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Canadian RoadshowHarmonic/BSE

June 17, 2004

Kurt Schini/Mike Nudi/Pierre Louis Kurt Schini/Mike Nudi/Pierre Louis LandryLandry

kurt.schini@harmonicinc.comkurt.schini@harmonicinc.commike.nudi@harmonicinc.commike.nudi@harmonicinc.com

pierre@bse.on.capierre@bse.on.ca

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Confidential

Who are we? Harmonic Inc.

– Convergent Systems Division (CSD)– Broadband Access Network Division (BAND)

Convergent Systems Core Competencies– Award winning, 7g SD and 2g HD MPEG-2 Encoders– 3g Closed Loop Statistical Multiplexing– Powerful Digital Services Management– Industry Leading Supplier of MPEG-2 Encoding Systems

with over 18,000 sold– Global System Integration and 24x7x365 Customer Support

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Confidential

Harmonic’s World

Strong Compression & Edge QAM Position (55%)

DTH CompressionLeader (31%)

LBR Efficiency + Optical Transport (5%)

Strong Compression Position (9%)

BroadcastTelco

Satellite

Radio tower

Cable

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Market Trend Overview

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Market Trend Brief ATSC

– Final 25% of stations will move this year– Early adopters looking to upgrade– Automation/Dynamic PSIP

Program Distribution– Adding services, higher VQ performance– Dolby E, DPI

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Confidential

In the beginning...

Satellite material

Live Production

Tape andArchived Material

SD/HDProcessing

andPlayback

TransmitterMPEG 2Compressor

SMPTE 292M

SPTE310M

ATSC Broadcast

601 (nX)

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Confidential

Evolving System SolutionsHarmonicDemark

HarmonicDemark

DiviCom

DiviCom

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<Sci entificAtlanta

PowerVuD9228

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

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DSR400SATELLITERECEIVER

GeneralInstrument

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Sci entificAtlanta

PowerVuD9228

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

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DSR400SATELLITERECEIVER

GeneralInstrument

A/D

DiviCom

DiviCom

DiviCom

DiviCom

DiviCom

MV400 HD Encoder - Main

MV400 HD Encoder -Backup (1:1 or 1:N)

MV50 or MV40 SD Encoder 1

MV50 or MV40 SD Encoder 2

MV50 or MV40 SD Encoder 3

MV50 or MV40 SD Encoder 4

A/D

A/D

A/D

A/D

DiviCom

MV50 or MV40 SD EncoderBackup (1:1 or 1:N)

DiviCom

2.1 Mps

NMX

ASISwitch

CONTROLHUB

MUX MN20

Configuration:3 ARM, 1ACM, 1MDM & 1 MOM

Configuration:3 ARM, ACM, 1MDM & 1 MOM

MUX MN20

A/ VMONITOR

DVBASI

Tx Tower

A/V

RO

UTE

R o

r MC

Sw

itche

r

VTR

VTR

8VSB

HD and SDSources

Leitch nx1 SD A/V Switch

Automation

ASIFeed toCable

System

PSIP Generator

DTVTransmitter

STLDS3, SMPTE 310, ASI

Main

ASISMPTE

310

AnalogComp

RS 422

SMPTE292

SDI or Analog

10 Base T

RS 422

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Confidential

Compression Overview

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Solid Foundations

DVxpertII (E4): most widely used M2 compression silicon

4th gen compression engine– Excellent motion estimation– Customized by Harmonic

New silicon evaluated constantly

TM

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MV30 Launched Sept ‘03, FCS Nov ’03 as

economical platform derivative of MV50– Premium feature set CBR replacing MV12

Extends capabilities of previous generation – Motion Compensated Temporal Filtering (MCTF)

for better video originated images– Main board AAA

Advanced options– DPI (SCTE35)– Dolby E – IPA

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MV50 Introduced @ NAB ‘01, FCS June ‘01 as

premium CBR/VBR encoding platform w/Lookahead

Closed loop DiviTrack statistical multiplexing 3x E4 engine platform

– Motion compensated temporal filtering (MCTF)– Advanced Adaptive Noise Reduction– Innovative, evolving filter set

Advanced options include DPI, Dolby E, IPA Still #1 performance in DTH, ATSC, xDSL

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MV 100Launched @ IBC ’03, FCS Dec ‘03 as platform

extension of MV50– Adds advanced analytics (5x DSP) for 9x

processing powerUltimate SD MPEG2 platform

– SW upgradeable to MPEG-4 AVC and WM9 (VC9)Expands development window – allowing more

complex algorithms. – AAC+, WMT audio– Adaptive B-frame

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MV450Launched @ IBC ’03, FCS Dec ’03 as

platform extension of MV400Adds DSP for Lookahead processing

and closed-loop DiviTrackXE communication

New features –4:2:2 sampling ; Dolby-E audio–VANC Closed Caption extraction–Digital Program Insertion (DPI)

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Divicom – A Decade of Leadership 1st 1RU SD Real Time MPEG2 Encoder

1st 1RU HD Real Time MPEG2 Encoder

1st with LookAhead Video Processing

1st with Closed Loop Statistical Multiplexing

1st with Motion Compensated Temporal Filtering

1st to demo AVC & WM9 on same platform

Consistent leader in efficiency, averaging 10% bitrate reduction YoY for last 9 years!

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NMX Digital Service Manager

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Key Features Service rather than HW oriented

– Work’s the way operators do– Input > Output functionality

Easy to learn - template and wizard based Scalable to any size system True client/server architecture Expanded redundancy schemes Growing 3rd party product library Powerful API & triggering interfaces

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ConfidentialFast Network Group CreationFast Network Group Creation

…….and Initial Configuration.and Initial Configuration

Wizards Make System Setup Quick & EasyWizards Make System Setup Quick & Easy

SIMPLE Network Setup

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Network Topology

Make Multiple Changes At OnceMake Multiple Changes At Once

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Network Topology Graphical view of network and devices Multi-level maps Component backplane views Cut, copy, paste replication Template based topologies Online and Offline operation

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Fault Management Alarm configuration

– Priority Standard Perl scripting tools for automatic

email/pager/SMS generation SNMP based Alarm forwarding Consolidated Alarm Viewer GPI contact monitoring Internal Alarm correlation capabilities

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Reports & Statistics

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3rd Party I/F Terayon - DM3200 / DM6400

– Configuration, monitoring Radyne QPSK Modulator 3rd Party platforms supporting GPI contacts 3rd Party platforms using SNMP (NMX 3.0)

– Thales Granite– Seachange Video Server

Switchers/Routers– Leitch, Universal, Pro-Bel, Network Electronics– Others added as required

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Technology Overview

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Leading PQ/bit Performance

Channel Mbps

1

3

2

4

5

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ClearMotion™ Integrated Noise Reduction

DiviTrack - LookAheadStatistical Multiplexing

MPEG siliconDVxpert (E4)

1st integrated MPEG-2 Encoder

MV50

( While maintaining quality )

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

MPEG-4 AVC and WM9 Advanced

Profile New Standards

MV100

MV100 – The platform to extend the trend!

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Stream Processor-DPI

Stream Processor Stream Processor for Digital for Digital Program Insertion Program Insertion

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Digital Program Insertion Insertion of program/commercials into MPEG2

stream – more than a cue-tone replacement Open standards approach

– SCTE 35+– Defines markers in TS to signal splice points– Harmonic is participant in SCTE working group

Enables revenue generating potential Reduces capital equipment costs

– No decoding/re-encoding

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IP Output IPoE quickly becoming ubiquitous topology100BaseT (Fast Ethernet) OutputEnables enhanced solution architectures

– Enables use of off-the-shelf switches– Creates freedom of location for components of

system– Lowers overall solution cost– Improves interoperability with 3rd party equipment– Adds flexibility to solution design

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Next Generation Compression

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MPEG4 AVC/H.264 Most demanded next gen technology Advanced evolution of MPEG-2 techniques Target improvements of ~50% efficiency FCS – VNL; several others in planning stages Expect Q3 delivery on MV100 platform HD AVC late 2005

H.26L H.264/MPEG-4 part 10AVC

JVTISO/IECMPEG

ITU-TVCEG

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Microsoft WM9 (VC9) Utilizes similar tools to AVC Microsoft has initiated standardization

efforts– SMPTE, DVB and ATSC

Substantial support in desk top editing, News, PC targeted apps.

VC9 adds interlace, HD profiles Expect Q1 ’05 FCS on MV100 platform HD VC9 early 2006

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Summary

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Harmonic/BSE: A Complete Solution

Technology Integration Support Training Expertise Partners

Statistical Multiplexing

Interfaces and Packaging

Video analysis (LookAhead)

Video Pre-processing

Noise reduction

Compression

`

Systemization

Integration services & Training

Customer support

Network Management

Conditional Access

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Confidential

Harmonic/BSE Support24 x 7 x 365 Support Standard and Custom Support Plans Plans can include:

– professional telephone assistance, e support, on-site, advanced equipment exchange, ongoing software upgrades, on-site spares.

Customers include

Sinclair, Paxson, Raycom, Fox Sports BellSouth, Qwest, SaskTel, MTS, Softbank, VNL Direct TV, EchoStar, ExpressVu

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Confidential

ATSC Packs-Make it Easy Includes:

– Applicable encoders, multiplexer(s)– NMX Digital Service Manager– Manuals and start up guides– Cables for AAA and MDM components– Rack mount kits – One seat in the operations and training course– One year 24x7x365 service contract

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Thank You!