Morgan Keegan 2006 Equity Conference Memphis, Tennessee
Sept. 8, 2006 Peabody Hotel
Bob Stanzione, Chairman & CEO Jim Bauer, VP-Investor Relations
(www.arrisi.com) Safe Harbor This presentation contains forward-looking statements concerning projections of revenues, income and other financial items; plans and objectives for future operations, products and services; future economic performance; and the assumptions underlying or relating to the foregoing. The statements in this presentation that use such words as ”believe," "expect," "intend," "anticipate," "contemplate," "estimate," or "plan," or similar expressions are also forward-looking statements. Actual results may differ materially from those contained in any forward-looking statement or from those which could be expected to accompany such statements. Specific factors which could cause such material differences include the following: the timing of the introduction and the performance factors of certain new ARRIS products; design or manufacturing defects in our products which could curtail sales and subject us to substantial costs for removal, replacement and reinstallation of such products; manufacturing or product development problems that we do not anticipate; an inability to absorb or adjust our costs in response to lower sales volumes than we anticipate; loss of key management, sales or technical employees; decisions by our larger customers to cancel contracts or orders as they are entitled to do or not to enter into new contracts or orders with us because of dissatisfaction, technological or competitive changes, changes in control or other reasons. Other risks involve capital spending levels by our customers based in part on demand for broadband services, customer adoption of our technologies, the development and marketing of technology by our competitors and the risks associated with potential acquisitions of competitors, additional lines of business and/or product and services offerings. The above listing of factors is representative of the factors which could affect our forward-looking statements and is not intended as an all encompassing list of such factors. We disclaim any obligation to update publicly or otherwise these statements, whether as a result of new information, future events or otherwise.
2 Who we are….
▪ Provider of access solutions for delivery of data, voice and video services over HFC
▪ Largest “pure-play” in VoIP & High Speed Data
▪ Leader in fast growing market segments of Cable Telephony and Converged IP services over cable
▪ Enabler of cable operators’ ability to compete with telcos and satellite and offer “triple-play”
3 Exciting Industry Developments and New Technology Trends Accelerate as Revealed in selected News Headlines during the Month of August…
4 Macro-trends are Driving Cable Equipment Spending Worldwide….
▪ Heated Competition for the Customer! Telcos seek video subs… MSOs seek Telco subs
▪ VoIP in the very Early Stages of Rollout Worldwide
▪ Triple play of data, voice and video pushs bandwidth needs
▪ Internet Traffic driving Data speeds towards +100 Mbps
▪ High Definition TV on Demand is coming
▪ Wireless creates “Quadruple Play” opportunity
5 Worldwide Presence allows ARRIS to Benefit from Industry Macro trends….
Chicago Cork London Denver Boston Beijing Seoul Amsterdam Philadelphia Tokyo Atlanta-HQ Chengdu Barcelona Hong Kong Manila
Santiago
Melbourne AroundAround TheThe World…World… Sales & Admin AroundAround TheThe Clock!Clock! Tech Support
6 Engineering ARRIS Worldwide Customer Base…
Canada United States Asia • Eastlink • Cox • Jupiter – Japan • Capella/Videotron • Comcast • Synclayer – Japan • Rogers • Time Warner • Hanaro - Korea • Charter • Commverge – Korea • Insight • Han Kook – Korea • Adelphia • Chengdu – China • Cable One • Plus 12 Others Latin America • GCI • VTR – Chile • Knology • BCD/Cablevision – • Susquehanna Argentina • Grande Europe • CableMas – Mexico • Bright House • UGC / Europe – Multiple Countries • Liberty – Puerto Rico • Frankfort • Retecal – Spain • Cable Bahamas – • Black Hills • Cabovisao – Portugal Bahamas • Cebridge • Essent – Netherlands • Plus 10 Others • Plus 50 Others • Accesscom – Israel • Telenet – Belgium OverOver 145145 operators,operators, • Laser GmbH – Germany inin 3737 countries,countries, andand growinggrowing…… • Plus 40 Others
7 Why ARRIS?….
▪ Positioned in “Sweet Spot” of Macro-trend CAPEX spending
▪ Rapid new product innovations and introductions
▪ Operational excellence… DSO’s, Turns, Cost Reduction
▪ Strong Balance Sheet… Great Cash Generation
▪ Competition and Bandwidth drives demand for ARRIS products
▪ FY2005 and Q106 results demonstrate Market Leadership and ongoing Business Momentum
8 Financial Results Continue to Improve into 2006 with Strong First Half…. ▪ 6 mos. 2006 Revenues of $428.3M up 43.7% over 6 mos. 2005 ▪ Q206 GAAP EPS* of $0.23 up $0.15 from Q205 GAAP EPS of $0.08 ▪ 6 mos. 2006 GAAP EPS* of $0.42 up $0.30 from GAAP EPS of $0.12 in first 6 months of 2005 ▪ Q306 Guidance - Rev. of $220-$230M – EPS* $0.20-$0.24 GAAP
RevenueRevenue ($M)($M) EPSEPS ($)($) 0.20 - 0.24 250 220 - 230 Est. Est 0.30 0.23 220 0.20 0.19 208 0.18 201 200 0.20 181 162 0.08 0.10 0.04 150 136 128 130 121 112 0.00 -0.01 -0.04 100 -0.06
-0.10
50 -0.20 -0.24
0 -0.30 Q104 Q204 Q304Q404 Q105 Q205Q305 Q405Q106 Q206 Q306 Q104 Q204 Q304 Q404 Q105 Q205 Q305 Q405 Q106 Q206 Q306 *Included in GAAP EPS are amortization of intangibles, equity compensation expense, 9 loss on debt retirement, restructuring and certain other costs. See our website at www.arrisi.com for a reconciliation of non-GAAP measures. Expense Control and Operating Efficiency Creates Operating Leverage… (GAAP)
Operating Expense Revenue Per Employee Annualized
$1,400.00 1600 140.0% $140,000 $1,200.00 1400 120.0% $120,000 Op Ex $ 1200 Op Ex % $1,000.00 100.0% $100,000 1000 $800.00 80.0% $80,000 Revenue Per Emp. 800 $600.00 Headcount 60.0% $60,000
$ in Millions in $ 600 $ in Millions in $ Employee Count Employee $400.00 Percentage of Sales of Percentage 40.0% $40,000 400
20.0% $20,000 $200.00 200
0.0% $- $- 0 2 3 3 3 4 4 4 5 5 5 6 0 0 0 0 0 0 0 0 0 0 2 2 3 0 0 0 0 0 0 0 0 3 4 0 0 0 0 0 004 2 0 0 0 0 5 5 5 2 2 2 2 2 2 200 2 2 2 2 2 2 0 0 004 0 0 2 2 2003 2 0 0 0 2003 2004 2 2 2 Q3 Q4 2002Q1 Q2 Q3 2003Q4 Q1 Q2 Q3 Q4 Q1 Q2 2005Q3 Q4 Q1 2006Q2 Q3 Q4 200 2005 2006 2006 Q1 Q2 Q3 Q4 Q1 Q2 2004Q3 2 Q4 Q1 Q2 Q3 Q4 Q1 Q
Inventory & Inventory Turns Accounts Receivables & Days Sales Outstanding
8.0 $120,000
90.0 $160,000 7.0 $100,000 80.0 $140,000 6.0 70.0 $80,000 $120,000 5.0 60.0 A/R Inventory $100,000 4.0 $60,000 DSO 50.0 Days
Turns Turns $80,000 $ inMillions 3.0 Millions in $ 40.0 $40,000 $60,000 2.0 30.0 $40,000 $20,000 20.0 1.0 10.0 $20,000 - $- - $- 3 3 4 4 5 6 02 05 003 004 004 005 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 20 2 200 2003 2 2 20 2 200 2006 1 200 2 200 4 200 3 200 2002 2002 2003 2003 2003 2003 2004 2004 2004 2004 2005 2005 2005 2005 2006 2006 Q3 2002Q4 Q Q2 Q3 Q4 Q1 Q Q3 Q Q1 2005Q2 Q Q4 Q1 Q2
10 Operating Margin (% & $s) and EPS Increase even as Supplies and CPE become a Larger Part of the Mix… (GAAP)
Operating Margin Earnings Per Share
0.40 $40,000
40.0% $40,000 0.20 $20,000
20.0% $20,000 0.00 $- Op Inc (0.20) $(20,000) 0.0% $- Op Inc % (0.40) $(40,000) Net Income -20.0% $(20,000) (0.60) $(60,000) EPS $ in Cents in $
-40.0% $(40,000) in Millions$ (0.80) $(80,000) Percentage $ in Millions in $ -60.0% $(60,000) (1.00) $(100,000)
-80.0% $(80,000) (1.20) $(120,000) (1.40) $(140,000) -100.0% $(100,000) 05 2 2 3 3 3 3 4 4 4 4 5 5 5 5 6 6 02 04 00 00 00 00 00 00 00 2003 20052005 2 2 2 2 200 200 200 2 2 200 200 200 200 200 200 2 3 3 2 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 4 Q Q4 20Q1 2006Q2 2006 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q3 20Q4 2002Q1 2003Q2 2003Q3 2003Q Q1 20Q2 2004Q3 2004Q4 2004Q1 2005Q
Sales by Product Category Gross Margin
250,000 40.0% $70,000
35.0% $60,000 200,000 30.0% $50,000
150,000 25.0% Broadband Sales $40,000 Gross Margin $ Supplies/CPE Sales 20.0% Gross Margin % $30,000 100,000 $ in Millions in $ Percentage 15.0% Millions in $
$20,000 10.0% 50,000 5.0% $10,000
- 0.0% $-
3 6 0 0 2 2 3 3 3 4 4 4 5 5 5 6 6 0 004 0 006 0 0 0 2 2 00 00 00 2002 2002 2 2003 2003 2004 2004 2004 2005 2005 2005 2005 2 200 200 200 200 200 200 200 3 4 4 1 2 3 4 2 2 4 1 2 3 1 2 2 4 2 Q3 Q4 Q1 Q2 2003Q Q Q1 Q2 Q3 Q Q Q Q3 Q4 Q1 Q2 Q Q Q1 2003Q Q3 20Q Q Q2 2004Q Q4 20Q Q Q3 2005Q Q1 20Q
11 Return on Assets, Return on Equity and Balance Sheet Metrics Continue to Improve…. (GAAP)
Return on Assets & Return on Equity Cash & Short-term Investments Four Quarter Average
30.0% 250,000 20.0%
10.0% 200,000
0.0%
150,000 -10.0% ROA ROE -20.0% 100,000 -30.0% Millions in $
-40.0% 50,000 -50.0%
-60.0% - 6 3 3 5 5 4 6 02 005 005 006 0 0 003 004 004 2 200 2 200 2 002 0 0 2002 20 200 2 200 2 2004 2 2004 200 2 1 3 1 3 4 2 2005 4 2 3 Q Q1 Q 3 2002 4 2 2003 3 2003 2 2004 3 2 1 2005 2 2005 3 1 2006 2 2 Q3 Q Q1 2003Q Q Q4 Q Q2 Q Q4 Q Q2 Q Q Q Q1 2003 Q Q Q4 2003 Q1 2004 Q Q Q4 2004 Q Q Q Q4 2005 Q Q
Debt Cash from Operations
250,000 60,000
50,000 200,000 40,000
150,000 30,000
20,000 100,000 $ in Millions in $ $ in Millions in $ 10,000
- 50,000 (10,000)
- (20,000)
2 3 4 3 3 6 0 0 0 0 0 0 0 0 0 0 0 005 0 2002 2 2003 2003 2 2003 2004 2 2004 2004 2005 2005 2005 2005 2006 2006 2004 2 1 4 3 1 2 4 1 4 2002 1 2 2 2 4 2003 1 2004 2 1 2005 2 1 2006 2 2 Q3 Q4 Q Q2 Q3 Q Q1 Q2 Q Q4 Q Q Q3 Q Q Q2 Q3 2002 Q Q Q Q3 2003 Q Q Q Q3 2004 Q4 2004 Q Q Q3 2005 Q4 2005 Q Q
12 Growth in EMTA and CMTS Shipments Increases Faster than declines in CBR…
HDT Units 2 & 4 Line Voice Ports
400,000 250 350,000
200 300,000
250,000 150 200,000 Units Units
100 150,000
100,000
6 50 6 0 5 5 5 200 20 50,000 5 00 200 2 4 1 Q 200 2 4 Q 4 200 3 Q 4 200 Q 3 1 Q2 0 3 0 00 200 4 Q - 3 Q 3 2 2 Q3 2004 2 200 20 1 Q 2 00 200 4 Q 2 2 3 3 3 Q 0 0 0 0 200 2 2 Q 0 0 0 0 200 1 Q 2 2 2 2 Q 3 Q4 3 2003 4 2003 1 2004 2 2004 3 2004 4 2004 1 2005 2 2005 Q Q3 Q4 Q1 Q2 Q Q Q Q Q Q Q Q Q3 2005 Q4 2005 Q1 2006 Q2 2006
CMTS Downstream Units EMTA Units
6,000 1,200,000
5,000 1,000,000
4,000 800,000
3,000
Units 600,000 Units
2,000 400,000
1,000 200,000
- - 4 5 06 2 3 04 0 04 05 05 0 0 02 03 03 0 20 04 05 20 20 20 2005 20 20 0 0 20 20 20 20 20 2 4 2 2 20 4 3 Q1 2006 Q2 1 2003 2 2003 3 2004 4 2004 3 1 Q2 Q Q4 Q1 Q Q3 Q 1 2006 Q Q4 Q Q2 2003 Q3 Q Q1 2004 Q3 2002 Q4 2002 Q Q Q3 2003 Q4 2003 Q1 2004 Q2 Q Q Q1 2005 Q2 2005 Q3 2005 Q4 Q Q2 2006
13 Earnings Per Share has Increased in Relation to Increase in EMTA units Shipped… (GAAP)
EMTA and Earnings Per Share
800,000 $0.80
300,000 $0.30 EMTA Units EPS Units (200,000) $(0.20) Earnings Per Share Per Earnings
(700,000) $(0.70)
(1,200,000) $(1.20)
4 03 03 0 04 05 06 0 0 2002 20 20 20 2005 20 3 1 1 Q Q4 2002Q1 2003Q2 Q3 2003Q4 2 Q Q2 2004Q3 2004Q4 Q Q2 2005Q3 Q4 2005Q1 2006Q2 2
14 ARRIS Market Share Results . . .
▪ Entered the DOCSIS® CMTS market in 2002 and took share − ~ 0% share 2001 increased to #2 Worldwide position throughout 2005 and #2 in Q206 at ~23% share ▪ Launched VoIP E-MTA in 2003 and gained #1 position − 41% share units Q2 2006…#1 again with over 1 million shipped! ▪ Focus on High Growth Areas allows for More Share of Cable Capex spending
Value,Value, Standards,Standards, ReliabiReliability,lity, SuperiorSuperior ServiceService
Source: Infonetics 15 New ARRIS Product Introductions Reflect Industry Macro-trends...
Network CPE
▪ C4 CMTS 3.0 Wideband ▪ Single Line EMTA − 100 to 1,000+ Mbps per sub − Cable Modem replacement − ARRIS first to demonstrate − ARRIS method now ▪ Multi-line EMTA standard − MDU/Commercial Services − Critical in Asia, Europe, and the U.S. where VDSL and ▪ Wireless Voice/Data FTTH are being deployed Gateway − 802.11g ▪ D5 Next Gen Edge QAM − First element of M-CMTS ▪ Wideband Modem − DOCSIS 3.0 Shared QAM − 100+ Mbps per sub HSD Voice, Data, Video − Switched Digital Video ▪ DS-1/E-1 over Cable − Commercial Services
16 ARRIS CMTS Ports Shipped
Growth80,000 of ARRIS Network Products will Continue as Triple Play Grows...
60,000
40,000
20,000
0 2003 2004 2005 Q1 - Q2 2006 ▪ Over 1,200 C4 CMTS chassis shipped worldwide − More than 50 operators 17 New Services Create More Traffic and Consume More Bandwidth….
Advanced Services Demand More Bandwidth All Video on Demand 100 Unicast per Subscriber High Definition 90 Video on Demand 80 Video Blogs 70 Podcasting Online- 60 Games 50 Video Mail 40 Video on Demand
per Subscriber per 30 Digital Photos
Megabits per Second 20 VoIP Web Digital Music Video Mail 10 Browsing E-Mail 0
18 ARRIS Growth Strategy Provides Plan for New HSD, VoIP and IP-TV Services...
▪ Continue technology leadership − Reliability (Hitless failover and Upgrades) − Carrier Grade VoIP − Highest Density Platform
▪ Deliver market leading features C4 CMTS/M-CMTS − Software upgrade for Wide-Band 100 Mbps − Virtual Private Networks and DS-1 − Switched Digital Video C3 CMTS ▪ Lead in Next Generation M-CMTS − DOCSIS 3.0 Compliance − “All in One” C4/D5 M-CMTS Easy upgrade of existing base Either all-ARRIS or multi-vendor solutions D5 Edge QAM/M-CMTS − Commitment to Converged Services Everything IP, Everywhere…Voice, Data, Video 19 ARRIS FlexPath™ Solution on C4 CMTS Delivers Wideband Now! ▪ What is the FlexPath Solution? − DOCSIS 3.0-based channel bonding software solution for higher bandwidths downstream and upstream ▪ ARRIS FlexPath™ Design Goals − Implement a channel bonding scheme that Addresses primary markets Does not impact overall delivery schedule − Leverages C4® CMTS hardware already deployed Software-only upgrade to launch service ▪ Provides additional speeds MSOs require before DOCSIS® 3.0 products become available and spec finalized ▪ Operators in Japan and Korea now deploying 100+ Mbps service using ARRIS C4 CMTS with FlexPath™
Cost effective solution ready today!
20 Do MSOs need a Next Gen CMTS? ▪ Triple play is moving to converged IPTV, VoIP, and HSD − Requires more bandwidth, security, and IP addresses to facilitate the shift to Everything IP, Everywhere
▪ Flexible bandwidth allocation needed to reduce CAPX/sub − Discrete deployment of Upstream and Downstream capacity allows cost-effective emerging services like IPTV
▪ Competition from DSL and FTTX is driving Wideband data
▪ IPv6 is needed to resolve IP address exhaust for large MSO or interconnected IP networks
Answer:Answer: Yes,Yes, withwith DOCSISDOCSIS 3.03.0 !!
21 Early Stage of Worldwide VoIP Drives CPE Opportunities for ARRIS….
▪ US Cable VoIP penetration at ~5% of homes passed
▪ Comcast forecasts 20% penetration of the 41 million homes that they pass by 2009…. Adding ~23,000 new subs per week
▪ Only ~50% of Comcast operating areas are now being marketed to for VoIP… 100% by next year
▪ Time Warner adding >20,000 new telephony subs/week… 9% overall vs. +23% in Portland
▪ Cox over 30% and growing…
▪ “Adelphia” properties set to go VoIP in 2007….
▪ International VoIP Growth mirrors US VoIP Growth
22 ARRIS Touchstone Telephony leads the Market with Superior Products…
▪ Shipped over 5 million Touchstone Telephony Modems ▪ #1 Market Share 6 consecutive quarters ▪ Major new products in 2006 (Multi-line, Wireless, Wideband)
*Note:23 Top 10 E-MTA customers for 2Q06 Cable CPE CAPEX shows Healthy Growth Potential as VoIP Rolls out…
$3,000
$2,500 Commercial Servcies and MDU Products
$2,000 Wireless Voice/Data Gateway
$1,500 EMTA ($M)
$1,000 Wireless Data only Gateway
$500 Data only Cable Modem
$- 2004 2005 2006 2007 2008 2009 Source: In-Stat 11/05, ARRIS Estimates
▪ 2005: first year of deployments, 2006 – 2008 more operator launches and velocity ▪ Total EMTA revenues increase as unit volumes outpace ASP declines − Profitability maintained through cost reduction and new product introductions ▪ More growth as new services are implemented using DOCSIS-embedded devices − Wireless Gateway, Multi-line EMTA, 100Mbps+ Wideband modem, DS-1 Commercial Service ▪ Top 6 North American MSO subscribers estimated to grow 170% to 5.8 M by YE06
24 New Touchstone® Product introductions allow continuing Revenue and Profitability Growth…
25 In Summary, a Very Positive Outlook in 2006 and Beyond… ▪▪LeaderLeader inin fastfast growinggrowing marketmarket segmentssegments
▪▪RapidRapid newnew productproduct innovationsinnovations
▪▪OperationalOperational excellenceexcellence
▪▪StrongStrong BalanceBalance SheetSheet
LeadingLeading toto continuedcontinued toptop andand bottombottom lineline improvementsimprovementsimprovements….……..
26 Questions Resource Appendix -Customer Premise Equipment (CPE) -Cable Modem Termination System (CMTS) & D5 -Fixed Mobile Convergence (FMC)
(see FBR Growth Conference at www.arrisi.com for Appendix of slides) ARRIS Touchstone Telephony Modem Deployments vs. Inventory Levels are as expected…
Touchstone E-MTAs - All Customers 4,000,000 4.5
3,500,000 4.0
3.5 3,000,000
3.0 2,500,000 2.5 2,000,000 E-MTA UnitsE-MTA 2.0 1,500,000 1.5 Working Inventory (months) Inventory Working 1,000,000 1.0
500,000 0.5
0 0.0
Oct- Nov- Dec- Jan- Feb- Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar-
04 04 04 05 05 05 05 05 05 05 05 05 05 05 05 06 06 06
Cumulative Shipments Cumulative Deployments Net Working Inventory (months) @ 1% monthly Shrinkage/Churn Net Working Inventory (months) @ 3% monthly Shrinkage/Churn
▪ Bottom’s up analysis of shipments vs. deployments ▪ Forward-looking estimate of customer inventory vs. future deployment rate, accounting for product lost due to customer churn and shrinkage ▪ Continued strong customer demand 29 (ARRIS estimates) Current E-MTA Portfolio… Supports both PacketCable and SIP….
Touchstone™ Touchstone™ Touchstone™ Touchstone™ Telephony Modem Telephony Modem Telephony Modem Telephony Modem Platinum Gold Silver Bronze Carrier Grade Carrier Grade Application Voice & Data Voice & Data Voice & Data Voice & Data Capacity 2 RJ11 2 RJ11 2 RJ11 1 RJ11 1 RJ45 1 RJ45 1 RJ45 1 RJ45 1 USB 1 USB 1 USB CableLabs® PC 1.1/DOCSIS® 2.0 PC 1.1/DOCSIS 2.0* PC 1.0/DOCSIS 2.0* PC 1.0/DOCSIS 2.0* Features • Battery Backup 8-16 Hrs Lithium Ion 4 Hrs Lithium Ion Local power only Local power only • Data Interface Bridged 10/100BT & USB Bridged 10/100BT & USB Bridged 10/100BT & USB 10/100BT • Voice CODEC 711, 726, 729 711, 726, 729 711, 726, 729 711, 726, 729 • Specials Battery Telemetry Battery Telemetry
30 *Euro-DOCSIS models also available ARRIS Touchstone® Telephony Tools… Accelerating Time to Market and lowering Cost of Ownership…..
EndEnd-of--of- Dial Pulse T.38T.38 FaxFax CallCall StatsStats Dial Pulse RelayRelay SupportSupport
LoopLoop GainGain DiagnosticsDiagnostics CompensatedCompensated CallerIDCallerID Normal/PowerNormal/Power RingingRinging
HitlessHitless LoopLoop S/WS/W VoltageVoltage UpgradeUpgrade MgmtMgmt
31 The Next Generation ARRIS EMTA…
▪ Replaces the TM402 family ▪ Lower Cost ▪ Based on next gen chipsets ▪ Smaller footprint ▪ Same field proven line card features available in TM402 − 48V supervisory − Constant current boost mode − 5 REN, etc.. ▪ Redesigned battery solution − 2 cell pack – 5 hours − 4 cell pack – 10 hours ▪ Integrated power supply − No power cord brick! ▪ ILEC cross-wiring protection ▪ Available Now TM502 Product Family
32 Multi-Line EMTAs for MDUs and Small Businesses…
TM512A 12-Line EMTA
▪ 8 or 12 line configurations (TM508A and TM512A) ▪ Integrated DOCSIS 2.0 Cable modem ▪ PacketCable and SIP Protocols ▪ Carrier class telephony interface (line diags, current boost mode) ▪ Support for External Battery Backup ▪ Wall mount and rack mount options ▪ RJ45 10/100BaseT Data Interface ▪ Available June 2006
33 Wideband Modem will meet Market Bandwidth Demands….
▪ Standards-based IP Bonded Channels ▪ Downstream data rates − 4 DOCSIS channels − 160 Mbps ▪ Upstream data rates − 4 DOCSIS 2.0 channels WBM650A Wideband Modem − 120 Mbps ▪ Quality of Service ▪ Ethernet 10/100/1000BT ▪ External AC/DC converter ▪ DOCSIS 3.0 compatible ▪ Available July 2006
34 802.11g Wireless Gateway…. Combines Leading EMTA Technology with Wireless to Create an ideal Home Network
▪ CableLabs Compliant ▪ 2 analog POTs lines ▪ 10/100 Base-T 4 Port Ethernet Switch and USB 1.1 interface ▪ Network Address Translation (NAT) and DCHP Server ▪ Wire Equivalent Privacy ▪ VPN Capability ▪ Battery-backup and non- battery versions ▪ Available 3Q06
35 DS-1 Circuit Emulation Modem for Commercial Services… ▪ Based on ARRIS’ industry leading carrier-grade embedded MTA platforms − Ethernet (RJ45) packet data interfaces − T1 TDM data interface − Lithium-ion battery back-up 2.2AH − DOCSIS 2.0 compliant transport ▪ TDM data and packet data both supported from a single, compact, battery-backed CPE ▪ Proven and extremely stable DOCSIS 2.0 cable modem platform with very large deployed base Circuit Emulation ▪ Industry leading battery Service Modem technology
36 ARRIS FlexPath™ Operation Utilizes Existing Cadant® C4® CMTS with Software Update
37 ARRIS D5™
▪ First ARRIS Next Generation Modular CMTS Element
▪ DOCSIS 3.0 QAM Sharing
▪ Converged Voice, Data, Video − MPEG switched digital video − VOD − Multicast IPTV − Unicast IPTV − DOCSIS IP Multimedia content D5 M-CMTS Edge QAM
▪ Integrated with VOD suppliers − Broadbus, C-COR, Concurrent, Kasenna
▪ Industry leading value, density and modularity
▪ Available Now
38 Fixed Mobile Convergence (FMC) presents new “Quadruple Play” opportunity….
Enable subscribers to seamlessly move between cellular networks and local area wireless networks while still receiving the same set of services
39 Network Convergence is coming…
40 FMC Provides Value to all Participants…
41