Internal CableLabs Report Sparks Stir
By Karen Brown -- Multichannel News, 8/17/2006 9:33:00 AM
An internal CableLabs report obtained by the Wall Street Journal that suggests that cable operators will have to shell out money for fiber-to-the-home upgrades generated some disagreement from the industry Thursday.
The story, based on a July 31 research report produced at the cable technology consortium, claimed that cable operators may not be able to rely on their hybrid fiber-coax networks to keep bandwidth pace with telco fiber-to-the-premise services, most notably by Verizon.
"At some point, optimization of the (cable) network becomes more expensive than simply deploying" fiber directly to homes, the Journal story stated.
But the story does not accurately reflect the overall conclusions and tone of the report, according to a review of a copy of the report belonging to an industry engineer. According to the engineer, the report indicates that while it indicates that at some point the cost to efficiently maintain hybrid-fiber coax does become more expensive than deploying fiber-to-the-home, that point only comes when the node size – the number of coax-connected homes served by a fiber node – falls below 125 homes. At present, cable operators typically design nodes to serve 500 homes.
In all, rather than painting a black picture for cable networks, the report is more even-handed, indicating that cable technology will be able to keep pace with competitors at least for the next three years. After that improvements to cable technology will be able to keep pace with broadband fiber-to-the-home rivals, but only if the cost of cable modem termination systems fall to make the cost to revenue numbers work. If not, cable operators might have to consider fielding fiber-to-the-home networks, according to the report.
In a statement, CableLabs noted that the confidential report cited by the Journal was one of a series of research papers it regularly provides to members.
"The report shows that no major investment is needed for cable to compete with FTTP networks. In addition, the document suggests a long range approach to address the potential future competitive demands on the cable network into the next decade," it said.
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