BigBand Networks Inc. (Nasdaq: BBND- message board) has laid off a portion of its cable modem termination system (CMTS) staff and reallocated some of those people toward its digital video business, the primary bread winner at the Redwood City, Calif.-based company.

    News of the cuts emerged today in a research note by ThinkEquity Partners analyst Anton Wahlman.

    Multiplesources familiar with the situation at BigBand confirmed the layoffs with Cable Digital News. BigBand officials could not be reached for comment by press time.

    Wahlman did not estimate how many people were let go from the BigBand CMTS team, which is primarily based in the Boston area, but it is believed that as many as 15 people were affected in a decision handed down more than three weeks ago.

    "This should not be surprising, but perhaps still noteworthy because it does call into question the viability of the CMTS business" for BigBand, Wahlman wrote.

    Wahlman believes BigBand has offset any reduction in CMTS with staff increases on the video side, where the bulk of the company's revenues are originating.

    In the second quarter, BigBand posted $46.3 million in product revenues, up from $32.2 million in the year-ago quarter. BigBand attributed the jump primarily to a $14 million increase in revenues from its video products.

    BigBand entered the CMTS business in 2004, when it purchased the IP Cable division of ADC Telecommunications Inc. (Nasdaq: ADCT - message board). Financial terms of the deal were not disclosed at the time, but BigBand valued the acquisition at $25.1 million in an S-1 prospectus it filed late last year. ADC originally acquired those CMTS assets in the fall of 2000 from Broadband Access Systems in a stock deal valued at $2.25 billion at the time.

    Since the ADC deal, BigBand has had limited success building its share in a competitive CMTS sector already dominated by larger companies such as Arris International Inc. (Nasdaq: ARRS - message board), Cisco Systems Inc. (Nasdaq: CSCO - message board), and Motorola Inc. (NYSE: MOT - message board).