Horsham's old Jerrold Electronics stands at the brink of change in pay TV

Posted: October 16, 2012

Jerrold Electronics, incorporated in 1948 by Milton Jerrold Shapp, later the governor of Pennsylvania, supplied amplifiers, set-top boxes, and headend equipment to cable-TV companies.

Over the last 15 years, the company's equipment has been at the forefront of some of the most sweeping advances in business: the conversion to digital signals from analog on cable systems, and the introduction of the triple-play bundle of phone, video and Internet.

Now part of Google as Motorola Mobility's Home business, the Horsham company says another inflection point, or big change, is coming in the $150 billion pay-TV industry.

Bob Scheffler, the senior director of strategic technology in the division, calls it the tablet-driven "cloudification" of the TV video business - which means more video delivered over the Internet, multiple screens showing content inside the home, and the intersection of TV and social media. "We have to change with the times, and that means a lot more focus on software and integration," Scheffler said.

Comcast, the nation's largest cable-TV company and a supporter of the "TV Everywhere" concept, is expected to roll out a new TV platform in the Philadelphia area over the next three months that includes traffic, sports and weather apps, and integrates Facebook, Twitter, and Pandora into the TV experience.

Motorola previously was best known to TV consumers for its cable set-top boxes, those ugly boxes beneath or beside the TV. Now it is transforming itself much as Unisys and IBM transformed themselves - with an emphasis on services as opposed to hardware, Motorola officials in Horsham say.

Motorola, Scheffler said, is focusing on optimizing bandwidth and data compression to deliver high-quality video on the Internet, and digital-rights management.

A big fear in the pay-TV business is theft of digital entertainment, a huge issue in the music industry during the Napster era. With more tablets and smartphones accessing content, content providers need to know that only those subscribers who paid for the shows are receiving them, Scheffler said.

Lastly, Scheffler said, set-top boxes are evolving into the "media gateway" into the home that seamlessly integrates the TV, laptop, smartphone, and tablet for video.

Motorola Mobility's Home business is riding this transformative wave during an uncertain time and amid speculation that Google might want to sell the business because it does not fit with Google's strategic direction.

Jeanne Russo, Motorola spokeswoman in Horsham, said the company does not comment on speculation.

Because of interest in patents connected to the Motorola mobile phone business, Google bought Motorola for $12.5 billion in a deal that closed in May.

Motorola's total quarterly revenue was $1.25 billion for the period ended June 30, with the Home division accounting for $407 million of that total, Google reported in July.

In early August, Google announced that it would eliminate 4,000 of 20,000 jobs in the Motorola phone business and close about one-third of its 90 facilities. Google has not disclosed a similar consolidation of the Home division, which is considered profitable.

Motorola's Home division employs about 1,000 in Montgomery County, according to estimates, and also has operations around the globe.

The company intends a new product announcement Monday related to the equipment in cable headends that deliver TV programming to towns and will have a presence at the SCTE Cable-Tec Expo in Orlando on Wednesday through Friday.

"When you are at the beginning of one of these inflection points," Scheffler said, "you don't know how quickly it will come."

Contact Bob Fernandez at 215-854-5897 or bob.fernandez@phillynews.com.

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