Broadband

Cable-Tec Expo: CTOs Share Hard Truths With Vendors

Industry urged to pursue new virtualized, software-driven network models because revenue growth and capacity demands are way out of step 9/27/2016 4:26 PM Eastern Last updated at 9/29/2016 8:02 AM
Left to right: Liberty Global's Balan Nair, Charter's Jim Blackley and Shaw's Zoran Stakic. Photo credit: JohnStaleyPhoto.com

PHILADELPHIA – A panel of some of the industry’s top engineering executives shed some important light on why distributed architectures and the shift toward the software-driven, virtualization of network functions have rapidly become major priorities for MSOs around the globe.

 

Boiled down: Old models, driven by purpose-built hardware, simply won’t work anymore.

 

There’s a huge “disconnect” between the data that people are consuming and what cable operators must spend in order to keep up with that demand, Balan Nair, executive vice president and chief technology officer of Liberty Global said in a wide-ranging panel session that was moderated by Bob Stanzione, executive chairman and board chairman of Arris.

 

As network capacity planning goes, Liberty Global is already allocating enough capacity to deliver an average of about 1 Mbps per sub. With annual capacity growth in the range of 30% to 40% per year, it won’t be long before that hits 2 Mbps per sub.

 

STATUS ‘NOT SUSTAINABLE’

That would equate to about 25 8MHz-wide channels at Liberty Global, or “like half of our whole plant,” Nair said, noting that this trend causes MSOs to keep “feeding this beast” with capital just to expand capacity to stay ahead.

 

“That’s a problem for all of us,” he said. “That’s not sustainable.”

 

And it doesn’t add up with a business that grows revenue at 4% to 5% per year. “Eventually, it breaks,” Nair said. “The math will never work.”

 

The historic practice of buying specialized devices from traditional suppliers that cost a lot to build and buy won’t work anymore. “That model has to change,” Nair said.

 

The shift is toward cheap, commodity hardware running on very specialized software.

 

“So, we’re going to ask our vendors to think about the software and to run it on some cheap hardware because, at the current rate, it's not sustainable,” he said.

 

Vendors appear to have gotten that message loud and clear. Just this week, Nokia, Casa Systems and Harmonic all announced virtualized versions of Converged Cable Access Platforms that can work in tandem with distributed architectures that move away from traditional monolithic access devices.

 

Fellow panelist Jim Blackley, EVP, engineering and IT at Charter Communications, called Nair’s characterization of the situation “spot on and accurate.”

 

He added that, when it comes to capital, “you can’t spend it everywhere. … You can't spend it in the home and spend it in the network and spend it on content and all of the other things we need to deal with."

 

He said it’s important to think about virtualizing the functions of the consumer premises equipment (CPE) and move the compute, storage, encryption, and packaging into cloud-based centralized systems.

 

Charter is moving in that direction with ActiveVideo (a vendor it owns as part of a joint venture with Arris). Virtualizing the CPE means "you can put out devices that will last longer,” Blackley said. “The reality of our business is, the day you [deploy] something, it's legacy."

 

He said Charter was a “huge fan” of network virtualization and separating out the MAC and PHY elements.

 

Zoran Static, EVP and CTO of Shaw Communications, said he’s also keying on these trends and listening to partners on “how the future is going to land.”

 

But when it comes to a move toward virtualization, “the starting point becomes remote PHY,” he said. “The old model is not sustainable. It’s not a choice really, anymore.”

 

Nair called the shift to software-driven models as one of his top worries. “It requires a skillset change in all of our businesses,” he said. “The change is not just the skillsets in our employee base, but the skillsets of our vendor base as well."

 

Vendors, meanwhile, prefer to innovate on their own platforms. Interests of the two sides might not match up and could become a source of tension.

 

Nair thinks it’s best to solve that problem, “or else you're going to see more and more operators building their own stuff, and that won't be very good for the industry."

 

The early part of the talk centered on the move toward Gigabit-level broadband – something that has become a table stakes option for consumers who need it, or at least think they need it.

 

But Nair doesn’t see 1-Gig going “mainstream” until 2018 or 2019. By that, it won’t become a “bullseye” product for Liberty Global that is backed heavily by marketing and promotion. Today, that’s relegated to the operator’s 250 Mbps product, he said.

 

“We’re looking at increasing it,” Nair said, noting that MSOs have the luxury to press two levers with broadband – price and speed – while competitors with less robust networks can only fiddle with price. “Speed wins.”

 

Blackley said Charter is already getting positioned for the 1-Gig future. Its all-digital migration is freeing up capacity and Charter is also plunging fiber deeper into the network.

 

He added: “It’s not just about speeds; it's about latency, and it's not just about in-home; it's out of home.”

 

Blackley hesitated to say when consumers will actually need 1-Gig speeds, but won’t be surprised to see it happen eventually. "Like your garage, if you build it, it will get filled,” he said.

 

‘IRRATIONAL’ GOOGLE MOVES

Stakic, meanwhile, warned against “irrational behaviors” occurring in the United States, largely “triggered by Google,” that might cause MSOs to rush prematurely to 1-Gig.  He questioned if adoption rates will be high enough to justify the returns, noting that there aren’t many apps now that require three-digit megabit speeds at this point, let along 1-Gig.

 

Nair said the challenge of getting gigabit to the home pales versus getting gigabit support inside the home with WiFi. “The cost of WiFi now is actually more expensive on a per subscriber basis than DOCSIS,” he said.

 

The panel dove deeper into wireless and mobility now that Comcast and Charter Communications are both looking to put their MVNO agreements with Verizon in play.

 

Blackley said having an MVNO deal won’t prevent Charter from having to bulk up its own network with denser WiFi and backhauling capabilities.

 

“Wireless is just an extension of the wired network, and our consumers want their products where they are..and we have to have a network that will support that with economics that make sense." 

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