Harris Hopeful About Broadcast Business

Finding new video sales in defense applications

By Glen Dickson -- Broadcasting & Cable, 1/28/2010 11:57:50 AM

Technology conglomerate Harris Corporation reported second-quarter fiscal 2010 income of $140 million, or $1.06 per diluted share, on revenue of $1.22 billion, with its Broadcast Communications division posting a $5 million operating loss on revenue of $117 million.

Harris' overall Q2 income was flat compared to last year, and was driven in part by strong sales of tactical radios from its RF Communications division to the U.S. military. The broadcast business, however, saw a decline, as it had earned $12 million in the second quarter of fiscal Q2 2009 on higher revenues of $163 million.

Compared to the first quarter of fiscal 2010, Q2 revenue in the Broadcast Communications segment was down very slightly, from $119 million. But Q2 orders in the division were significantly higher compared to the first quarter, $139 million compared to $124 million.

Harris chairman, president and CEO Howard Lance pointed to the order growth as an indicator that the broadcast business may be turning around.

"The sequential flattening of revenue and the rebound in orders in this still very tough market environment were both encouraging and are hopefully signs that we are in fact beginning to see a recovery in the global broadcast market," said Lance on the Q2 earnings call. "As the economy improves and advertising revenues begin to improve, we should see some acceleration in capital spending by global broadcast and media networks."

Lance noted that the Broadcast Communications division had won significant orders with 7 Network in Australia, to upgrade six of its 36 channels to high-definition, and with Canada's Olympic Broadcast Media Consortium, to support coverage of the 2010 Winter Olympics in Vancouver later this month. Harris is also continuing to expand into the sports arena business, said Lance, and has won deals from Madison Square Garden in New York and the new Meadowlands stadium in New Jersey.

Harris has also taken core video ingest and asset management technology from its broadcast division and repurposed it for military use with the FAME (Full-Motion Video Asset Management Engine) system, which is used by the U.S. military to capture, store, retrieve and distribute video intelligence information collected from manned and unmanned aircraft and ground-based sensors. Lance said the FAME system has broad applications for Harris' Government Communications Systems customers as well as commercial clients.

"With FAME, we now have an opportunity pipeline totaling $250 million," he said.