Terayon's temp

Sat, 07/31/2004 - 8:00pm
Jeff Baumgartner, Editor

Jeff Baumgartner
Jeff Baumgartner
Terayon needs help,
and has enlisted a
DOCSIS pioneer to
revitalize the vendor
and right the ship.
Every now and then there comes a tiny SEC document that carries a lot of weight. In June, Terayon Communication Systems issued a seemingly innocent Form 3 document disclosing that Rouzbeh Yassini had joined the vendor under the arcane title of "Consult/Interim HeadofDataDiv."

After that, the document didn't really note much else of significance, except that Yassini is the proud owner of 1,000 shares of Terayon, worth a tick above $2,000 in mid-July.

But what the document did not say did in fact speak volumes. Terayon needs help, and has enlisted a DOCSIS pioneer to revitalize the vendor and right the ship.

At the behest of some of the vendor's MSO customers, Yassini is on board to help Terayon hire a new CEO, install some other "cable-friendly" management, and protect a vault-full of technical "jewels," which include the company's line of DOCSIS 2.0 CMTS and cable modem gear and a raft of digital video equipment.

Oh, and did I mention that he is expected to accomplish all of this before his contract as a Terayon "temp" expires on Aug. 31?

He'll have plenty of help, of course, but "Rouzbeh loves challenges and loves to work on something as close to impossible as he can," one high-level cable engineer tells me.

Achievable or not, it's also safe to say that Yassini will give this reclamation project as much energy and passion as he can muster. He burns the midnight oil by the gallon. As anyone who knows him can attest to, the only things moving faster than the ideas and visions emerging from Yassini's brain are the thumbs on his Blackberry. And often, both of these things are happening at the same time.

But all the energy in the world doesn't guarantee success. He faces an uphill road paved with a thorny legacy that hasn't always been of the "cable-friendly" variety.

Under Zaki Rakib, the colorful head of Terayon who resigned recently as CEO (because of personal issues) to become chairman, the company was groomed into somewhat of an industry maverick, opting to zig occasionally when the rest of the industry zagged. Sometimes it just wanted to play by its own set of rules. Just try uttering "DOCSIS 1.2" to an old Terayon investor. It just might get you a fat lip.

Terayon's survival–or the survival of its technology, at least–will ensure that cable operators have access to a second source for 2.0 silicon. Or, as Michael Harris of Kinetic Strategies puts it: the continued existence of Terayon will give MSOs "the stick that they can beat Broadcom with." Hey, things are what they are.

However you might see it, the form that survival might take remains a very valid question. Will Terayon find the resolve to go it alone? Will a white knight step in to buy the assets at Terayon still seen as valuable? Whatever the outcome, one thing's for certain: Yassini's actions there over the summer will determine Terayon's fate in the seasons to come.


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