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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
      Form 10-K
      þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year Ended
    December 31,
    2009oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Transition Period
    from          to   Commission File Number:
    001-33355
      BigBand Networks,
    Inc.
 (Exact name of registrant as
    specified in its charter)
      Delaware

04-3444278(State or other
    jurisdiction

(I.R.S. Employerof incorporation or
    organization)

Identification
    Number)   475 Broadway Street
    Redwood City, California 94063
 (Address of principal executive
    offices and zip code)
 (650) 995-5000
 (Registrants telephone number, including area code)
      Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $0.001 par value

The NASDAQ Global Market   Securities registered pursuant to Section 12(g) of the
    Act:
 None.
      o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. o
  12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ
    DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K.




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##### 





BigBand
    Networks, Inc.FORM 10-K
    for the fiscal year ended December 31, 2009
    TABLE OF CONTENTS
   
 PageSpecial Note Regarding Forward-Looking
    Statements


3PART I.Item 1.


Business


4Item 1A.


Risk Factors


16Item 1B.


Unresolved Staff Comments


29Item 2.


Properties


29Item 3.


Legal Proceedings


29Item 4.


Submission of Matters to a Vote of Security
    Holders


29PART II.Item 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


29Item 6.


Selected Financial Data


30Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


32Item 7A.


Quantitative and Qualitative Disclosures about
    Market Risk


45Item 8.


Financial Statements and Supplementary Data


47Item 9.


Changes In and Disagreements With Accountants on
    Accounting and Financial Disclosures


81Item 9A.


Controls and Procedures


81Item 9B.


Other Information


83PART III.Item 10.


Directors, Executive Officers and Corporate
    Governance


86Item 11.


Executive Compensation


86Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


86Item 13.


Certain Relationships and Related Transactions,
    and Director Independence


87Item 14.


Principal Accountant Fees and Services


87PART IV.Item 15.


Exhibits, Financial Statement Schedules


87Signatures


90EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1   2




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SPECIAL
    NOTE REGARDING FORWARD-LOOKING STATEMENTS
  Form 10-K (Form 10-K) Form 10-K, Form 10-K. Form 10-K
  Form 10-K
  Form 10-K
  Form 10-K
  Form 10-K Form 10-K
 3




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##### Table of Contents



PART I Item 1.
    BUSINESS  Overview
    Industry
    Background
    Consumer
    Demands
    
    Personalization.  With the proliferation in
    content, consumers are seeking content that is increasingly
    customized to their personal interests. This personalized
    content spans everything from the purchase of downloadable
    episodes of television programming to customized video
    programming, such as Video on Demand (VOD) and niche channel
    packages.
    Richer Video Content.  Consumers are demanding
    a higher quality experience, whether online or in their
    television viewing. As a result, consumers are continuing to
    purchase HDTVs and high-speed data services to access richer
    content, such as HD programming, user-generated video clips and
    interactive online video games. For example, Forrester Research
    estimates that 57% of all U.S. households will have HD
    televisions by the end of 2010.
    Ease and Speed of Access.  In an increasingly
    mobile world, consumers desire faster access to content from
    virtually anywhere using a wide range of devices, such as
    portable media players, televisions, mobile phones, personal
    digital assistants and personal computers.   4




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Advertiser
    Demands
    
    Relevancy.  Advertisers are demanding that
    their advertisements be addressed to a relevant audience. For
    example, they desire to target video advertising to particular
    geographic zones, and ultimately want to tailor advertising to
    specific subscribers.
    Interactivity.  Advertisers want to provide
    consumers with an easy and immediate way to respond to an
    advertisement. For example, advertisers would like to provide
    subscribers with the ability to use a remote control to
    immediately access additional product information associated
    with a television advertisement.
    Measurability.  Advertisers are seeking ad
    distribution networks that allow them to measure the
    effectiveness of their ad spending and are willing to pay more
    for video advertisements that result in a higher consumer
    response rate.    Intelligent,
    High-Bandwidth Video Networks are Needed
      
    Bandwidth Limitations Posed by Video.  Service
    providers fixed-bandwidth networks are not fully equipped
    for the volume and richness of content being demanded by
    subscribers. For example, a typical HDTV video stream requires
    19.4 megabits per second (Mbps) of continuous bandwidth, which
    is up to ten times the bandwidth required by a standard
    definition video stream and substantially greater than the
    10 Mbps limit of most copper-based network data
    connections. To meet the demand for more and richer content such
    as HDTV, service providers must either undertake a costly
    capital expansion of their network infrastructures or use their
    existing infrastructure more efficiently.
    Difficulty of Delivering a High-Quality Video Experience.
    Service provider networks are inherently prone to packet loss,
    error and delay. This problem is exacerbated as the richness and
    volume of the content being delivered across the network
    increases. Importantly, HDTV is approximately 1,000 times more
    sensitive to packet loss, error and delay than voice and data
    services. To ensure a consistent high-quality subscriber viewing
    experience, service providers must find solutions that maintain
    the integrity of the video streams as these streams are
    delivered across their networks. 5




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
    Lack of Customized Video Programming.  Existing
    networks lack the intelligence to allow service providers to
    understand and react to subscriber television viewing behavior.
    As a result, service providers lack the ability to deliver video
    programming packages tailored to the interests of specific
    subscribers or groups of subscribers. To deliver customized
    video programming, service providers require networks that will
    enable them to understand subscriber viewing behavior and, based
    on that understanding, allow them to deliver new video channels
    and programming packages to specific subscribers or groups of
    subscribers.
    Requirement for More Relevant Video
    Advertising.  Advertisers are demanding that their
    advertisements be addressed to a relevant audience. To satisfy
    this demand, service providers need the capability to deliver
    video advertising to particular geographic segments and
    demographic groups, and ultimately, to tailor advertising to
    specific subscribers. In most broadcast implementations, service
    providers lack the capability to distinguish one subscriber from
    another and the capacity to insert tailored advertising into a
    continuous video stream without degrading service quality.
    Service providers are seeking solutions that will enable the
    seamless insertion of relevant advertisements into video streams.
    High Cost of Infrastructure
    Investment.  Service providers have invested
    heavily to establish their existing network infrastructures,
    including the deployment of a significant number of cable
    set-top boxes. Service providers must either make significant
    investments to upgrade or replace their existing infrastructure,
    or find ways to extend the useful life of their installed
    equipment. Service providers generally prefer network-based
    capital investments since these costs can be allocated across
    many subscribers without costly replacement of existing set-top
    boxes.
    Need to Rapidly Deliver Advanced
    Services.  Historically, service providers have
    needed to make very large capital expenditures to purchase
    replacement network equipment to support next-generation
    services. With the increasing pace of change, service providers
    require platforms with the flexibility to rapidly deploy
    advanced video services while minimizing lengthy and
    capital-intensive network upgrades.    The
    BigBand Offering
        
    Intelligent Bandwidth Management.  Using our
    solutions, service providers can address their increasing
    bandwidth needs. For example, we offer what we believe to be the
    most widely deployed switched digital video solution
    commercially available today. Our Switched Digital Video
    solution only transmits channels to subscribers when the
    subscribers in a service group are in the process of watching
    those channels, instead of broadcasting all channels to all
    subscribers all the time. This enables service providers to
    achieve 50% or greater savings in bandwidth usage for digital
    subscribers, allowing service providers to offer additional
    services (such as HDTV channels) without altering the subscriber
    viewing experience.
    High-Quality Video Experience.  Our solutions
    allow service providers to minimize the likelihood of video
    quality errors by detecting potential video quality degradation
    in real-time and correcting such degradation before the video
    stream is delivered to subscribers. Our Broadcast Video solution
    is designed to increase the 6




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volume and quality of video delivered across a fixed-bandwidth
    network by optimizing the delivery of video streams, while our
    program level redundancy functionality adds the switching
    capability to automatically provision an alternative video
    stream should the quality of the primary stream begin to degrade.  
    Enhanced Video Personalization.  Using our
    solutions, service providers have the ability to understand the
    viewing habits of their customers and, as a result, can more
    accurately tailor programming packages to the interests of their
    subscribers. For example, our Switched Digital Video solution
    enables service providers to satisfy consumer demand for
    increasingly personalized content by expanding the number of
    channels that can be offered because selected channels are only
    delivered when the channel is requested by a subscriber in the
    service group. Using this solution, one of our customers was
    able to offer additional channel packages tailored to
    demographic groups.
    Ability to Deliver Relevant Video
    Advertising.  Our solutions allow service
    providers to insert advertising tailored to specific subscriber
    groups. For example, using our IPTV solution, service providers
    can simultaneously insert different ads into multiple copies of
    the same program and forward them to specific geographic zones.
    This allows service providers to attract advertisers interested
    in reaching niche markets.
    Improved Return on Existing Infrastructure
    Investment.  Our network-based solutions allow
    service providers to manage service quality from the network,
    rather than deploying costly personnel and equipment at the
    customer premises. Because our solutions are deployed at the
    network level, service providers can leverage their
    infrastructure investment across many subscribers and avoid the
    hardware and service costs associated with an upgrade of
    equipment in the homes of subscribers.
    High Availability.  Our solutions are built
    utilizing carrier class hardware that provides our customers
    with solutions that offer improved uptime of the platforms for
    the video services they deliver to consumers. The high
    availability of our platforms is designed to reduce the cost of
    maintenance of these platforms, and as a result reduce the total
    cost of ownership.
    Platform Flexibility.  Our solutions feature a
    fully programmable hardware and modular software architecture.
    Our
    field-upgradable
    hardware is designed to meet service provider platform
    flexibility requirements and to minimize the need to replace
    existing hardware.  Strategy
    
    Enhance Technology Leadership Position.  Our
    core strength is our media processing and video systems design
    expertise. We use this expertise to deliver what we believe to
    be the most-widely deployed switched digital video product
    commercially available today. We will continue leveraging our
    expertise to deliver solutions that focus on optimizing network
    infrastructure and enabling delivery of a high-quality user
    experience.
    Leverage Modular Architecture to Accelerate New Product
    Introduction. We have created a series of media processing
    software modules that, when combined with our programmable
    hardware and switching fabric, serve as the foundation for a
    range of network-based solutions. We believe our software
    modules can serve as the foundation for rapidly delivering
    solutions that address our customers bandwidth and service
    delivery needs.
    Expand Footprint Within Existing Customer
    Base.  We have customer relationships with a
    number of service providers both in the U.S. and
    internationally, including seven of the ten largest service
    providers in the U.S. We believe these customer
    relationships give us a strong advantage in understanding our
    customers network challenges and delivering timely
    solutions. We will continue to work closely with our customers
    on the designs of their network architectures and emerging
    services, expand our relationships with these customers to
    deploy more of our existing applications and develop and deliver
    new applications to address their network challenges. 7




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
    Expand Customer Base.  Service providers deploy
    video services to subscribers across networks based on coaxial,
    fiber and copper. We have successfully deployed our solutions
    across these access technologies. We are currently providing
    Verizon with a solution that allows digital transmission of
    video over fiber-optic lines. Other telecommunications companies
    deploying video services over existing DSL lines leverage our
    media processing expertise to provide such video services. Still
    others use our solutions to carry services over coaxial cable.
    We intend to leverage our media processing expertise to
    penetrate new customers worldwide, regardless of the type of
    access networks they use.
    Broaden Advanced Advertising Capabilities.  We
    currently enable service providers to insert video
    advertisements targeted to subscribers in specific geographic
    zones. We intend to collaborate with our customers to continue
    developing and deploying next-generation advertising solutions.  Solutions
    Switched Digital Video. and/or
  
    Broadcast Video.
 8




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TelcoTV.
  Personalized Video.
  IPTV over DOCSIS.
  Platforms
    and Technologies
  field-upgradeable
  BigBand Broadband Multimedia-Service Router
    (BMR).
  BigBand Broadband Edge QAM (BEQ).
 9




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BigBand Media Services Platform (MSP2000).
  Converged Video Exchange (CVEx).
  Software
    Applications
    
    RateShaping.  Our RateShaping module combines
    digital signal processing and statistical multiplexing using
    complex algorithms to enable more video streams to be
    transported using the same amount of bandwidth. With
    RateShaping, we conserve bandwidth by intelligently allocating
    bandwidth to programs that require more, while reducing
    bandwidth to programs that require less. The diagram below
    depicts how our RateShaping module can take variable-rate video
    streams and adjust them to conform to a fixed amount of
    bandwidth capacity.  
  
    RateClamping.  The amount of bandwidth required
    to deliver a digital video program varies based on the
    complexity of the picture being transmitted within that program.
    For applications where a constant bit rate is desired, such as
    Switched Digital Video, RateClamping converts variable input
    feeds into constant bit rate streams, with the output bandwidth
    determined according to the service providers priorities.
    RateClamping is frequently utilized to deliver services such as
    VOD, Switched Digital Video and network-based digital video
    recorders. The diagram below depicts how our RateClamping module
    can convert variable-rate video streams into constant-rate video
    streams.  
  
    Splicing.  Our Splicing functionality allows an
    alternate program, usually an advertisement, to be seamlessly
    inserted into an existing video stream. Using our Splicing
    functionality, service providers 10




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can perform hundreds of concurrent splices of different
    advertisements to multiple advertising zones, targeting
    different neighborhoods, in a single BMR. Our Splicing
    functionality is integral to our Broadcast Video solution.  
    Program-level Redundancy.  Our Redundancy
    module inspects a video stream at the individual program level
    to detect errors and switches to the
    back-up
    source program without interrupting other programs on the same
    transport stream. By contrast, other competitive redundancy
    solutions do not detect problems with individual programs, which
    can result in a lower quality viewer experience.
    Metadata Processing.  Our applications process
    metadata such as the name of the program, plot summary and
    actors. This allows the service provider to actively control the
    type and amount of metadata that is provided to the
    subscribers television, thus enabling the service provider
    to populate program guide content and provide enhanced
    interactive TV functions.  Customers
    Bright House Networks

Cox Communications

SsangyongCableone

Delta NV

SugysCablevision Systems

Guangdong Tongke

Time Warner CableCharter Communications

Knology, Inc.

VerizonComcast

Multikabel NV

Videotron       Backlog
   11




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Sales and
    Marketing
      Customer
    Service and Technical Support
    on-site
  Research
    and Development
     12




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Intellectual
    Property
          Manufacturing
    and Suppliers
       13




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Competition
    
    product performance, features, interoperability and reliability;
    technological expertise;
    relationships with service providers;
    price of products and services and cost of ownership;
    sales and distribution capabilities;
    customer service and support;
    compliance with industry standards and certifications;
    size and financial stability of operations;
    breadth of product line;
    intellectual property portfolio;
    ability to scale manufacturing; and
    ability to interoperate with other vendors.     14




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Employees
    By function:Servicing and manufacturing


90Research and development


262Sales and marketing


70General and administrative


62Total employees


484By location:United States


235Israel


170Rest of world


79Total employees


484     Financial
    Information About Segments and Geographic Areas
  Form 10-K.
  Additional
    Information
  1-800-SEC-0330. http://www.sec.gov
  http://www.bigbandnet.com. Form 10-K, Form 10-Q Form 8-K, Form 10-K.
 15




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Item 1A.
    RISK
    FACTORS  An investment in our equity securities involves significant
    risks. Any of these risks, as well as other risks not currently
    known to us or that we currently consider immaterial, could have
    a material adverse effect on our business, prospects, financial
    condition or operating results. The trading price of our common
    stock could decline due to any of these risks, and you may lose
    all or part of your investment. In assessing the risks described
    below, you should also refer to the other information contained
    in this Annual Report on
    Form 10-K,
    including our consolidated financial statements and the related
    notes, before deciding to purchase any shares of our common
    stock.
  We
    depend on cable multiple system operators (MSOs) and
    telecommunications companies adopting advanced technologies for
    substantially all of our net revenues, and any decrease or delay
    in capital spending for these advanced technologies would harm
    our operating results, financial condition and cash
    flows.
      
    annual budget cycles;
    overall consumer demand for video services and the acceptance of
    newly introduced services;
    competitive pressures, including pricing pressures;
    changes in general economic conditions due to fluctuations in
    the equity and credit markets or otherwise;
    the impact of industry consolidation;
    the strategic focus of our customers and potential customers;
    technology adoption cycles and network architectures of service
    providers, and evolving industry standards that may impact them;
    the status of federal, local and foreign government regulation
    of telecommunications and television broadcasting, and
    regulatory approvals that our customers need to obtain;
    discretionary customer spending patterns;
    bankruptcies and financial restructurings within the
    industry; and
    work stoppages or other labor- or labor market-related issues
    that may impact the timing of orders and revenues from our
    customers.    Our
    operating results are likely to fluctuate significantly and may
    fail to meet or exceed the expectations of securities analysts
    or investors or our guidance, causing our stock price to
    decline.
    
    the level and timing of capital spending by our customers;
    the timing, mix and amount of orders, especially from
    significant customers;
    the level of our deferred revenue balances; 16




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
    changes in market demand for our products;
    our mix of products sold;
    the mix of software and hardware products sold;
    our unpredictable and lengthy sales cycles, which typically
    range from six to 18 months;
    the timing of revenue recognition on sales arrangements, which
    may include multiple deliverables and result in delays in
    recognizing revenue;
    our ability to design, install and receive customer acceptance
    of our products;
    materially different acceptance criteria in key customers
    agreements, which can result in large amounts of revenue being
    recognized, or deferred, as the different acceptance criteria
    are applied to large orders;
    new product introductions by our competitors;
    market acceptance of new or existing products offered by us or
    our customers;
    competitive market conditions, including pricing actions by our
    competitors;
    our ability to complete complex development of our software and
    hardware on a timely basis;
    unexpected changes in our operating expenses;
    the impact of new accounting, income tax and disclosure rules;
    the cost and availability of components used in our products;
    the potential loss of key manufacturer and supplier
    relationships; and
    changes in domestic and international regulatory environments.    Our
    customer base is highly concentrated, and there are a limited
    number of potential customers for our products. The loss of any
    of our key customers would likely reduce our revenues
    significantly.
     17




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If
    revenues forecasted for a particular period are not realized in
    such period due to the lengthy, complex and unpredictable sales
    cycles of our products, our operating results for that or
    subsequent periods will be harmed.
    
    a significant technical evaluation period;
    a significant commitment of capital and other resources by
    service providers;
    substantial time required to engineer the deployment of new
    technologies for new video services;
    substantial testing and acceptance of new technologies that
    affect key operations; and
    substantial test marketing of new services with subscribers.      The
    markets in which we operate are intensely competitive, many of
    our competitors are larger, more established and better
    capitalized than we are, and some of our competitors have
    integrated products performing functions similar to our products
    into their existing network infrastructure offerings, and
    consequently our existing and potential customers may decide
    against using our products in their networks, which would harm
    our business.
     18




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We
    have been unable to achieve sustained profitability, which could
    harm the price of our stock.
    We may
    not accurately anticipate the timing of the market needs for our
    products and develop such products at the appropriate times at
    significant research and development expense, or we may not gain
    market acceptance of our several emerging video services and/or
    adoption of new network architectures and technologies, any of
    which could harm our operating results and financial
    condition.
         19




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Our
    ability to grow will depend significantly on our delivery of
    products that help enable telecommunications companies to
    provide video services. If the demand for video services from
    telecommunications companies does not materialize or if these
    service providers find alternative methods of delivering video
    services, future sales of our Video products will
    suffer.
      We
    anticipate that our gross margins will fluctuate with changes in
    our product mix and expected decreases in the average selling
    prices of our hardware and software products, which will
    adversely impact our operating results.
    Lower
    deferred revenue balances will make future period results less
    predictable.
   20




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Continued
    weak general economic conditions may adversely affect our
    financial condition and results of operations and make our
    future business more difficult to forecast and
    manage.
      Our
    efforts to develop additional channels to market and sell our
    products internationally may not succeed.
    and/or and/or
  We are
    exposed to fluctuations in currency exchange rates, which could
    negatively affect our financial results and cash
    flows.
     21




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Our
    products must interoperate with many software applications and
    hardware found in our customers networks. If we are unable
    to ensure that our products interoperate properly, our business
    would be harmed.
        Our
    ability to sell our products is highly dependent on the quality
    of our support and services offerings, and our failure to offer
    high-quality support and services would have a material adverse
    effect on our sales and results of operations.
    If we
    fail to comply with new laws and regulations, or changing
    interpretations of existing laws or regulations, our future
    revenues could be adversely affected.
   22




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Our
    expansion of international operations or reliance on operations
    of contract manufacturers or developers may not
    succeed.
      
    continued uncertainty in the global economy;
    fluctuations in the value of local currencies in the markets we
    are attempting to penetrate may adversely affect the price
    competitiveness of our products;
    fluctuations in currency exchange rates, primarily fluctuations
    in the Israeli New Shekel, may have an adverse effect on our
    operating costs;
    political and economic instability;
    unpredictable changes in foreign government regulations and
    telecommunications standards;
    legal, cultural and language differences in the conduct of
    business;
    import and export license requirements, tariffs, taxes and other
    trade barriers;
    potentially adverse tax consequences;
    the burden of complying with a wide variety of foreign laws,
    treaties and technical standards;
    acts of war or terrorism and insurrections;
    difficulty in staffing and managing foreign operations; and
    changes in economic policies by foreign governments.    Regional
    instability in Israel may adversely affect business conditions
    and may disrupt our operations and negatively affect our
    operating results.
   23




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We
    depend on a limited number of third parties to provide key
    components of, and to provide manufacturing and assembly
    services with respect to, our products.
     24




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We
    must manage our business effectively even if our infrastructure,
    management and resources might be strained due to our expense
    reduction efforts and recent officer departures.
  ,
  Our
    failure to adequately protect our intellectual property and
    proprietary rights, or to secure such rights on reasonable
    terms, may adversely affect us.
       25




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We may
    face intellectual property infringement claims from third
    parties.
    Our
    use of open source and third-party software could impose
    limitations on our ability to commercialize our
    products.
    Our
    business is subject to the risks of warranty returns, product
    liability and product defects.
     26




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We may
    engage in future acquisitions that dilute the ownership
    interests of our stockholders, cause us to use a significant
    portion of our cash, incur debt or assume contingent
    liabilities.
    
    issue equity securities which would dilute our current
    stockholders percentage ownership;
    incur substantial debt;
    assume contingent liabilities; or
    spend significant cash.    
    difficulties in the assimilation of acquired operations,
    technologies
    and/or
    products;
    unanticipated acquisition transaction costs;
    the diversion of managements attention from other business;
    adverse effects on existing business relationships with
    suppliers and customers;
    risks associated with entering markets in which we have no or
    limited prior experience;
    the potential loss of key employees of acquired businesses;
    difficulties in the assimilation of different corporate cultures
    and practices; and
    substantial charges for the amortization of certain purchased
    intangible assets, deferred stock compensation or similar items.    Negative
    conditions in the global credit markets may impair the value or
    reduce the liquidity of a portion of our investment
    portfolio.
     27




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If we
    do not adequately manage and evolve our financial reporting and
    managerial systems and processes, our operating results and
    financial condition may be harmed.
    While
    we believe that we currently have proper and effective internal
    control over financial reporting, we must continue to comply
    with laws requiring us to evaluate those internal
    controls.
    We are
    subject to import/export controls that could subject us to
    liability or impair our ability to compete in international
    markets.
      Our
    business is subject to the risks of earthquakes, fire, floods
    and other natural catastrophic events, and to interruption by
    manmade problems such as computer viruses or
    terrorism.
   28




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Item 1B.
    UNRESOLVED
    STAFF COMMENTS    Item 2.
    PROPERTIES        Item 3.
    LEGAL
    PROCEEDINGS  Form 10-K.
  Item 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS   PART II  Item 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  Market
    Information for Common Stock
      Year EndedDecember 31, 2009High


LowFirst quarter

$
7.10


$
4.13Second quarter

$
7.18


$
4.68Third quarter

$
5.90


$
3.63Fourth quarter

$
4.45


$
3.20   29




---



##### Table of Contents



Year EndedDecember 31, 2008High


LowFirst quarter

$
6.47


$
3.75Second quarter

$
7.96


$
4.64Third quarter

$
5.00


$
2.76Fourth quarter

$
6.03


$
2.36   Dividend
    Policy
    Stockholders
    Recent
    Sales of Unregistered Securities
    Issuer
    Purchases of Equity Securities
    Item 6.
    SELECTED
    FINANCIAL DATA  Form 10-K.
  Years Ended December 31,2009


2008


2007


2006


2005Consolidated Statement of Operations Data:Net revenues:Products

$
93,662


$
148,417


$
144,715


$
154,013


$
85,966Services


45,852



36,876



31,795



22,611



12,013Total net revenues


139,514



185,293



176,510



176,624



97,979Cost of net revenues:Products


45,961



60,207



76,260



74,152



55,933Services


12,384



12,755



13,414



9,245



3,900Total cost of net revenues


58,345



72,962



89,674



83,397



59,833Gross profit:Products


47,701



88,210



68,455



79,861



30,033Services


33,468



24,121



18,381



13,366



8,113Total gross profit


81,169



112,331



86,836



93,227



38,146 30




---



##### Table of Contents



Years Ended December 31,2009


2008


2007


2006


2005Operating expenses:Research and development


46,431



54,043



51,862



37,194



30,701Sales and marketing


24,201



28,935



39,868



29,523



22,729General and administrative


18,862



20,884



16,286



13,176



6,984Restructuring charges


1,356



2,055



2,998







Amortization of intangible assets






733



572



572



573Gain on sale of intangible assets






(1,800
)










Class action litigation charges


477



1,504











Total operating expenses


91,327



106,354



111,586



80,465



60,987Operating (loss) income


(10,158
)


5,977



(24,750
)


12,762



(22,841
)Other income (expense)


2,352



6,203



608



(1,360
)


(1,696
)(Loss) income before (benefit from) provision for income taxes
    and cumulative effect of change in accounting principle


(7,806
)


12,180



(24,142
)


11,402



(24,537
)(Benefit from) provision for income taxes


(1,067
)


2,400



1,225



2,525



325(Loss) income before cumulative effect of change in acccounting
    principle


(6,739
)


9,780



(25,367
)


8,877



(24,862
)Cumulative effect of change in accounting principle


















(633
)Net (loss) income

$
(6,739
)

$
9,780


$
(25,367
)

$
8,877


$
(25,495
)Basic net (loss) income per common share

$
(0.10
)

$
0.15


$
(0.52
)

$
0.78


$
(2.36
)Diluted net (loss) income per common share

$
(0.10
)

$
0.15


$
(0.52
)

$
0.16


$
(2.36
)Shares used in basic net (loss) income per common share


65,936



63,559



49,041



11,433



10,794Shares used in diluted net (loss) income per common share


65,936



67,264



49,041



57,053



10,794   As of December 31,2009

2008

2007

2006

2005Consolidated Balance Sheet Data:Cash, cash equivalents and marketable securities

$
171,908


$
174,635


$
154,520


$
65,474


$
24,287Working capital


147,496



142,398



109,296



25,056



5,812Total assets


223,588



234,122



218,586



129,050



76,816Current and long-term debt














14,536



11,418Preferred stock warrant liabilities














3,152



1,642Redeemable convertible preferred stock














117,307



117,307Common stock and additional paid-in capital


283,771



265,241



248,201



17,075



14,990Total stockholders equity (deficit)


150,276



138,419



111,586



(95,614
)


(107,819
)  31




---



##### Table of Contents



Item 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  The following discussion of our financial condition and
    results of operations should be read together with the
    consolidated financial statements and related notes that are
    included elsewhere in this
    Form 10-K.
    This discussion contains forward-looking statements, which are
    based upon current expectations that involve risks and
    uncertainties. Our actual results may differ materially from
    those anticipated in these forward-looking statements as a
    result of various factors, including those set forth under
    Risk Factors or in other parts of this
    Form 10-K.
  Overview
        Net Revenues.
   32




---



##### Table of Contents



Cost of Net Revenues.
  Gross Margin.
  Operating Expenses.
        Contingencies
 33




---



##### Table of Contents



Critical
    Accounting Policies and Estimates
      Revenue
    Recognition
      if-and-when-available
       34




---



##### Table of Contents



Inventories,
    Net
  first-in,
  Warranty
    Liabilities
    Stock-Based
    Compensation
  Compensation  Stock Compensation
   35




---



##### Table of Contents



Impairment
    of Long-lived Assets
        Accounting
    for Income Taxes
       36




---



##### Table of Contents



Results
    of Operations
    Years Ended December 31,2009


2008


2007Total net revenues


100.0
%


100.0
%


100.0
%Total cost of net revenues


41.8



39.4



50.8Total gross profit


58.2



60.6



49.2Operating expenses:Research and development


33.3



29.2



29.4Sales and marketing


17.3



15.6



22.6General and administrative


13.6



11.3



9.2Restructuring charges


1.0



1.1



1.7Amortization of intangible assets






0.4



0.3Gain on sale of intangible assets






(1.0
)


Class action litigation charges


0.3



0.8



Total operating expenses


65.5



57.4



63.2Operating (loss) income


(7.3
)


3.2



(14.0
)Interest income


1.8



2.8



3.9Interest expense










(0.4
)Other (expense) income, net


(0.1
)


0.6



(3.2
)(Loss) income before (benefit from) provision for income taxes


(5.6
)


6.6



(13.7
)(Benefit from) provision for income taxes


(0.8
)


1.3



0.7Net (loss) income


(4.8
)%


5.3
%


(14.4
)%   Years
    Ended December 31, 2009 and 2008
  Net
    Revenues
       37




---



##### Table of Contents



Years Ended December 31,2009


2008


2007United States


88.7
%


91.4
%


83.2
%Asia


7.0



3.6



7.7Europe


3.0



2.9



8.3Americas, excluding United States


1.3



2.1



0.8Total net revenues


100.0
%


100.0
%


100.0
%   Product Revenues.
  Service Revenues.
    Gross
    Profit and Gross Margin
  Gross profit.
  Product gross margin.
  Services gross margin.
 38




---



##### Table of Contents



Operating
    Expenses
  Research and Development.
  Sales and Marketing.
  General and Administrative.
  Restructuring Charges.
  February


April


October2009 Plan


2008 Plan


2007 Plan


TotalRestructuring charges:Year Ended December 31, 2009Vacated facilities costs

$



$



$
699


$
699Severance and related expenses


657











657Total restructuring charges

$
657


$



$
699


$
1,356Year Ended December 31, 2008Vacated facilities costs

$



$
1,094


$
400


$
1,494Severance and related expenses






272



270



542Other charges










19



19Total restructuring charges

$



$
1,366


$
689


$
2,055Expiration date of facilities lease obligations:


Not applicable



January 2013



March 2012   Gain on sale of intangible assets.
  Class action lawsuit charges. Contingencies,
 39




---



##### Table of Contents



Interest
    Income
    Other
    (expense) income, net
    Provision
    for Income Taxes
    with-and-without Income Taxes
    Years
    Ended December 31, 2008 and 2007
  Net
    Revenues
     40




---



##### Table of Contents



Product Revenues.
  Service Revenues.
  Gross
    Profit and Gross Margin
  Gross profit.
  Product gross margin.
  Services gross margin.
  Operating
    Expenses
  Research and Development.
  Sales and Marketing.
 41




---



##### Table of Contents



General and Administrative.
  Restructuring Charges.
    Gain on sale of intangible assets.
  Class action lawsuit charges.
  Interest
    Income
    Interest
    expense
    Other
    Income (Expense), Net
   42




---



##### Table of Contents



Provision
    for Income Taxes
  with-and-without
    Liquidity
    and Capital Resources
    Cash
    Flow
  Cash, cash equivalents and marketable
    securities.
  Operating
    activities
    Years Ended December 31,2009


2008


2007Net (loss) income

$
(6,739
)

$
9,780


$
(25,367
)Add back non-cash charges


23,458



20,494



27,076Net income before non-cash charges(1)


16,719



30,274



1,709Decrease in accounts receivable


7,866



1,494



6,133Decrease in inventories, net


1,190



709



321(Decrease) increase in deferred revenues


(15,696
)


(6,726
)


16,686Decrease in accounts payable and accrued and other liabilities


(6,925
)


(2,332
)


(2,063
)Other, net


(2,831
)


115



(1,924
)Net cash provided by operating activities

$
323


$
23,534


$
20,862  43




---



##### Table of Contents



(1)
    
    Non-cash charges primarily related to stock-based compensation
    and depreciation of property and equipment, and for 2007
    revaluation of warrant liabilities.      Investing
    Activities
        Financing
    Activities
        Liquidity
    and Capital Resource Requirements
   44




---



##### Table of Contents



Contractual
    Obligations and Commitments
    Payments Due by Period:Less Than








More ThanTotal


One Year


1-3 Years


3-5 Years


5 YearsOperating lease obligations(1)

$
6,949


$
2,767


$
4,108


$
74


$
Purchase obligations(2)


2,972



2,972











Total obligations

$
9,921


$
5,739


$
4,108


$
74


$
     (1)
    
    Operating lease obligations are net of sublease rentals from a
    portion of our Tel Aviv facility.(2)
    
    Purchase obligations comprise firm non-cancelable agreements to
    purchase inventory.  Off-Balance
    Sheet Arrangements
  Regulation S-K.
  Effects
    of Inflation
    Recent
    Accounting Pronouncements
  Form 10-K
  Item 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK  Interest
    Rate Sensitivity
    Foreign
    Currency Risk
   45




---



##### Table of Contents



46




---



##### 



Item 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA  Index to
    Consolidated Financial Statements
   
 The following financial statements are filed as part of this
    Annual Report:Report of Independent Registered Public
    Accounting Firm


48Consolidated Balance Sheets


49Consolidated Statements of Operations


50Consolidated Statements of Redeemable Convertible
    Preferred Stock and Stockholders Equity (Deficit)


51Consolidated Statements of Cash Flows


53Notes to Consolidated Financial Statements


54   47




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                 48




---



##### Table of Contents



BigBand
    Networks, Inc.
  Consolidated
    Balance Sheets
  As of December 31,2009


2008(In thousands, except per share data)ASSETSCurrent assets:Cash and cash equivalents

$
24,894


$
50,981Marketable securities


147,014



123,654Accounts receivable, net of allowance for doubtful accounts of
    $56 and $39 as of December 31, 2009 and 2008, respectively


18,495



26,361Inventories, net


4,933



6,123Prepaid expenses and other current assets


6,177



3,716Total current assets


201,513



210,835Property and equipment, net


11,417



15,358Goodwill


1,656



1,656Other non-current assets


9,002



6,273Total assets

$
223,588


$
234,122LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable

$
9,483


$
8,350Accrued compensation and related benefits


5,023



11,433Current portion of deferred revenues, net


32,428



39,433Current portion of other liabilities


7,083



9,221Total current liabilities


54,017



68,437Deferred revenues, net, less current portion


12,438



21,129Other liabilities, less current portion


2,642



2,392Accrued long-term Israeli severance pay


4,215



3,745Commitments and contingenciesStockholders equity:Common stock, $0.001 par value, 250,000 shares
    authorized as of December 31, 2009 and 2008; 67,138 and
    64,639 shares issued and outstanding as of
    December 31, 2009 and 2008, respectively


67



65Additional paid-in capital


283,704



265,176Accumulated other comprehensive income


124



58Accumulated deficit


(133,619
)


(126,880
)Total stockholders equity


150,276



138,419Total liabilities and stockholders equity

$
223,588


$
234,122    49




---



##### Table of Contents



BigBand
    Networks, Inc.
  Consolidated Statements of
    Operations
  Years Ended December 31,2009


2008


2007(In thousands, except per share amounts)Net revenues:Products

$
93,662


$
148,417


$
144,715Services


45,852



36,876



31,795Total net revenues


139,514



185,293



176,510Cost of net revenues:Products


45,961



60,207



76,260Services


12,384



12,755



13,414Total cost of net revenues


58,345



72,962



89,674Gross profit


81,169



112,331



86,836Operating expenses:Research and development


46,431



54,043



51,862Sales and marketing


24,201



28,935



39,868General and administrative


18,862



20,884



16,286Restructuring charges


1,356



2,055



2,998Amortization of intangible assets






733



572Gain on sale of intangible assets






(1,800
)


Class action litigation charges


477



1,504



Total operating expenses


91,327



106,354



111,586Operating (loss) income


(10,158
)


5,977



(24,750
)Interest income


2,570



5,174



6,863Interest expense










(648
)Other (expense) income, net


(218
)


1,029



(5,607
)(Loss) income before (benefit from) provision for income taxes


(7,806
)


12,180



(24,142
)(Benefit from) provision for income taxes


(1,067
)


2,400



1,225Net (loss) income

$
(6,739
)

$
9,780


$
(25,367
)Basic net (loss) income per common share

$
(0.10
)

$
0.15


$
(0.52
)Diluted net (loss) income per common share

$
(0.10
)

$
0.15


$
(0.52
)Shares used in basic net (loss) income per common share


65,936



63,559



49,041Shares used in diluted net (loss) income per common share


65,936



67,264



49,041    50




---



##### Table of Contents



BigBand
    Networks, Inc.
  Consolidated Statements of Redeemable
    Convertible Preferred Stock and Stockholders Equity
    (Deficit)
  Redeemable





















AccumulatedConvertible



Common Stock


Additional


Deferred


OtherPreferred Stock



Class A


Class B


Paid-in


Stock-Based


Comprehensive


Accumulated


StockholdersShares


Amount



Shares


Amount


Shares


Amount


Capital


Compensation


Income (Loss)


Deficit


Equity (Deficit)(In thousands)Balance as of December 31, 2006


29,439


$
117,307




8,241


$
8



3,619


$
4


$
17,063


$
(1,405
)

$
9


$
(111,293
)

$
(95,614
)Conversion of class B common stock into class A common
    Stock











3,619



4



(3,619
)


(4
)


















Conversion of preferred stock into class A common stock


(29,439
)


(117,307
)



37,762



38











117,269















117,307Proceeds from initial public offering, net of expenses











7,500



8











87,761















87,769Reclassification of preferred stock warrant liabilities to APIC
    upon IPO



























8,125















8,125Proceeds from exercise of class A common stock options











4,056



4











4,684















4,688Proceeds from issuance of common stock under employee stock
    purchase plan











213















1,089















1,089Tax benefit from stock options



























25















25Stock-based compensation











12















10,408















10,408Net exercise for payment of tax liability for employee



























(113
)














(113
)Amortization of deferred stock-based compensation, net of
    reversals



























(335
)


1,202











867Stock-based compensation related to non-employees in exchange
    for services











2















341















341Exercise of warrants











502















1,822















1,822Comprehensive loss:Net unrealized gains on cash flow hedges



































42







42Net unrealized gains on marketable securities



































194







194Net settled unrealized gains on cash flow hedges



































3







3Net loss







































(25,367
)


(25,367
)Total comprehensive loss











































(25,128
) 51




---



##### Table of Contents



Redeemable





















AccumulatedConvertible



Common Stock


Additional


Deferred


OtherPreferred Stock



Class A


Class B


Paid-in


Stock-Based


Comprehensive


Accumulated


StockholdersShares


Amount



Shares


Amount


Shares


Amount


Capital


Compensation


Income (Loss)


Deficit


Equity (Deficit)(In thousands)Balance as of December 31, 2007











61,907



62











248,139



(203
)


248



(136,660
)


111,586Proceeds from exercise of common stock options











2,275



2











3,753















3,755Proceeds from issuance of common stock under employee stock
    purchase plan











362



1











1,483















1,484Vesting of restricted stock units, net











27































Tax benefit from stock options



























158















158Stock-based compensation



























11,695















11,695Net exercise for payment of tax liability for employee



























(29
)














(29
)Amortization of deferred stock-based compensation, net of
    reversals



























(23
)


203











180Exercise of warrants  cashless











68































Comprehensive income:Net unrealized losses on cash flow hedges



































(340
)






(340
)Net unrealized gains on marketable securities



































476







476Net settled unrealized losses on cash flow hedges



































(326
)






(326
)Net income







































9,780



9,780Total comprehensive income











































9,590Balance as of December 31, 2008











64,639



65











265,176







58



(126,880
)


138,419Proceeds from exercise of common stock options











1,444



1











2,711















2,712Proceeds from issuance of common stock under employee stock
    purchase plan











478















1,593















1,593Vesting of restricted stock units, net











577



1











(1
)














Tax benefit from stock options



























17















17Stock-based compensation



























14,219















14,219Net exercise for payment of tax liability for employee



























(11
)














(11
)Comprehensive loss:Net unrealized gains on cash flow hedges



































191







191Net unrealized losses on marketable securities



































(404
)






(404
)Net settled unrealized gains on cash flow hedges



































279







279Net loss







































(6,739
)


(6,739
)Total comprehensive loss











































(6,673
)Balance as of December 31, 2009





$





67,138


$
67






$



$
283,704


$



$
124


$
(133,619
)

$
150,276    52




---



##### Table of Contents





BigBand
    Networks, Inc.
  Consolidated Statements of Cash
    Flows
  Years Ended December 31,2009


2008


2007(In thousands, except per share amounts)Cash Flows from Operating activitiesNet (loss) income

$
(6,739
)

$
9,780


$
(25,367
)Adjustments to reconcile net (loss) income to net cash provided
    by operating activities:Depreciation of property and equipment


8,457



9,833



9,771Amortization of software license


417







Amortization of intangible assets






733



572Gain on sale of intangible assets  Fast Flow
    technology






(1,800
)


Loss on disposal of property and equipment


103



337



165Revaluation of warrant liabilities










4,974Stock-based compensation


14,219



11,695



10,749Amortization of deferred stock-based compensation






180



867Tax benefit from stock options


(17
)


(158
)


(25
)Net settled unrealized gains (losses) on cash flow hedges


279



(326
)


3Change in operating assets and liabilities:Decrease in accounts receivable, net


7,866



1,494



6,133Decrease in inventories, net


1,190



709



321(Increase) decrease in prepaid expenses and other current assets


(2,493
)


292



(1,501
)Increase in other non-current assets


(808
)


(734
)


(867
)Increase (decrease) in accounts payable


1,133



(3,161
)


(1,286
)Increase in long-term Israeli severance pay


470



557



444(Decrease) increase in accrued and other liabilities


(8,058
)


829



(777
)(Decrease) increase in deferred revenues


(15,696
)


(6,726
)


16,686Net cash provided by operating activities


323



23,534



20,862Cash Flows from Investing activitiesPurchase of marketable securities


(168,539
)


(202,829
)


(170,460
)Proceeds from maturities of marketable securities


130,271



151,154



78,445Proceeds from sale of marketable securities


14,504



27,854



19,800Purchase of property and equipment


(4,619
)


(11,077
)


(12,320
)Purchase of software license


(2,500
)






Proceeds from sale of intangible assets  Fast Flow
    technology






1,800



Proceeds from sale of property and equipment






9



40Decrease (increase) in restricted cash


162



6



(505
)Net cash used in investing activities


(30,721
)


(33,083
)


(85,000
)Cash Flows from Financing activitiesProceeds from exercise of common stock options, net of tax
    liability


2,701



3,726



4,575Proceeds from issuance of common stock under employee stock plans


1,593



1,484



1,089Proceeds from initial public offering, net of expenses










87,769Principal payments on loans and capital leases










(14,550
)Proceeds from exercise of warrants to purchase common stock










1,822Tax benefit from stock options


17



158



25Net cash provided by financing activities


4,311



5,368



80,730Net (decrease) increase in cash and cash equivalents


(26,087
)


(4,181
)


16,592Cash and cash equivalents as of beginning of year


50,981



55,162



38,570Cash and cash equivalents as of end of year

$
24,894


$
50,981


$
55,162Schedule of non-cash transactionsAccrued leasehold improvements

$



$



$
2,300Supplemental disclosure of cash flow informationInterest paid

$



$



$
514Income taxes paid

$
1,239


$
2,874


$
3,945    53




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    Description
    of Business    2.
    Significant
    Accounting Policies  Principles
    of Consolidation
    Use of
    Estimates
    Revenue
    Recognition
  Software,
    if-and-when-available
   54




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Cash,
    Cash Equivalents and Marketable Securities
    available-for-sale
  other-than-temporary other-than-temporary, Investments  Debt and
    Equity Securities
 55




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  other-than-temporary other-than-temporary. other-than-temporary other-than-temporary
  Fair
    Value of Financial Instruments
    Credit
    Risk and Concentrations of Significant Customers
      Percentage of Total Accounts Receivable as of


Percentage of Net Revenues ForDecember 31,


The Years Ended December 31,Customers

2009


2008


2009


2008


2007A


24



64



33



27



13B


*



16



18



29



40C


15



*



10



*



*D


43



*



*



14



11     *
    
    Represents less than 10%   56




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Balance as of


Charged toBeginning of


Costs and


Additions


Balance as ofYear


Expenses


(Deductions)


End of YearYear ended:December 31, 2009

$
39


$
(38
)

$
55


$
56December 31, 2008

$
142


$
64


$
(167
)

$
39December 31, 2007

$
152


$
99


$
(109
)

$
142   Inventories,
    Net
  first-in,
  Property
    and Equipment, Net
    Useful LifeComputers, software and related equipment

3 yearsEngineering and other equipment

5 yearsOffice furniture and fixtures

5 yearsLeasehold improvements

Shorter of lease term or estimated
    useful life of the asset   Software
    licenses purchased
    Impairment
    of Long-Lived Assets
   57




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Goodwill
    Warranty
    Liabilities
    Software
    Development Costs
    Income
    Taxes
     58




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Foreign
    Currency Derivative Instruments
    Derivatives and
    Hedging
   59




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of December 31,2009


2008Derivatives designated as hedging instruments:Notional amount of currency option contracts: Israeli New Shekels


ILS 27,000



ILS 42,000Notional amount of currency option contracts: U.S. dollars

$
7,454


$
11,926Unrealized losses included in other comprehensive income on
    condensed consolidated balance sheets:Settled  underlying derivative was settled but
    forecasted transaction has not occurred

$
(4
)

$
(285
)Unsettled  primarily included as other current
    liabilities


(147
)


(336
)Total unrealized losses included in other comprehensive income

$
(151
)

$
(621
)Derivatives not designated as hedging instruments:Notional amount of foreign currency forward contracts: Israeli
    New Shekels


ILS 5,000



ILS 7,500Notional amount of foreign currency forward contracts: U.S.
    dollars

$
1,323


$
1,923Unrealized (losses) gains included in other income (expense) in
    condensed consolidated statements of operations:Fair value included in other current (liabilities) assets on
    condensed consolidated balance sheets

$
(3
)

$
55     Years Ended December 31,2009


2008Accumulated other comprehensive (loss) income related to cash
    flow hedges as of beginning of year

$
(621
)

$
45Changes in settled and unsettled portion of cash flow hedges


(393
)


(892
)(1,014
)


(847
)Less:Changes in cash flow hedges: Loss reflected in condensed
    consolidated statement of operations


(863
)


(226
)Accumulated other comprehensive loss related to cash flow hedges
    as of end of year

$
(151
)

$
(621
)   Israeli
    Severance Pay
   60




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Stock-based
    Compensation
  Compensation  Stock
    Compensation
      Foreign
    Currency Translation
    Research
    and Development
   61




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Advertising
    Costs
    Other
    Income (Expense), Net
    Preferred
    Stock Warrants
  Distinguishing Liabilities from
    Equity
    Recently
    Adopted Accounting Standards
  Compensation  Retirement Benefits
  2009-05, Fair Value Measurements and Disclosures (Topic
    820)  Measuring Liabilities at Fair Value 2009-05). 2009-05 2009-05 2009-05
  Recently
    Issued Accounting Standards
  2009-13 Revenue Recognition (Topic 605): Multiple-Deliverable Revenue
    Arrangements  a consensus of the FASB Emerging Issues
    Task Force 2009-13) 2009-14 Software (Topic 985): Certain Revenue Arrangements That
    Include Software Elements  a consensus of the FASB
    Emerging Issues Task Force 2009-14). 2009-13 2009-14 2009-13 2009-14
 62




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  2009-13 2009-14
  3.
    Basic and
    Diluted Net (Loss) Income per Common Share    Years Ended December 31,2009


2008


2007Numerator:Net (loss) income

$
(6,739
)

$
9,780


$
(25,367
)Denominator:Weighted average shares used in basic net (loss) income per
    common share


65,936



63,559



49,041Stock options






3,506



Warrants






188



Restricted stock units










Employee stock purchase plan shares






11



Weighted average shares used in diluted net (loss) income per
    common share


65,936



67,264



49,041Basic net (loss) income per common share

$
(0.10
)

$
0.15


$
(0.52
)Diluted net (loss) income per common share

$
(0.10
)

$
0.15


$
(0.52
)     As of December 31,2009

2008

2007Stock options outstanding


12,115



8,572



13,851Restricted stock units


2,497



215



356Employee stock purchase plan shares


302



243



Warrants to purchase common stock


268







428   4.
    Restructuring
    Charges  February
    2009 Restructuring Plan
    April
    2008 Restructuring Plan
   63




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    October
    2007 Restructuring Plan
    Restructuring
    summary
    TotalVacated Facilities


Severance and





RestructuringCosts


Related Expenses


Other Costs


LiabilitiesBalance, December 31, 2006

$



$



$



$
Charges


665



2,193



140



2,998Adjustments


62











62Cash Payments


(101
)


(1,462
)


(34
)


(1,597
)Balance, December 31, 2007


626



731



106



1,463Charges


1,494



542



19



2,055Adjustments(1)


(601
)










(601
)Cash Payments


(823
)


(1,273
)


(125
)


(2,221
)Balance, December 31, 2008


696











696Charges(2)


699



657







1,356Adjustments


41



(22
)






19Cash Payments


(542
)


(635
)






(1,177
)Balance, December 31, 2009

$
894


$



$



$
894Less restructuring liability, current portion














(739
)Restructuring liability, less current portion













$
155     (1)
    
    Adjustments for the year ended December 31, 2008 related to
    the leasehold improvements which were originally charged to
    restructuring expense as part of the subleasing of a vacated
    facility.(2)
    
    Charges for vacated facilities costs for the year ended
    December 31, 2009 were due to the restructuring plan
    approved by the Companys Board of Directors on
    October 29, 2007. 64




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   5.
    Fair
    Value  Fair Value Measurements and Disclosures
    Level 1


Level 2


Level 3


TotalMarketable securities:U.S. Agency debt securities

$
1,265


$
63,014


$



$
64,279Corporate debt securities






70,819







70,819Commercial paper






7,393







7,393Certificates of deposit


4,523











4,5235,788



141,226







147,014Cash equivalents:Money market funds


12,527











12,527Corporate debt securities






181







181Commercial paper






1,000







1,00012,527



1,181







13,708Total cash equivalents and marketable securities

$
18,315


$
142,407


$



$
160,722Cash balances














11,186Total cash, cash equivalents and marketable securities













$
171,908  65




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Level 1


Level 2


Level 3


TotalMarketable securities:U.S. Agency debt securities

$



$
55,296


$



$
55,296Corporate debt securities






44,378







44,378Commercial paper






22,986







22,986Municipal debt securities (taxable)






994







994



123,654







123,654Cash equivalents:Money market funds


30,092











30,092U.S. Agency debt securities






4,004







4,004Corporate debt securities






999







999Commercial paper






9,937







9,93730,092



14,940







45,032Total cash equivalents and marketable securities

$
30,092


$
138,594


$



$
168,686Cash balances














5,949Total cash, cash equivalents and marketable securities













$
174,635     6.
    Balance
    Sheet Data  Marketable
    Securities
  available-for-sale
  As of December 31, 2009Amortized


Unrealized


Unrealized


Estimated FairCost


Gain


Loss


ValueU.S. Agency debt securities

$
64,256


$
70


$
(47
)

$
64,279Corporate debt securities


70,569



288



(38
)


70,819Commercial paper


7,394







(1
)


7,393Certificates of deposit


4,520



4



(1
)


4,523Total marketable securities

$
146,739


$
362


$
(87
)

$
147,014   66




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  As of December 31, 2008Amortized


Unrealized


Unrealized


Estimated FairCost


Gain


Loss


ValueU.S. Agency debt securities

$
54,852


$
444


$



$
55,296Corporate debt securities


44,247



239



(108
)


44,378Commercial paper


22,885



101







22,986Municipal debt securities (taxable)


1,000







(6
)


994Total marketable securities

$
122,984


$
784


$
(114
)

$
123,654     other-than-temporarily other-than-temporary available-for-sale available-for-sale available-for-sale other-than-temporarily
    As of December 31,2009


2008Due within one year

$
107,449


$
88,118Due within one to two years


39,565



35,536Total marketable securities

$
147,014


$
123,654   Inventories,
    Net
    As of December 31,2009


2008Finished products

$
4,933


$
6,085Raw materials, parts and supplies






38Total inventories, net

$
4,933


$
6,123  67




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Prepaid
    Expenses and Other Current Assets
    As of December 31,2009


2008Taxes receivable

$
2,969


$
424Interest receivable


1,070



965Prepaid maintenance


981



667Other


1,157



1,660Total prepaid expenses and other current assets

$
6,177


$
3,716   Property
    and Equipment, Net
    As of December 31,2009


2008Engineering and other equipment

$
30,129


$
29,463Computers, software and related equipment


19,942



18,973Leasehold improvements


5,897



5,745Office furniture and fixtures


1,132



1,19257,100



55,373Less: accumulated depreciation


(45,683
)


(40,015
)Total property, plant and equipment

$
11,417


$
15,358     Goodwill
    Other
    Non-current Assets
    As of December 31,2009


2008Israeli severance pay

$
3,648


$
2,661Software license


2,083



Security deposit


1,962



2,125Restricted cash


583



745Deferred tax assets


449



644Other


277



98Total other non-current assets

$
9,002


$
6,273  68




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Deferred
    Revenues, Net
    As of December 31,2009


2008Deferred service revenues, net

$
27,252


$
39,675Deferred product revenues, net


17,614



20,887Total deferred revenues, net


44,866



60,562Less current portion of deferred revenues, net


(32,428
)


(39,433
)Deferred revenues, net, less current portion

$
12,438


$
21,129   Other
    Liabilities
    As of December 31,2009


2008Rent and restructuring liabilities

$
1,581


$
1,602Foreign, franchise and other income tax liabilities


2,198



2,071Accrued warranty


2,068



3,381Sales and use tax payable


1,310



831Accrued professional fees


462



721Customer prepayments


816



155Accrued class action litigation charges






1,504Other


1,290



1,348Total other liabilities


9,725



11,613Less current portion of other liabilities


(7,083
)


(9,221
)Other liabilities, less current portion

$
2,642


$
2,392  69




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accrued
    Warranty
    Years Ended December 31,2009


2008Balance as of beginning of year

$
3,381


$
4,359Warranty charged to cost of sales


412



1,275Utilization of warranty


(1,003
)


(1,554
)Other adjustments


(722
)


(699
)Balance as of end of year


2,068



3,381Less accrued warranty, current portion


(1,047
)


(1,669
)Accrued warranty, less current portion

$
1,021


$
1,712     7.
    Commitments
    and Contingencies  Commitments
    Years ending December 31,2010

$
3,1882011


3,0692012


1,8812013


1002014


Total minimum lease payments

$
8,238    70




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Legal
    Proceedings
  BigBand
    Networks, Inc. v. Imagine Communications, Inc., Case
    No. 07-351
    Securities
    Litigation
  In re BigBand Networks, Inc.
    Securities Litigation, Case No. C
    07-5101-SBA Ifrah v.
    Bassan-Eskenazi, et. al., Case No. 468401 Wiltjer v. Bassan-Eskenazi,
    et. al., Case
    No. CGC-07-469661
  Indemnities
    8.
    Stockholders
    Equity    Years Ended December 31,2009


2008


2007Cost of net revenues

$
2,084


$
1,733


$
1,534Research and development


4,887



3,901



3,837Sales and marketing


2,432



2,566



4,184General and administrative


4,816



3,675



2,061Total expense

$
14,219


$
11,875


$
11,616   Equity
    Incentive Plans
   71




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Years Ended December 31,2009


2008Available as of start of year


7,298



5,906Authorized shares added


3,232



3,095Options and RSUs cancelled


904



2,12111,434



11,122Options and RSUs granted


(3,939
)


(3,824
)Available as of end of year


7,495



7,298     Weighted


Weighted AverageNumber


Average


Remaining


Aggregateof


Exercise


Contractual Life


IntrinsicOptions


Price


(Years)


ValueOutstanding at December 31, 2006


16,020


$
2.31



8.09


$
55,194Granted


3,846



7.58Exercised


(4,055
)


1.15Cancelled


(1,960
)


4.14Outstanding as of December 31, 2007


13,851


$
3.85



7.33


$
26,651Granted


3,505



4.86Exercised


(2,275
)


1.65Cancelled


(2,051
)


5.97Outstanding as of December 31, 2008


13,030


$
4.17



7.58


$
22,978Granted


1,316



4.02Exercised


(1,444
)


1.87Cancelled


(787
)


5.77Outstanding as of December 31, 2009


12,115


$
4.33



6.99


$
7,621Vested and expected to vest, net of forfeitures


11,853


$
4.32



6.95


$
7,619  72




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Options OutstandingWeighted AverageRemaining





Options ExercisableContractual Life


Weighted Average


No. Shares


Weighted AverageExercise Price ($)

Number


(Years)


Exercise Price


Exercisable


Exercise Price0.20 - 1.00


2,444



4.08


$
0.79



2,444


$
0.791.32 - 2.60


856



5.32



2.11



786



2.093.08 - 5.28


5,139



8.16



4.61



2,053



4.985.29 - 7.34


3,307



7.73



5.97



1,852



6.059.33 - 13.12


196



7.26



11.14



139



11.1514.85 - 18.95


173



7.18



17.35



119



17.4112,115



6.99


$
4.33



7,393


$
3.87     Stock-Based
    Compensation
    Years Ended December 31,2009

2008

2007Stock OptionsExpected volatility

73-75%

63-71%

75-91%Expected term

6 years

6 years

6 yearsRisk-free interest

2.00-2.80%

2.40-3.31%

3.89-4.75%Expected dividends

0.0%

0.0%

0.0%Stock Purchase PlanExpected volatility

61-104%

59-102%

55-90%Expected term

0.5 years

0.5 years

0.5-0.6 yearsRisk-free interest

0.16-0.74%

0.74-1.87%

3.71-5.12%Expected dividends

0.0%

0.0%

0.0%    73




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Restricted
    Stock Units
      Weighted


Weighted AverageAverage


Remaining


AggregateRestricted


Grant-Date


Contractual


IntrinsicStock Units


Fair Value


Life (Years)


ValueUnvested as of December 31, 2006





$
Granted


406



15.14Cancelled


(50
)


18.95Unvested as of December 31, 2007


356


$
14.61



2.23


$
1,832Granted


319



5.35Vested


(27
)


5.56Cancelled


(80
)


18.95Unvested as of December 31, 2008


568


$
9.38



1.24


$
3,138Granted


2,623



5.25Vested


(577
)


7.07Cancelled


(117
)


9.17Unvested as of December 31, 2009


2,497


$
5.58



1.77


$
8,590Expected to vest after December 31, 2009(1)


2,300







1.72


$
7,911     (1)
    
    RSUs expected to vest reflect an estimated forfeiture rate.   74




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Employee
    Stock Purchase Plan
      Years Ended December 31,2009


2008Available as of start of year


1,662



786Authorized shares added


1,293



1,238Common shares issued


(478
)


(362
)Available as of end of year


2,477



1,662   Shares Reserved
    December 31,2009


2008ESPP shares reserved for future issuance


2,477



1,662Restricted stock units


2,497



568Warrants to purchase common stock


268



268Stock options:Outstanding


12,115



13,030Reserved for future grants


7,497



7,29824,854



22,826   Common
    Stock Warrants
   75




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   9.
    Segment
    Reporting  Segment Reporting,
    Years Ended December 31,2009


2008


2007United States

$
123,819


$
169,397


$
146,835Asia


9,734



6,648



13,670Europe


4,198



5,343



14,612Americas, excluding United States


1,763



3,905



1,393Total net revenues

$
139,514


$
185,293


$
176,510     Years Ended December 31,2009


2008


2007Video

$
92,042


$
145,517


$
121,046Data


1,620



2,900



23,669Total product net revenues

$
93,662


$
148,417


$
144,715     Years Ended December 31,2009


2008


2007Video

$
44,140


$
30,811


$
23,009Data


1,712



6,065



8,786Total service net revenues

$
45,852


$
36,876


$
31,795     As of December 31,2009


2008United States

$
6,286


$
8,859Israel


4,728



6,305Rest of World


403



194Total long-lived assets

$
11,417


$
15,358  76




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   10.
    Income
    Taxes    Years Ended December 31,2009


2008


2007Domestic

$
(10,276
)

$
8,833


$
(25,755
)Foreign


2,470



3,347



1,613(Loss) income before (benefit from) provision for income taxes

$
(7,806
)

$
12,180


$
(24,142
)     Years Ended December 31,2009


2008


2007CurrentFederal

$
(687
)

$
199


$
State


108



669



(48
)Foreign


(642
)


1,578



1,228(1,221
)


2,446



1,180DeferredFederal


(39
)


40



38State


(5
)


7



6Foreign


198



(93
)


1154



(46
)


45Total (benefit from) provision for income taxes

$
(1,067
)

$
2,400


$
1,225     Years Ended December 31,2009


2008


2007Tax (benefit) provision at federal statutory rate

$
(2,732
)

$
4,263


$
(8,450
)U.S. losses not benefited (net operating loss carryforward
    utilized)


2,063



(2,668
)


7,113Foreign operations


(1,411
)


1,523



618State taxes


68



441



(27
)Research and development tax credits


(200
)


(510
)


(1,037
)Stock-based compensation


1,074



(797
)


1,127Warrant amortization










1,741Permanent items


71



148



140(Benefit from) provision for income taxes

$
(1,067
)

$
2,400


$
1,225  77




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of December 31,2009


2008Deferred tax assets:Net operating loss carryforwards

$
22,902


$
23,810Reserves and accruals


12,474



13,615Stock compensation


4,262



2,883Depreciation and amortization


1,869



1,652Tax credit carryforwards


3,413



4,091Total deferred tax assets


44,920



46,051Deferred tax liabilities:Goodwill


(239
)


(202
)Gross deferred taxes


44,681



45,849Valuation allowance


(44,471
)


(45,407
)Net deferred taxes

$
210


$
442       non-U.S. subsidiaries
  with-and-without Income Taxes
 78




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2009


2008Balance as of beginning of year

$
2,304


$
1,405Tax positions related to current year


388



531Tax positions related to prior years


700



368Balance as of end of year

$
3,392


$
2,304       11.
    401(k)
    Savings and Retirement Plan   79




---



##### Table of Contents



BIGBAND
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   12.
    Accumulated
    Other Comprehensive Income    As of December 31,2009


2008Net unrealized loss on cash flow hedges

$
(151
)

$
(621
)Net unrealized gain on marketable securities


275



679Total accumulated other comprehensive income

$
124


$
58   13.
    Selected
    Quarterly Financial Information (Unaudited)    Year Ended December 31, 2009Fourth Quarter

Third Quarter

Second Quarter

First QuarterTotal net revenues

$
34,398


$
22,202


$
39,026


$
43,888Gross profit


19,415



11,106



24,995



25,653Net (loss) income


(1,238
)


(10,858
)


3,075



2,282Basic net (loss) income per common share

$
(0.02
)

$
(0.16
)

$
0.05


$
0.04Diluted net (loss) income per common share

$
(0.02
)

$
(0.16
)

$
0.04


$
0.03   Year Ended December 31, 2008Fourth Quarter


Third Quarter


Second Quarter


First QuarterTotal net revenues

$
54,093


$
48,283


$
43,011


$
39,906Gross profit


34,030



28,561



25,373



24,367Net income (loss)


7,322



3,131



1,247



(1,920
)Basic net income (loss) per common share

$
0.11


$
0.05


$
0.02


$
(0.03
)Diluted net income (loss) per common share

$
0.11


$
0.05


$
0.02


$
(0.03
)  80




---



##### Table of Contents



Item 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE    Item 9A.
    CONTROLS
    AND PROCEDURES  Evaluation
    of Disclosure Controls and Procedures
  Form 10-K, Rule 13a-15 Rule 15d-15 Rules 13a-15(e) 15d-15(e)
  Managements
    Report on Internal Control over Financial Reporting
          Changes
    in Internal Control over Financial Reporting
  Rule 13a-15 Rule 15d-15
 81




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                 ERNST
    AND YOUNG LLP
    82




---



##### Table of Contents



Item 9B.
    OTHER
    INFORMATION  Annual
    Meeting
    Management
    Compensation
    2009
    Incentive Compensation Program
 Amir Bassan-Eskenazi, President and Chief Executive
    Officer
  Base Salary (annual):

$
325,000Bonus Potential at 100% fundingFirst Half:


97,500Second Half:


97,500Annual:


130,000Total:

$
325,000   Second Half


Second Half% Goal


% Actual2009 Officer Bonus Goal

Weighting


Achievement1)  Achieve revenues goal


22
%


19
%2)  Achieve earnings goal


15
%


0
%3)  Achieve bookings goal


20
%


13
%4)  Achieve cash and investments goal


4
%


2
%5)  Achieve financial analyst and investor relations
    goal


4
%


1
%6)  Achieve new product development and release
    schedule goals


14
%


14
%7)  Achieve specified product plan goal


4
%


0
%8)  Achieve specified customer satisfaction goal


7
%


7
%9)  Achieve global channels goal


3
%


0
%10) Achieve employee satisfaction and retention goal


7
%


6
%Total


100
%


62
%  83




---



##### Table of Contents



2009
    Incentive Compensation Program
 Maurice Castonguay, Senior Vice President and Chief Financial
    Officer
  Base Salary (annual):

$
280,000Bonus Potential at 100% fundingFirst Half:


42,000Second Half:


42,000Annual:


56,000Total:

$
140,000   Second Half


Second Half% Goal


% Actual2009 Officer Bonus Goal

Weighting


Achievement1)  Achieve earnings goal


5
%


0
%2)  Achieve departmental budgeting goal


10
%


10
%3)  Achieve cash and investments goal


15
%


7
%4)  Achieve expense hedging goal


10
%


10
%5)  Achieve investor relations, financial analyst
    relations, and operating results goals


15
%


4
%6)  Achieve financial controls goal


15
%


15
%7)  Achieve corporate governance goal


10
%


10
%8)  Achieve internal communication goal


12
%


11
%9)  Achieve employee satisfaction and retention goal


8
%


8
%Total


100
%


75
%  84




---



##### Table of Contents



2009
    Incentive Compensation Program
 David Heard, Chief Operating Officer
  Base Salary (annual):

$
325,000Bonus Potential at 100% fundingFirst Half:


68,250Second Half:


68,250Annual:


91,000Total:

$
227,500   Second Half


Second Half% Goal


% Actual2009 Officer Bonus Goal

Weighting


Achievement1)  Achieve specified bookings goal


25
%


16
%2)  Achieve specified margins goal


5
%


5
%3)  Achieve specified revenues goal


10
%


8
%4)  Achieve specified earnings goal


5
%


0
%5)  Achieve product footprint and market share goals


22
%


5
%6)  Achieve product delivery goals


10
%


3
%7)  Achieve specified new product development goal


5
%


1
%8) Achieve development process goals


9
%


9
%9) Achieve customer satisfaction goal


5
%


5
%10) Achieve employee satisfaction, retention and
    development goals


4
%


4
%Total


100
%


56
%   2009
    Incentive Compensation Program
    Rob Horton, Senior Vice President and General Counsel
  Base Salary (annual):

$
250,000Bonus Potential:First Half:


37,500Second Half:


37,500Annual:


50,000Total:

$
125,000   Second Half


Second Half% Goal


% Goal2009 Officer Bonus Goal

Weighting


Weighting1)  Achieve departmental budgeting goal


15
%


15
%2)  Achieve corporate governance and securities
    compliance goals


20
%


15
%3)  Achieve business development goals


15
%


15
%4)  Achieve internal customer satisfaction goal


20
%


20
%5)  Achieve employee satisfaction, retention and
    development goals


5
%


5
%6)  Achieve specified litigation management goals


10
%


10
%7)  Achieve sales support goals


15
%


15
%Total


100
%


95
%  85




---



##### Table of Contents



2009
    Incentive Compensation Program
    Ran Oz, Executive Vice President and Chief Technology
    Officer
  Base Salary (annual):

$
225,000Bonus Potential at 100% fundingFirst Half:


33,750Second Half:


33,750Annual:


45,000Total:

$
112,500   Second Half


Second Half% Goal


% Goal2009 Officer Bonus Goal

Weighting


Weighting1)  Achieve specified product roadmap and planning
    goals


10
%


8
%3)  Achieve specified product demonstration and
    development goal


25
%


23
%4)  Achieve product market share goal


20
%


17
%5)  Achieve specified on-demand product strategy goal


5
%


3
%6)  Achieve customer relations and positioning goal


20
%


15
%7)  Achieve specified innovation-related sales goal


10
%


0
%8)  Achieve employee satisfaction and retention goal


10
%


7
%Total


100
%


73
%  PART III  Item 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE        http://www.bigbandnet.com
    Item 11.
    EXECUTIVE
    COMPENSATION    Item 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS   86




---



##### Table of Contents



Item 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE    Item 14.
    PRINCIPAL
    ACCOUNTING FEES AND SERVICES   PART IV  Item 15.
    EXHIBITS,
    FINANCIAL STATEMENT SCHEDULES  ( Form 10-K.
  Form 10-K
    Balance as of

Charged toBeginning of

Costs and

Additions

Balance as ofYear

Expenses

(Deductions)

End of YearYear ended:December 31, 2009

$
39


$
(38
)

$
55


$
56December 31, 2008

$
142


$
64


$
(167
)

$
39December 31, 2007

$
152


$
99


$
(109
)

$
142     EXHIBIT INDEX
  Incorporated by ReferenceExhibit





File

Exhibit



Filed WithNumber

Description

Form

Number

Number

Filing Date

This 10-K3
.1

Form of Amended and Restated Certificate of Incorporation of the
    Registrant

S-1

333-139652

3.1B

December 22, 20063
.2

Form of Amended and Restated Bylaws of the Registrant

S-1

333-139652

3.2B

December 22, 200610
.1*

Form of Indemnification Agreement

S-1

333-

10.1

December 22, 200610
.2*

2001 Share Option and Incentive Plan

S-1

333-

10.3

December 22, 200610
.3*

2003 Share Option and Incentive Plan

S-1

333-

10.4

December 22, 200610
.4*

2004 Share Option and Incentive Plan
    Sub-Plan for
    Israeli Employees

S-1

333-

10.5

December 22, 2006 87




---



##### Table of Contents



Incorporated by ReferenceExhibit





File

Exhibit



Filed WithNumber

Description

Form

Number

Number

Filing Date

This 10-K10
.5*

2007 Equity Incentive Plan

S-1/A

333-139652

10.6

March 8, 200710
.5A*

Form of Option Agreement (U.S.)

10-Q

001-33355

10.6A

August 8, 200710
.5B*

Form of Option Agreement
    (Non-U.S.)

10-Q

001-33355

10.6B

August 8, 200710
.5C*

Form of Restricted Stock Unit Agreement (U.S.)

10-Q

001-33355

10.6C

August 8, 200710
.5D*

Form of Restricted Stock Unit Agreement
    (Non-U.S.)

10-Q

001-33355

10.6D

August 8, 200710
.5E*

2007 Equity Incentive Plan
    Sub-Plan for
    Israeli Employees

10-Q

001-33355

10.6E

August 8, 200710
.5F*

Form of Israeli
    Sub-Plan
    Option Agreement

10-Q

001-33355

10.6F

August 8, 200710
.6*

Employee Stock Purchase Plan

S-1/A

333-139652

10.23

February 26, 200710
.7*

Employment Agreement  Amir Bassan-Eskenazi

S-1

333-139652

10.8

December 22, 200610
.7A*

Amendment to Employment Agreement  Amir
    Bassan-Eskenazi

8-K

001-33355

10.8A

January 5, 200910
.8*

Employment Agreement  Ran Oz

S-1

333-139652

10.9

December 22, 200610
.8A*

Amendment to Employment Agreement  Ran Oz

10-Q

001-33355

10.9A

May 15, 200810
.9*

Offer Letter Agreement  Maurice Castonguay

10-K

001-33355

10.10

March 12, 200810
.9A*

Transition Services Agreement  Maurice Castonguay

8-K

001-33355

10.9A

March 5, 201010
.10*

Offer Letter Agreement  David Heard

S-1/A

333-139652

10.7

February 26, 200710
.10A

Amendment to Offer Letter Agreement  David Heard

10-K

001-33355

10.11A

March 12, 200810
.10B*

Amendment to Offer Letter Agreement  David Heard

8-K

001-33355

10.11B

January 5, 200910
.10C*

Transition Services Agreement  David Heard

8-K

001-33355

10.10C

March 4, 201010
.11*

Offer Letter Agreement  Robert Horton

S-1/A

333-139652

10.12

January 26, 200710
.11A*

Amendment to Offer Letter Agreement  Robert Horton

10-K

001-33355

10.12A

March 12, 200810
.11B*

Amendment to Offer Letter Agreement  Robert Horton

8-K

001-33355

10.12B

January 5, 200910
.12*

Offer Letter Agreement  Sean Rooney

10-Q

001-33355

10.28

November 6, 200910
.13*

Letter Agreement  Harald Braun

10-Q

001-33355

10.26

May 7, 200910
.14*

Letter Agreement  Ken Goldman

S-1

333-139652

10.15

December 22, 200610
.15*

Letter Agreement  Robert Sachs

S-1

333-139652

10.16

December 22, 200610
.16*

Letter Agreement  Michael J. Pohl

10-Q

001-33355

10.27

May 7, 2009 88




---



##### Table of Contents



Incorporated by ReferenceExhibit





File

Exhibit



Filed WithNumber

Description

Form

Number

Number

Filing Date

This 10-K10
.17*

Letter Agreement  Dennis Wolf

10-Q

001-33355

10.29

November 6, 200910
.18A

Lease (475 Broadway, Redwood City, California)

S-1

333-139652

10.17A

December 22, 200610
.18B

First Amendment to Lease (475 Broadway, Redwood City, California)

S-1

333-139652

10.17B

December 22, 200610
.18C

Second Amendment to Lease (475 Broadway, Redwood City,
    California)

S-1

333-139652

10.17C

December 22, 200610
.18D

Third Amendment to Lease (475 Broadway, Redwood City, California)

10-Q

001-33355

99.1

August 10, 200910
.19

Lease (8 Technology Drive, Westborough, Massachusetts)

S-1

333-139652

10.20

December 22, 200610
.20

Lease Agreement (Tel Aviv, Israel)

8-K

001-33355

99.1

July 30, 200710
.20A

Amendment to Lease Agreement (Tel Aviv, Israel)

10-K

001-33355

10.24A

March 12, 200810
.20B

Sublease Agreement (Tel Aviv, Israel)

10-K

001-33355

10.24B

March 10, 200921
.1

Subsidiaries of the Registrant









X23
.1

Consent of Independent Registered Public Accounting Firm









X24
.1

Power of Attorney (included on signature page to
    Form 10-K)









X31
.1

Certification of Principal Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002









X31
.2

Certification of Principal Financial and Accounting Officer
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002









X32
.1+

Certification of Principal Executive Officer and Principal
    Financial and Accounting Officer pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002









X     +
    
    This exhibit shall not be deemed filed for the
    purposes of Section 18 of the Exchange Act or otherwise
    subject to the liability of that Section, nor shall it be deemed
    to be incorporated by reference into any filing under the
    Securities Act or the Exchange Act, whether made before or after
    the date hereof, except to the extent this exhibit is
    specifically incorporated by reference.*
    
    Management compensatory plan or arrangement 89




---



##### Table of Contents



SIGNATURES      By:
    /s/  Amir
    Bassan-Eskenazi  Amir Bassan-Eskenazi
 President and Chief Executive Officer
    Form 10-K, Form 10-K
  Signature

Title

Date/s/  Amir
    Bassan-EskenaziAmir
    Bassan-Eskenazi

President and Chief Executive Officer (Principal Executive
    Officer)

March 5, 2010/s/  Maurice
    L  CastonguayMaurice
    L  Castonguay

Chief Financial Officer)
    (Principal Financial and Accounting Officer)

March 5, 2010/s/  Michael
    PohlMichael
    Pohl

Chairman of the Board of Directors

March 5, 2010/s/  Harald
    BraunHarald
    Braun

Director

March 5, 2010/s/  Ken
    GoldmanKen
    Goldman

Director

March 5, 2010/s/  Ran
    OzRan
    Oz

Director

March 5, 2010/s/  Robert
    SachsRobert
    Sachs

Director

March 5, 2010/s/  Dennis
    WolfDennis
    Wolf

Director

March 5, 2010/s/  Geoffrey
    YangGeoffrey
    Yang

Director

March 5, 2010  90




---



##### Table of Contents



EXHIBIT INDEX
  Incorporated by ReferenceExhibit





File

Exhibit



Filed withNumber

Description

Form

Number

Number

Filing Date

this 10-K3
.1

Form of Amended and Restated Certificate of Incorporation of the
    Registrant

S-1

333-139652

3.1B

December 22, 20063
.2

Form of Amended and Restated Bylaws of the Registrant

S-1

333-139652

3.2B

December 22, 200610
.1*

Form of Indemnification Agreement

S-1

333-

10.1

December 22, 200610
.2*

2001 Share Option and Incentive Plan

S-1

333-

10.3

December 22, 200610
.3*

2003 Share Option and Incentive Plan

S-1

333-

10.4

December 22, 200610
.4*

2004 Share Option and Incentive Plan
    Sub-Plan for
    Israeli Employees

S-1

333-

10.5

December 22, 200610
.5*

2007 Equity Incentive Plan

S-1/A

333-139652

10.6

March 8, 200710
.5 A*

Form of Option Agreement (U.S.)

10-Q

001-33355

10.6A

August 8, 200710
.5B*

Form of Option Agreement
    (Non-U.S.)

10-Q

001-33355

10.6B

August 8, 200710
.5C*

Form of Restricted Stock Unit Agreement (U.S.)

10-Q

001-33355

10.6C

August 8, 200710
.5D*

Form of Restricted Stock Unit Agreement
    (Non-U.S.)

10-Q

001-33355

10.6D

August 8, 200710
.5E*

2007 Equity Incentive Plan
    Sub-Plan for
    Israeli Employees

10-Q

001-33355

10.6E

August 8, 200710
.5F*

Form of Israeli
    Sub-Plan
    Option Agreement

10-Q

001-33355

10.6F

August 8, 200710
.6*

Employee Stock Purchase Plan

S-1/A

333-139652

10.23

February 26, 200710
.7*

Employment Agreement  Amir Bassan-Eskenazi

S-1

333-139652

10.8

December 22, 200610
.7A*

Amendment to Employment Agreement  Amir
    Bassan-Eskenazi

8-K

001-33355

10.8A

January 5, 200910
.8*

Employment Agreement  Ran Oz

S-1

333-139652

10.9

December 22, 200610
.8A*

Amendment to Employment Agreement  Ran Oz

10-Q

001-33355

10.9A

May 15, 200810
.9*

Offer Letter Agreement  Maurice Castonguay

10-K

001-33355

10.10

March 12, 200810
.9A*

Transition Services Agreement  Maurice Castonguay

8-K

001-33355

10.9A

March 5, 201010
.10*

Offer Letter Agreement  David Heard

S-1/A

333-139652

10.7

February 26, 200710
.10A

Amendment to Offer Letter Agreement  David Heard

10-K

001-33355

10.11A

March 12, 200810
.10B*

Amendment to Offer Letter Agreement  David Heard

8-K

001-33355

10.11B

January 5, 200910
.10C*

Transition Services Agreement  David Heard

8-K

001-33355

10.10C

March 4, 201010
.11*

Offer Letter Agreement  Robert Horton

S-1/A

333-139652

10.12

January 26, 200710
.11A*

Amendment to Offer Letter Agreement  Robert Horton

10-K

001-33355

10.12A

March 12, 2008 91




---



##### Table of Contents



Incorporated by ReferenceExhibit





File

Exhibit



Filed withNumber

Description

Form

Number

Number

Filing Date

this 10-K10
.11B*

Amendment to Offer Letter Agreement  Robert Horton

8-K

001-33355

10.12B

January 5, 200910
.12*

Offer Letter Agreement  Sean Rooney

10-Q

001-33355

10.28

November 6, 200910
.13*

Letter Agreement  Harald Braun

10-Q

001-33355

10.26

May 7, 200910
.14*

Letter Agreement  Ken Goldman

S-1

333-139652

10.15

December 22, 200610
.15*

Letter Agreement  Robert Sachs

S-1

333-139652

10.16

December 22, 200610
.16*

Letter Agreement  Michael J. Pohl

10-Q

001-33355

10.27

May 7, 200910
.17*

Letter Agreement  Dennis Wolf

10-Q

001-33355

10.29

November 6, 200910
.18A

Lease (475 Broadway, Redwood City, California)

S-1

333-139652

10.17A

December 22, 200610
.18B

First Amendment to Lease (475 Broadway, Redwood City, California)

S-1

333-139652

10.17B

December 22, 200610
.18C

Second Amendment to Lease (475 Broadway, Redwood City,
    California)

S-1

333-139652

10.17C

December 22, 200610
.18D

Third Amendment to Lease (475 Broadway, Redwood City, California)

10-Q

001-33355

99.1

August 10, 200910
.19

Lease (8 Technology Drive, Westborough, Massachusetts)

S-1

333-139652

10.20

December 22, 200610
.20

Lease Agreement (Tel Aviv, Israel)

8-K

001-33355

99.1

July 30, 200710
.20A

Amendment to Lease Agreement (Tel Aviv, Israel)

10-K

001-33355

10.24A

March 12, 200810
.20B

Sublease Agreement (Tel Aviv, Israel)

10-K

001-33355

10.24B

March 10, 200921
.1

Subsidiaries of the Registrant









X23
.1

Consent of Independent Registered Public Accounting Firm









X24
.1

Power of Attorney (included on signature page to
    Form 10-K)









X31
.1

Certification of Principal Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002









X31
.2

Certification of Principal Financial and Accounting Officer
    pursuant to Section 302 of the Sarbanes-Oxley Act of 2002









X32
.1+

Certification of Principal Executive Officer and Principal
    Financial and Accounting Officer pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002









X     +
    
    This exhibit shall not be deemed filed for the
    purposes of Section 18 of the Exchange Act or otherwise
    subject to the liability of that Section, nor shall it be deemed
    to be incorporated by reference into any filing under the
    Securities Act or the Exchange Act, whether made before or after
    the date hereof, except to the extent this exhibit is
    specifically incorporated by reference.*
    
    Management compensatory plan or arrangement 92