Laura Hamilton
Google certainly got the buzz machine humming a couple weeks ago with its announcement that it plans to build and test ultra high-speed broadband networks in a small number of trial locations across the United States. As you’ve no doubt heard, the company says it plans to deliver Internet speeds more than 100 times faster than what most Americans have access to today with 1 gigabit per second, FTTH connections.
“We plan to offer service at a competitive price to at least 50,000 and potentially up to 500,000 people,” Minnie Ingersoll and James Kelly, Google product managers, posted in a blog.
What that competitive price ends up being obviously remains to be seen. Sure, downloading a high-def, full-length feature film in less than five minutes or watching a 3D video of a university lecture would be very cool, but what will subscribers in the real world, beyond trials, actually pay on a regular basis to do that? While Google was careful to stress that what it wants to do is “experiment” and “trial,” it’s hard to imagine other service providers quickly jumping on any kind of ultra high-speed bandwagon if consumers don’t show a willingness to open their wallets to ensure a solid ROI.
Subs invariably want faster and faster speeds. But paying for that is sometimes another matter. One way of gauging this is to check out the blogosphere right after a major rollout by a cable op of DOCSIS 3.0. Often, bloggers will wax poetic about the new wideband speeds they’re being offered, but many will complain openly about the additional price tag.
But pricing issues aside, Google’s plan to test new ways to build fiber networks is going to be fascinating to watch. And the lessons learned will be a great benefit to cable operators — who’ll most certainly be at the forefront when the real-world ultra high-speed evolution ensues.
Laura Hamilton is editor-in-chief at BGR. Email her at laura.hamilton@comcast.net.
Last month, Broadband Gear Report asked a variety of vendors that serve the cable industry what they thought 2010 might hold for the cable engineering community. The issues surrounding DOCSIS 3.0 were particularly sizzling — especially topics that touched on its upstream channel bonding capabilities and cable operators’ commitment to deploying them in a major way. (If you want to check out our 2010 preview two-part article, you can read it here: 
On Dec. 15, 2009, the U.S. House of Representatives passed H.R. 1084, the Commercial Advertisement Loudness Mitigation (CALM) Act. The bill will require the FCC to prescribe a standard to keep commercials from being broadcast louder than the programs they accompany. The CALM Act also makes specific reference to an ATSC Recommended Practice: “Techniques for Establishing and Maintaining Audio Loudness for Digital Television,” which is applicable to television broadcast stations, cable operators and other multi-channel video providers.
Even in relatively easy economic times, it’s incredibly difficult to predict what’s coming next when it comes to the future of cable technology. And while it may be more fun to gaze into the crystal ball during a period of plenty, it’s often a more fascinating process to do the same thing when budgets are tighter.
This current frigid economic winter of discontent doesn’t exactly provide a perfect reason for cable engineers to dream of immediate advanced service rollouts and big steps forward in technological gear. Rather, it seems that MSOs will probably see fewer voice, video and high-speed data subscriptions in 2009 in the midst of a deteriorating U.S. economy. Be that as it may, extensive technical stagnation isn’t likely given that cable engineers still have to deal with the realities of serious competition, the DTV transition and advanced architectures that have already started to roll.
Engineering Considerations for Pleasing the Picky Business Services Customer
Laura Hamilton
After all, many of these SMBs depend completely on their voice and data services to ensure they really get their business done every day. So, while there’s not denying that cable ops are expanding into this market from their residential base, this is not residential service. If you think your residential customers are unforgiving, then imagine what a small business sub would be like if his voice or data went down for several hours.
Reaching Out to Businesses
But the bottom line is that MSOs currently have solid networks in place to supply a huge variety of business customers with a wide range of quality voice and data services. They’re sitting right along cable’s networks, and perhaps the best proof that cable understands the vast potentials of its networking prowess to serve SMBs comes from recent reports that it plans to beef up its workforce to reach out particularly to those customers.
Take some of the latest word from Comcast CFO Michael J. Angelakis at a Morgan Stanley Technology, Media & Telecom conference earlier this month wherein he said the op could hire 500 people this year in business services (according to an article in the Philadelphia Inquirer). Angelakis said the new hires would mostly take aim at companies that have about 20 employees. “There’s [also] a very large market with some real pent-up demand, with real need for high-bandwidth, really good services, and that’s in the zero-to-a-couple-hundred employee companies,” he said at the confab.
Of course, making those kinds of proclamations to the financial community generally means you had better have the engineering muscle to back it up. The good news for Comcast, and really, cable operators in general, is that doesn’t look like a problem.
Robust Systems
John Dahlquist, vice president of marketing at Aurora Networks (www.aurora.com) is quick to point out to BGR that cable operators already have robust networks in place to support a vast array of commercial services to companies of many sizes. “With the right solutions in place, such as GEPON and RFoG for fiber infrastructure or fiber deep and digital return for increasing bandwidth, cable operators can offer affordable yet very high speeds to businesses through networks that provide reliable and scalable services,” he says.
“Cable operators don’t need to build, maintain and manage separate networks or multiple platforms and backoffice software to deliver commercial services. Cable operators can have the greatest impact by providing reliable, advanced commercial services at competitive prices. They can do that best by utilizing the network resources they already have in place.”
Dahlquist explains that this not only minimizes the cost to deploy, but also reduces the time to deploy given that so much of the needed solution is already in place today.
Also calling out cable’s unique current positioning in the business services arena is Rafael Fonseca, VP of systems engineering and technical marketing, at Cedar Point Communications (www.cedarpointcom.com) in a recent conversation with BGR. As cable converges its networking capabilities with IP technology and builds further on its capabilities of a single network for all services, it leverages its technical advantages against competitors from both an OPEX and CAPEX standpoint, he says. Add in the converging nature of backoffice technologies, and cable gains even more distinctive advantages, he believes.
Keeping Costs Down
In the end, SMBs – and companies of any size for that matter – progressively want more bandwidth, but they increasingly demand it at a lower cost. So a key factor in all this for any cable operator is going to be providing that while keeping its own operating expenses down as well.
“If cable operators can keep their operating costs low, they can pass any savings on to the customer,” Aurora’s Dahlquist points out. “Reducing OPEX and gaining greater efficiencies within the network also frees up cable operator resources for other services or areas of operations that can benefit customers.”
Dahlquist puts it simply when he says that cable operators can win commercial customers with services that are robust, reliable and competitive with similar services offered by competitors. He believes that inherently, by eliminating amplifiers from the network, cable operators are driving fiber deeper, ultimately passing more potential commercial customers. This increases the commercial footprint that can be served from their residential network, providing a lower capital cost for signing up a new commercial customer, he concludes.
“As cable operators study how they can evolve their networks for the delivery of commercial services, they can look to cut costs and improve efficiency, such as eliminating amplifiers in the network,” Dahlquist adds. “And by reducing active network elements, cable operators minimize plant maintenance and gain significant savings with a reduction in network power costs.”
And of course, those savings can be passed on to the business customer, who’ll be very happy to take those dollars, thank you very much.
Stress Tests
An obvious gorilla in the room you need to immediately address when talking about business services involves resiliency and redundancy in the cable network. “Businesses generate revenue by having services up all the time,” Cedar Point’s Fonseca stresses. “Outages translate directly to their bottom line.”
To that end, Fonseca describes an interesting point that some operators may not think of when first addressing any one particular SMB, and the unforeseen stresses that customer could ultimately place on the cable system. That is, at certain times, there could be a significant increase in network traffic based on the type of business being served. The operator must engineer its business services with the reality in mind that it could be serving a subscriber that has exploding voice and data needs around a particular time of year or a particular event – say Mother’s Day or the holiday season, for example.
Those kinds of issues are the reason that all the different entities within a cable op must be in alignment before it gets its feet wet in business services, points out Cedar Point Director of Marketing Jim Gayton. So, sales, marketing and training all need to work together closely from Day 1 to anticipate these potential problems and prepare for them before they’re experienced by the customer.
By many accounts, U.S. MSOs are making all the right moves to attract more and more small- and medium-sized business customers, and that could ultimately lead to even bigger commercial customers. In fact, a good indicator of all these kind of potentials is perhaps just over the Atlantic. Cedar Point’s Fonseca recently sat on a panel at the Cable Congress in Brussels, and reports that during that session, Virgin Media said it was getting around 10% of its total business from commercial customers. The opportunities behind those kind of numbers certainly has to appeal to U.S. operators, which already have powerful networks in place to reach a large mass of currently underserved business customers.
Laura Hamilton is editor-in-chief at BGR. Email her at laura.hamilton@comcast.net.