fiber-first customers you have today?
Patrick Harshman: I don’t think we’ve quoted that and I think that’s not a metric we want to get into, but it’s more than just several. How about that, Steve?
Steven Frankel: Okay, great. Thank you.
Patrick Harshman: Okay, thanks.
Operator: Thank you. Our next question comes from the line of George Notter of Jefferies. Your question, please, George.
George Notter: Hi, guys, thanks very much. Hey, if I go back to last quarter, I think there was a conversation about customers carrying excess inventory, I guess I was thinking about it more in the context of Comcast, but could you give us a sense for what that looks like? Did that inventory get burned off here in Q4 or is that still something that’s kind of lingering going forward?
Walter Jankovic: No, in terms of what we talked about last year, George, in terms of orders that got pushed out, those orders were fulfilled in Q4 that was part of the impact you would see there on inventory, for example, the reduction in inventory. So we were holding inventory that was ready to go a couple of quarters ago and we’ve now flushed that out in Q4.
George Notter: Got it. Okay. And then also what about inventory that is in the possession of your customers. Is there a comment on that as well?
Walter Jankovic: No specific comment, George, in terms of having direct access to see exactly what’s in their pipeline in terms of let it be 3.1 nodes or 4.0 is just getting started. So there’s very little inventory in the pipeline because that’s just getting started now.
George Notter: Got it. Okay. So, is that part of the narrative here that as you see customers transition from 3.1 to 4.0, your business trends are softer now because they’re adjusting inventories or is it in fact that it’s a different skew then that they’re buying as they deploy 4.0 or how do I think about kind of how the customers approaching their own inventories of your products as they go through this transition? Thanks.
