Cisco Blogs
Share

The Cable Story, Part 1: Is that light at the end of the tunnel a train, or sunlight?

- June 4, 2018 - 0 Comments

To a certain degree, the cable industry invented the service provider market as we know it today. With us for over 60 years now, it can be considered an ‘old’ industry, certainly in today’s dynamic world.

Luckily for them, they have the opportunity to reinvent themselves, to change, to adapt, to revolutionize how they operate and drive the next wave of network service innovation.   The cable industry is undergoing a major transformation.

Let’s face it: The days of the “captive audience” and “walled gardens” are over, and the cable business is under continual attack. Just as voice services were conquered long ago, and came to be more of a cost factor, the same thing is slowly happening on the video front. New providers, locally and globally, are getting into consumer houses, initially as an add-on to cable video services, but very quickly creating high churn rates. High speed broadband services, on the other hand, are flourishing, but there is a fly in the ointment there, too, because that same enhanced pipe is what opened the door for over-the-top (OTT) video competition.

None of this is really new. What’s new is a bright and clear understanding that unlike other service providers, cable providers are in unique position. They built and maintain a valuable competitive asset – the cable network, robust and dense, with the lowest cost-per-bit in the SP sector. Actually, data shows a 60% difference in cost-per-Mbps-per-service area in favor of the cable infrastructure (vs. GPON). And when we talk about density, then cable is by far the densest network, certainly in the U.S., where almost every household (over 146M!) is passed by Cable.

All of this gives cable providers a window of opportunity to truly take advantage of this asset and to shape their future trajectory. It is a window that will be open for a limited amount of time, given that Telco’s with fiber will catch up — but it certainly gives cable an advantage of few years.

This will only come with a few immediate steps on the cable providers’ side:

  • Reinventing the cable network
  • Monetizing the pipe
  • Automating the network.

Each step deserves its own discussion, so I will dedicate a special post to each one of them.

By taking these steps, cable providers can expect to achieve critical business outcomes, gaining the velocity and the agility they need — approaching the model of the web industry that is slowly getting into their business. Studies continue to emerge that indicate that for each dollar spent on capital expenditures (CapEx), service providers are investing an additional $3 in operational expense (OpEx), so, controlling CapEx while reducing OpEx is vital. And, protecting both footprint and profitability means a healthy business that continues to grow.

All these are decidedly tactical advantages, but the true benefit is strategic. Taking these steps will continue to position cable as the network of the new age, and will assure the cable providers’ competitive future.

So the light at the end of the cable tunnel is not the lamp of an oncoming train, but indeed a ray of sunshine. If, that is, the right steps are taken right now.

Read more about Cisco’s cable access solutions

 

Tags:
Leave a comment

We'd love to hear from you! To earn points and badges for participating in the conversation, join Cisco Social Rewards. Your comment(s) will appear instantly on the live site. Spam, promotional and derogatory comments will be removed and HTML formatting will not appear.