Verizon, Technicolor move toward router deal

Broadband access and TV equipment-maker Technicolor has collected signatures on a memorandum of understanding with Verizon that could result in the French company supplying the telco giant with broadband home network routers and gaining a key foothold in the U.S. service provider market.

The vendor, formerly called Thomson prior to a renaming last year, said it is currently building routers to Verizon’s specifications for in-home coaxial cable connections. The routers will be ready in 2011. Meanwhile, Technicolor and Verizon are still working on negotiating what would be a three-year contract, under which Technicolor would collaborate with Verizon on new technologies, in addition to supplying the routers.

Despite recently being called the No. 1 broadband customer premises equipment vendor worldwide in terms of revenue by Infonetics Research, Technicolor has had a bundle of problems the last few years, restructuring amid bad financials. But the Verizon deal, plus the extension of an existing set-top box supply agreement with satellite TV provider DirecTV, suggest potential new revenue opportunities for Technicolor in the U.S., a market in which it usually has relied on reseller partners, such as Falcon/IP Complete.