Overview / Main Features
The Pace Micro Sky HD box for BSkyB is a private labeled satellite receiver set-top box with dual digital tuners made exclusively for the BSkyB network in the UK and ROI (Republic of Ireland) markets. It is essentially a high-definition DVB based satellite receiver with built in DVR capabilities. The on-board 300GB hard drive is partitioned into 2 segments: a 160GB partition for use as a traditional DVR and a 140GB partition for use to support the BSkyB branded 'Sky Anytime' VOD service. The Sky Anytime service behaves as a pseudo-VOD as it can only periodically download pre-arranged content [usually over night] and serve it as a paid video-on-demand. A built in modem is used to complete the Sky Anytime ordering and billing transactions over traditional phone lines. Despite, carrying an on-board ethernet port, the Pace Sky HD box has limited IP capabilities. Likewise, the available USB and SATA ports are all designed for future expansion and currently do not serve any functions at this time.
European satellite service providers broadcasting on DVB-S standard.
Announcement that Pace will supply BSkyB with Sky HD boxes was released in early August of 2007. The actual shipment of Pace manufactured Sky HD unit to new and existing BSkyB customers likely began in late Q4 2007 or early Q1 2008.
Pricing and Availability
Typically, satellite set-top boxes are heavily subsidized by the service provider as the hardware costs are recouped over the life of subscriber service contract and equipment rental fees, rendering pricing irrelevant. In this case, however, BSkyB's Sky HD business model is structured with the cost of the set top box separate from the service plan. For a month-to-month service plan, BSkyB offers the Sky HD box for a one-time fee of 249 (~$490). We can safely assume that this is a valid reference price for the STB.
The Pace Sky HD box is currently available through BSkyBs Sky HD service. However, since this is a privately labeled device, the end consumer is basically assigned this particular manufacturer dependent on availability and service provider discretion.
Although BSkyB has a sizable overall subscriber base (over 8.5M), the Sky HD service is a relatively new service offering with a current modest subscriber base of roughly 500,000 members 2 years after its introduction. It is anticipated that there will be significant growth in the adoption of HD service by new and existing BSkyB customers. Given that there are 4 manufacturers for this [presumably 1st generation] STB\, we will assume that the sourcing will be spread evenly amongst these 4 manufacturers. The volume estimation for the Pace STB will then be a simple fraction of the terminal subscriber base number for this 1st generation HD STB. Further\, using a linear growth trajectory of 500K subscribers bi-annually on the remaining 1.5 year of product life\, the terminal subscriber base estimation will yield 2M 1st generation Sky HD boxes 1 of which will be Pace Micro.
For the purposes of this teardown analysis\, we have assumed a lifetime production volume of 500K units.
As a reminder\, teardown volume production assumptions are primarily used for our cost analysis in terms of amortized NRE and tooling costs\, especially for custom components specific to the model being analyzed (mechanical components especially). Unless assumed\, volumes increment by an order of magnitude. Minor changes in volume (say 1 million vs. 2) rarely have a large net effect on our final analysis.
Please see xls BOM for detailed cost analysis
What Is Not Included in our Cost Analysis
The total materials and manufacturing costs reported in this analysis reflect ONLY the direct materials cost (from component vendors and assorted EMS providers)\, AND manufacturing with basic test. Not included in this analysis are costs above and beyond the material manufacture of the core device itself\, cost of intellectual property\, royalties and licensing fees (those not already included into the per component price)\, software\, software loading and test\, shipping\, logistics marketing and other channel costs including not only EMS provider and the OEM's margin\, but that of other resellers. Our cost analysis is meant to focus on those costs incurred in the manufacture of the core device and exceptionally in some circumstances the packaging and literature as well.
Country of Origin / Volume Assumptions
Markings indicate that the Pace Micro STB was made in China. Furthermore\, we have assumed that custom mechanicals (plastics\, metals\, etc.) were also sourced in China to take advantage of lower cost structures there.
Country of origin assumptions relate directly to the associated cost of manufacturing\, where calculated by iSuppli. In the cases of finished sub-assemblies (such as the main PCB)\, we do not calculate internal manufacturing costs\, but rather assess the market price of the finished product in which case country of origin assumptions may or may not have a direct effect on pricing.
Remember also that labor rates are applied directly only to hand inserted components and systems in our bill of materials\, and although regional assumptions do\, these new rates do not have a direct effect on our modeled calculations of placement costs for automated SMD assembly lines. Auto-inserted components (such as SMT components) placement costs are calculated by an iSuppli algorithm which allocates a cost per component based on the size and pincount of the device. This calculation is affected by country or region of origin as well.
Like other Sky HD set-top box manufacturers (Thomson\, Amstrad and Samsung)\, the overall design of the Pace set-top box seem to conform to a generic Sky HD reference design. The Sky HD boxes share a common exterior industrial design and user interface with the exception of the layout of connectivity ports in the back panel.
The Pace TDS850NB DVR Set Top has an approximate total component count of 1723 of which 75 are mechanical components. Due to the common form factor of DVR Set Tops\, the components count relates closely to its feature set. The Pace unit is no exception and the component count (both mechanical and electronic) is inline with other similar STBs we have already analyzed.
Component counts have a direct bearing on the overall manufacturing cycle times and costs\, and also can increase or decrease overall yields and re-work. Our calculations of manufacturing costs factor counts and more qualitative complexities in the design. The cost of manufacturing is also\, to some extent\, decreased in this case because of assumed labor rate applied for China.
Note that manual labor has a much smaller effect on auto-insertion assembly lines (for the Main PCB\, for example)\, where manufacturing costs are much more capital equipment intensive and driven by these investment costs.
The core A/V processing chipset is a Broadcom solution which manages the HD video decoding and other I/O functionalities such as the HDMI controller. In the front end\, Pace employs a pair Conexant chips to handle satellite signal modulation and digital tuning. A Seagate 300GB hard drive\, used for DVR and VOD\, is another major component of note in this set-top box.
Overall\, the Pace Sky HD set-top appears to be a typical STB design with front end\, processing and I/O devices.
Here is a summary of the major components used in the Pace Sky HD set-top box design:
Broadcom - BCM7401QKPB1G - A/V Processor / MPEG Decoder
Conexant - CX24117-13Z - Dual Advanced Modulation & DVB-S2 Demodulator & FEC Decoder
Conexant - CX24128-14Z - Digital Satellite Dual Tuner RF IC - ZIF\, Very low Phase Noise\, 3.3V
Samsung - RMUP76855BD - Tuner / RF Modulator
I/O & Interface
Marvell Technology - 88SM4140-LAD1 - SATA-II Host Controller
AKM Semiconductor - AK4708EQ - Audio/Video Switch Matrix (Dual SCART Connectors w/ Two RGB Outputs)
Promos Technologies - V58C2512164SAI5 - SDRAM [DDR\, 512Mb (32M X 16)\, 200MHz\, 2.5V]
Numonyx - NAND01GW3B2BZA6E - Flash (NAND\, 1Gb)
Numonyx - M28W320HST70ZA6 ¡V Flash (NOR\, 32Mb)
Seagate - ST3300820SCE - 300 GB\, 3.5'\, SATA II\, 7200 RPM\, 8 MB Buffer
Power Supply (Internal)