Channeling the Future
Operators Careful to Start On the Right Foot
By Todd Spangler -- Multichannel News, 11/18/2007 7:00:00 PM
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Cable has been arming itself with a weapon intended to help neutralize DirecTV’s high-definition blitz: switched digital video.
Long term, the technology is a step toward cable TV services evolving into an “everything on demand” infrastructure, able to deliver any content at any time — the ultimate personalized television experience.
But the hopes for 2007 as the breakout year of switched digital video have faded, as the technology appears to be taking longer than some operators expected to commercially roll out.
Comcast, for example, in January said it expected to deploy switched digital video in the second half of the year. But the technology in early November remained in trial mode at the operator’s two test locations: Denver and Cherry Hill, N.J. (Comcast senior director of corporate communications Jenn Khoury declined to provide details on specific switched digital deployment plans, citing competitive reasons.)
Charter Communications had two market trials this year and “continues to plan on major deployments in 2008 and 2009,” said spokeswoman Anita Lamont.
To be sure, a few operators have gone live with switched video, including Time Warner Cable in select divisions and Cablevision Systems, which has deployed it throughout its three-state New York metro area footprint.
BigBand Networks, the first vendor with a switched digital video solution in the market, said its system is currently being deployed or has gone live in systems covering 11 million to 12 million homes passed, with more than 6 million of those in commercial operation.
Meanwhile, SA has claimed to be in prelaunch deployments in systems at Time Warner Cable and others for a total of more than 7 million homes passed, and Motorola said it is working with Comcast and two unnamed cable operators.
For the most part, though, the switched digital video action that was expected this year has yet to come to pass. “There’s a lot of work going on, that’s for sure,” RGB Networks vice president of product development Ramin Farassat said. “But we were obviously expecting to see [switched digital video] pick up much faster.”
Some operators said they don’t have an urgent competitive need to deploy switched video right away.
“We don’t have a short-term crisis with respect to high-definition video, although looking out on the horizon a couple years out we need to be prepared for that,” Suddenlink Communications vice president of advanced technology Gregg Grigaitis said.
Suddenlink, which has about 1.4 million customers in eight states, hopes to test out switched digital video in one market in the third quarter of 2008, he said.
Grigaitis also said the operator has held off because some elements of switched digital video still seem “nascent.”
“We’d like to see a little more maturity in the products over the next six months before we roll that out,” he said, noting that most deployments to date have been based on BigBand equipment in Scientific Atlanta environments. Suddenlink’s set-top box breakdown is roughly 60% Motorola and 40% SA.
| * Pricing per set-top box NOTE: Estimates exclude costs for infrastructure improvements that may be necessary to deploy SDV, such as expanding shared facilities with additional Gigabit Ethernet switches for video transport. SOURCE: Scientific Atlanta |
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| Homes passed | 1,028,000 |
| Digital set-tops | 432,000 |
| Switched video QAMs per service group | 8 |
| Service group size (tuners served, per node) | 1,000 |
| Headend switched video components* | $0.71 |
| Switched video servers* | $4.50 |
| QAMs* | $6.70 |
| Services and training* | $1.90 |
| Cost per set-top | $13.81 |
| Cost per home passed | $5.80 |
| Total budget | $5,964,682 |
Switched digital video sends a channel to a subscriber only when it is requested, unlike regular broadcast video that is sent to every subscriber’s set-top box whether someone is watching it or not. Switched video systems are typically set up so that, according to historical viewership patterns, fewer than half the channels in a switched group will be viewed at any given time.
The potential bandwidth gains with switched digital video are significant. It allows an operator to pump out twice the number of channels, or even more, in the same amount of digital shelf space. Using the technology to deliver, say, a cable system’s 80 least-watched channels in space normally needed for 40 frees up enough space for at least eight new HD channels.
The caution on the part of cable operators — to offer no switched digital video before its time — is the result of an imperative to ensure that a subscriber’s experience of turning on the TV and surfing through a lineup of 300-plus channels remains exactly the same as it has always been.
If a switched video stream is blocked, in some ways that’s more serious than having a video-on-demand service. “These are channels I’ve already paid to watch,” Harmonic director of cable solutions and strategy Gil Katz said. TV is a cable operator’s core business, he noted: “They can’t take risks here. You have to be very careful and not damage that.”
Tuning to a switched digital video stream requires several pieces of a cable system to work in harmony. When Joe Six-Remote clicks to a switched channel (say, channel 707), the set-top box issues a request for that channel back upstream to a switched video server in the headend.
The server keeps track of which channels are already in play, and removes those that are no longer being watched from the rotation. If 707 isn’t already being distributed in Joe’s neighborhood, the server requests the content and reserves the necessary spectrum to deliver it.
An operator needs to constantly monitor the switched channels, from source to set-top, to make sure they’re working as advertised, said Jeff Taylor, director of product strategy and management for SA’s subscriber network systems group.
“With broadcast you had to make sure 250 programs got to the set-top. Now you have 160 channels switched, and you need more sophisticated diagnostic tools to make sure those channels are being fulfilled,” he said.
Some operators may have “underestimated the amount of systems integration required on this stuff,” C-COR senior vice president of global advanced technologies Joe Matarese said. “There’s a lot of complexity with this issue. There are just a lot of moving parts.”
No one-size-fits-all approach is possible with switched digital video configurations. “A lot of little things differ from system to system,” said Biren Sood, vice president and manager of BigBand’s cable video business unit. “Given the nature of [switched digital video] and the fact that it’s at the heart of the network, variations will naturally exist and you have to be able to operate in those environments.”
Systems such as those currently offered by BigBand and SA are “open,” in the sense that their components should be able to work with those from other vendors. Two de facto standard sets of protocols, established by Time Warner Cable and Comcast, define these functions; for example, how switched video session management software communicates with edge quadrature amplitude modulation (QAM) systems.
Today, though, “we think almost all the current [switched digital video] deployments are proprietary solutions,” said Jeff Brooks, senior director of business development for Arris’s broadband group. “Most of the open-interface solutions are coming up right now. We think next year is going to be a really important year in this space.”
In multivendor environments, getting every link in the switched video chain running smoothly has taken time. On the other hand, noted Harmonic’s Katz, “you can be sure the vendors are very motivated to get this to work, because of the business opportunity. We prefer to do that in each other’s labs before we get to the customer’s lab.”
According to C-COR’s Matarese, one of the final pieces operators are still getting their arms around in switched digital video systems is the software in set-top boxes that runs the on-screen interactive program guides.
“Getting new releases of the guide applications out the door is something that takes a fair amount of time,” he said.
For BigBand, the complexity involved in deploying switched digital video was one of the factors that led to the company missing revenue expectations for the quarter that ended Sept. 30. In the third quarter, BigBand reported revenue of $38.5 million — compared with its previous guidance of $54 million to $58 million.
According to BigBand, one of the primary factors that contributed to the earnings miss was that switched digital video deployments “have required more software customization and integration than originally expected,” preventing the company from recognizing sales from certain customers.
In any case, BigBand can still lay claim as being the leading switched video vendor. Its products are being used by Time Warner, Cablevision, Cox Communications and two other unnamed North American operators for a total of 20 cable systems. In addition, Comcast has approved BigBand as a supplier of switched video session management software.
While some operators are still in prelaunch mode, those early adopters that have flipped the switch are already moving to put additional content into the switched tier.
Several systems that have deployed BigBand are delivering more than 100 channels via switched digital video. Also on the rise are oversubscription rates, the ratio of switched channels to the number that would fit into the same bandwidth using conventional broadcast, according to BigBand’s Sood.
After starting with a relatively conservative 2-to-1 ratio, operators are at 4-to-1 oversubscription in some cases with the addition of niche-oriented content, such as in-language ethnic programming. “It’s a function of operators being more comfortable with the technology, but also the long-tail niche services being made available,” said Sood, noting, “As you expand programming in the switched tier, each program becomes less popular.”
In addition, operators are now putting HD channels into the switched mix, “approaching double digits in some of the systems we’ve deployed,” Sood said.
SA’s customers are typically designing switched digital video for 2-to-1 oversubscription and moving between 160 and 200 standard-definition channels to the switched tier, said Greg Hardy, vice president of business development for SA’s transmission network systems. The net bandwidth recovery is between 8 and 10 QAMs, or enough space for 20 to 30 HD broadcast channels, Hardy said, noting that some high-definition programs may also go into the switched tier.
The cost of deploying switched digital video is lower than some other bandwidth-saving or expansion techniques, such as upgrading plant to 1-Gigahertz or adopting more-efficient MPEG-4 video compression. Suddenlink’s Grigaitis pointed out that shrinking the analog-channel tier is also a potentially inexpensive way to free up capacity, although he acknowledged that such pruning may create a customer-service issue.
SA estimates switched digital video project to be an average of $8 per home passed, though Hardy noted the cost will be higher in systems with service-group sizes of fewer than 500 tuners.
“HD is really the key,” Hardy said. “It’s about how I can get HD up quickly by using the bandwidth recovered from switched digital video.”
Switched digital video, besides carving out near-term bandwidth, also paves the way for a future in which all TV programming is delivered on demand, according to industry executives.
A switched video system, after all, is essentially a way to deliver linear TV on demand. To think of it in another way, switched digital video is like a network-based digital video recorder “that doesn’t cache anything,” C-COR’s Matarese said.
Eventually, the thinking goes, cable networks will move from today’s delivery model (most of the same live programs delivered to many households) to providing entirely unicast streams, where every subscriber may be watching a personalized piece of video at any given time.
The holy grail is to exploit the targeted-advertising possibilities of delivering a TV service tailored to each and every subscriber. Whereas ads on linear TV must be flung to thousands of people, a unicast video stream theoretically can be matched, Internet-style, with marketing messages that mesh perfectly with a viewer’s demographic profile.
“Once you move to a switched unicast platform, you can take advantage of addressable advertising,” Motorola director of product management Bruce Bradley said.
Matarese noted that an all-unicast environment will require a large number of new edge QAM devices. A cable system with 1 million digital set-tops, with a peak utilization of 60% concurrent viewers, would need 60,000 edge QAMs to deliver a unique standard-definition video stream to every subscriber.
“It winds up being a fairly large system in terms of the edge QAM devices,” Matarese said. “Ultimately, it’s going to take a while to get to that point.”
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