One year ago, Technicolor acquired the Cisco Connected Device Business, adding a complementary product portfolio to Technicolor’s Connected Home division and expanding its industrial and technological scale around the world, especially in key markets of the Asia-Pacific region. The teams, channels and product lines have now been integrated, creating new opportunities.
The Future Trust recently talked with Georges Laplanche, Head of Connected Home Asia Pacific and China (APAC) at Technicolor. Laplanche shared his thoughts on how the merger has advanced Technicolor’s business in that area and is having a positive impact on enterprises in that region and around the world.
Laplanche: The global scale that the merger has given Technicolor’s Connected Home business certainly resonated in the Asia-Pacific market and delivered a positive image for both new and existing customers. That impact was immediate.
Also, some of Cisco’s Connected Device business was in Korea and Japan, areas we had not been addressing as part of Connected Home. Asia Pacific is a more recent focus, in terms of business, for Connected Home. We have definitely grown in India, Australia and Southeast Asia, and we’ve made some inroads in China. But Japan and Korea were perceived as challenging markets. So definitely, the acquisition of the Cisco Connected Device Business — with this new scale, this new dimension — has helped us in these markets. And today we are successful, gaining traction and serving multiple customers.
Laplanche: Yes, it has. It opened our eyes, and we dared to open the door. Clearly it has had a positive effect on geographical expansion toward Northeast Asia, in South Korea and Japan. That’s definitely the major impact.
The second impact is that we’ve seen our team growing in Asia Pacific — not the business team directly, but the engineering team, with two new sites joining Asia Pacific, one in Shanghai, China, and one in Chennai, India. These are also giving another dimension to Connected Home in Asia. We had been strong in the Indian market, but the fact that we now have an engineering team based in Chennai has been received very positively by customers in that market. Our expansion in China helped with the Chinese market, but it also gave us greater proximity and breadth so we could support our customers in that region even more strongly than before.
Laplanche: First of all, the integration process has been second-to-none. We had quite brilliant colleagues join us in the engineering space, in the project management space, in the operations, in all the functions, and it has been a very smooth integration that left us much stronger. And, we immediately addressed the customers that came along with this acquisition. But even further, we crafted plans to help customers we had not addressed before across the region, including those in Japan and Korea. And today, thanks to that initiative, we have a solid bond there. As an example, we recently signed a distribution agreement with Pioneer in Japan, and this lets us address this fantastic Japanese market. And, an existing partner of Cisco’s in South Korea also welcomed Technicolor as its new vendor without any difficulty, and we are growing the business with them.
Laplanche: I’m sure we’ve captured the best of both worlds. Our new colleagues have brought us some methodologies and developments in some fields that we’ve really appreciated. We’ve also been able to improve our offerings, because of our scale. Connected Home depends on scale of business. Since it’s a volume business, the higher the volume, the better you are able to negotiate, the more credible you are in the market. It has given us a renewed capability in the cable market across the region — and in particular in Japan and Korea — and we have a much stronger offering than we’ve had in the past, without affecting the good job we were already doing in developing that region.
Laplanche: The market is very diverse. It’s a really big region — and it’s not a single market. We go from emerging economies with new markets right up to very sophisticated markets in northeast Asia or Australia, so the diversity of the market is quite important. All types of customers exist in the region. There are telcos, satellite operators, cable operators, and they all need different types of offerings. This acquisition again has given us, in particular in the cable market, a new offering — a new software platform that we can promote in the region. And believe me, that was not the case five years ago. There were a lot of opportunities we were not even aware of, but now, thanks to our size, we can take advantage of them. That doesn’t mean we’ll win every time — it’s a very competitive market! — but we’ll win much more often than in the past.
Laplanche: Once again, the best opportunity I can mention today is Japan. Together, the new team members — those from Technicolor and our new colleagues —have developed set-top boxes for the Japanese market. We’ve secured a partner that gives us a Japanese front to the customers. In December, we started to ship the first set of boxes to Jupiter Telecommunications Co. Ltd., the major cable operator in Japan. This is already a major success that’s partially a consequence of this acquisition. And our business plan for the next three years and the growth we’ve committed to Connected Home and Technicolor management definitely have been made possible by this acquisition. What’s more, North Asia, which represents 60 percent of the addressable market in the region, is now on our radar, which was not the case before.