The War Drones Between Cable Operators and Telcos


The common wisdom is that cable operators use a dab of fiber, but rely primarily on coaxial cable. Telcos use a combination of copper and fiber. Never the twain-or the wires-shall meet. While it contains a good deal of truth, this is a simplistic understanding, particularly in the case of cable technology.


Cable operators want to get fiber as close as possible to homes and businesses, but must find a way to do so that strands as little of their investment as possible. Cable Digital News reports that Time Warner Cable is moving stronger than ever in that direction. The company has released a request for information on fiber-to-the-home approaches for unwired ("greenfield") areas, multidwelling units and commercial customers.


The story has a good overview of the situation. The bottom line is that the cable industry is perfectly willing to use fiber where it makes sense. In fact, fiber-to-the-premise makes so much sense that the industry has a standard-RF over Glass (RFOG, a great acronym to boot) -- on which it is working. The goal of the initiaive is to use fiber in a way that doesn't strand investment in its current coaxial cable-based infrastructure.


The cable industry's answer to fiber-when it isn't using fiber itself, of course-is the third iteration of the Data Over Cable Service Interface Specification (DOCSIS 3.0). This CED piece says that Comcast, the nation's largest cable operator, met its 2008 goal of having the standard deployed in 20 percent of its footprint. It now, according to the story, has DOCSIS 3.0 in 35 percent of its cable modem termination systems (CMTSes). The piece reports on a Comcast engineer's comments that the company is adding DOCSIS 3.0 to 100 CMTSes per month. The story says the top speeds now are 50 megabits per second (Mbps) upstream and 10 Mbps down. Those speeds may increase, the engineer said.

Stats on which service provider offers marginally faster service invariably are more interesting to the competitors than to consumers or businesses looking at the bigger picture to find the best company with which to partner. Following the metrics in general, however, provides a good way to track the overall maturation of the various players and their industry segments.

In late January, Charter Communications beat Verizon's FiOS and AT&T's U-Verse-and not to mention Comcast -- by introducing the DOCSIS 3.0-based Ultra60 service in areas of the St. Louis market. The service offers 60 Mbps downstream and 5 Mbps upstream service. The service isn't cheap: It costs $139.99 a month as a standalone service and $10 less if it is in a bundle. In a rather distressing side note, the story says Charter seems likely to go bankrupt.

The assumption made by many is that the sophisticated networks-either made of fiber or coax-will be built. That's not always certain, however. This Telephony Online post by Carol Wilson presents the views of Benoit Felten, a Yankee Group analyst and comments on them. Felten says that the recession will slow investment and provide regulators with the opportunity to develop cogent open-access policies. The fear is that providing incumbents too much control over access will stifle competition, but mandating to open a network will be a disincentive for them to invest. Felten and Wilson agree, however, that incumbents' fears of open access are overstated. Once they build the network, it will be impossible for incumbent operators to fill them all by themselves. Thus, the existence of wholesale business opportunities will end up being to their advantage.

The more things change, the more they stay the same. That's the message of this amusing item at DSL Reports. It outlines the sniping between Charter and Verizon over the operator's move to DOCSIS 3.0 in St. Louis. The irony is that the two industries have been saying more or less the same thing about each other for more than a decade, even as the technology about which they argue evolves. The telco always points out that cable is a shared medium in which many premises draw from the same reservoir of bandwidth. The cable companies respond that their legacy gear-coaxial cable-is still viable, just for shorter distances. They say that is a big advantage compared to telcos' copper, which has to be replaced.


There is a tremendous amount of activity in the cable and telco arena. VoIP, IPTV and other IP-based interactive service are a brave new world that are both very promising and very threatening. The industry segments will continue to simultaneously compete against each other and struggle to find the bests way to package their services.