Telecom Players Throw a House Party

Carl Weinschenk

The cable industry has long known one thing: Its last mile coaxial cable into or near the majority of American's homes makes it a winner. Indeed, it can be argued that that cable was at the genesis of the broadband revolution and is driving the escalating battle between cable operators and telephone companies.


This press release, which hypes an In-Stat report, is another piece of evidence -- along with possible WiMax deals -- that suggests the direct broadcast satellite (DBS) industry has gotten the message. It is adding a large number of services to its set top boxes (STBs) that compete with cable and telco service platforms.


All we can say is that it is a good time to be a customer. The features being added to the satellite STBs referenced in the In-Stat study support consumer-oriented services such as high definition video and digital video recording. This will be a tough road for the DBS players, however. STBs aren't the cable industry's only device in the home. Cable modems -- with and without active VoIP functionality -- also are there, likely in another part of the house or apartment. All of these widgets can talk to each other, of course.


In any case, a three-way battle is joined: satellite companies, cable operators and telcos. A key issue will be where the consumer part of the home ends and the home office/small office and telecommuter area begins. The line is fuzzy -- and increasingly meaningless. The target is the home, and the game plan is to fully serve both consumer and business constituencies.


That's been a cable goal for a decade or more. What may not be as well known is how good a job the industry has done in laying the ground work. The industry, through Cable Television Laboratories Inc. -- CableLabs, the operators' R & D consortium in Colorado -- has established a flexible framework into which just about any gadget can fit. It can mix and match various pieces of functionality in a creative manner -- including femtocells -- which can enable wireless voice service.


This is all good. Telecommunications surely is in a free-for-all. Cable operators' phone services are exploding and the telcos suddenly are purveyors of entertainment video. The winners will be consumers and small businesses.

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