In recent months, a video variant of Moore’s Law seems to have taken hold in the high-definition television world, with cable operators, telcos and satellite providers scrambling to exponentially expand their HD offerings.
Only two years ago, pronouncements about offering 150-plus high-definition linear channels or 1,000 HD titles on demand would have been greeted with skepticism, if not derision. Now, Comcast and Verizon Communications are on schedule to offer 1,000-plus HD titles by the end of the year, and Cox Communications is in the midst of a dramatic expansion of its video-on-demand capacity that will give it shelf space for over 1,000 hours of HD content on demand.
And, more is on the way, putting potentially huge pressures on available bandwidth.
“With regards to video, there is obviously a battle over who has more HD than the next guy and that dynamic is only going to accelerate,” said Floyd Wagoner, senior director of global marketing and marketing communications for Motorola’s Access Networks Solutions division. “VOD penetration, which was 10% in 2005 and is 26% today, will continue to grow. As you have more people watching VOD and there is more and more HD content available, it isn’t hard to see the growing demands on bandwidth. Any operator that isn’t looking for ways to address that is going to face some serious trouble.”
For the moment, a number of operators seem on track to deal with those demands. Armed with a variety of tools, ranging from relatively incremental solutions like splitting nodes to much more capital intensive solutions like switched digital and the adoption of MPEG-4 compression, these operators claim that they will have the capacity to keep up with demand for new HD content.
“My job is to take technology out of the equation and allow the company to bring to the market whatever [HD content] will make the customer happy,” said James Kelso, Cox vice president of video engineering.
Citing competitive reasons, he declined to discuss how much content the operator will actually offer, but he stressed that it is adding “capacity for thousands of hours” of VOD content for standard-definition and HD. “The design is for us to have well north of 1,000 hours [of capacity for] HD content,” he said.
Kelso expects to have the capacity for the new HD on-demand fare in the vast majority of their systems by the end of the year.
In addition, the company is planning to have capacity for 75 linear networks in 2008 and 100 in 2009 and it is planning to rollout its MyPrimetime product to “multiple” markets this year.
MyPrimetime, which features standard-def VOD programming from ABC, NBC and several other networks, is currently being tested in Cox’s Orange County, Calif., system. Adding HD content to that product is also on the roadmap, though the company is not yet willing to discuss a time frame.
Verizon, which has announced plans for 1,000 hours of on-demand HD programming by the end of 2008 and 150 linear HD channels, has been planning for an explosion of content right from the start, said Tricia Lynch, director of programming at Verizon’s FiOS TV and V Cast.
To future-proof its offering against potential demands on its bandwidth, Verizon decided to deploy fiber to the home for its FiOS products and it took a dual approach to its network, using a traditional cable architecture for linear channels and an Internet protocol architecture for its on-demand product. “This gives us maybe three times the bandwidth to the home that cable has,” Lynch said.
The IP path on the FiOS network provides Verizon with additional flexibility and was designed to handle an enormous amount of on-demand programming. “When we started in September of 2005, we put in place a plan to have 15,000 titles of VOD in 2008,” said Lynch. Currently, FiOS has 10,000 to 12,000 VOD titles, of which about 400 are in high-definition.
“We have always intended to be the leader in VOD and HD and we’re now realizing that plan,” she said. “Our stated goal is 1,000 VOD titles a month in HD [by the end of 2008], but I think we will be well over that.”
FiOS is also going all-digital, freeing up additional bandwidth. Lynch said this bandwidth will be primarily used to add new linear HD channels. “On the VOD front, we had already predicted the space we’d need,” she added.
Currently, about 70% of their VOD product is free and she expects that proportion to be maintained as they add more HD content.
While smaller operators lack the resources of the major players, some are also making dramatic additions to their HD fare.
Steve Brookstein, executive vice president of operations at Bresnan Communications, notes that many of their systems offer 30 HD channels today and that they will have 50 linear HD channels by the end of the year, with plans to deploy as many as 100 in 2009.
Bresnan, which serves smaller markets in the Mountain states, is also adding storage capacity for on-demand content, a project that will eventually give them capacity for up to 1,000 hours of HD fare, Brookstein said.
“We have a lot of tools in our toolbox for achieving those goals,” said Pragash Pillai, vice president of strategic engineering. The operator has been preparing their network to handle more HD content by splitting nodes, and adding servers and storage over the last year. It is also looking to go all-digital in Gillette, Wyo., before February 2009, and are exploring other options, including switched digital and MPEG-4 compression.
In Kansas, Sunflower Broadband has been reclaiming analog bandwidth so it can expand its HD linear channels to about 70 this summer.
Shane Woodard, inside plant manager at Sunflower, said last year it went to 256 QAM (quadrature amplitude modulation) and doubled its streaming and storage capacity. Besides reclaiming analog bandwidth, the company is also reducing serving group sizes from 1,000 homes per node down to 500.
Patrick Knorr, Sunflower general manager and chairman of the American Cable Association, is bullish on the potential of HD VOD but adds that his company is taking a cautious approach.
“As we prioritize bandwidth, we have definite concerns about the impact of free HD on bandwidth,” he said.
As a result, the operator has initially focused on paid HD movies on demand. Currently, Sunflower offers about 100 hours of HD VOD and will continue to increase the offering this year, said programming manager Andrea Pritchard.
Pritchard added that buy rates for HD on-demand at the 30,000-subscriber system have been increasing by about 200 a month and that HD movies now account for about 5% of the total buys.
“We’ve been very happy with the buy rates,” Knorr said. “It’s proven to be a very profitable product.”
In upcoming months, Sunflower plans to add some HD VOD fare and will be carrying on-demand content from the Olympics, its first free HD VOD content.
The price tag for these upgrades is difficult to pin down. While Verizon is spending billions on a “future-proof” fiber-to-the-home system for data, voice and video, other approaches are far less expensive.
Some solutions, such as node splitting and adding more storage space, allow operators to expand HD on-demand capacity with relatively incremental capital expenditures; while others, such as fiber to the home, switched digital and the move to MPEG-4 plant, require much more extensive and potentially costly changes to the plant, vendors note.
While operators realize the importance of adding more HD VOD, they are also being cautious in their spending and are putting pressure on equipment and software providers to come up with cost-effective solutions.
“Operators face pressures from investors and don’t have endless capex,” said Paul Braun, senior product manager at Motorola’s Access Networks Solutions division. “The idea is to create solutions that they can build on and deploy the capital to implement as they need it.”
For example, Motorola has come up with a solution that allows operators to put five wavelengths on a single fiber, thus “multiplying the through-put capacity of their fiber by five times,” Braun said, “without incurring the expense of having to open up trenches and lay additional fiber to the node.”
Vendors are also offering servers and back office systems that make it easier and less expensive to add capacity for new HD VOD content.
“From the beginning, we’ve focused on products that have a lot of inherent scalability,” said Alan Hoff, senior director of marketing, core software solutions at SeaChange International. “With those products adding more HD VOD content is basically a matter of adding more storage.”
Hoff added that storage costs are coming down and that flash memory devices are offering operators more energy efficient options. “We have a flash memory storage system that not only has very low power demands but has also a denser storage footprint,” he said.
Many operators are also planning more fundamental — and potentially much more costly — upgrades by deploying switched digital video or by going all digital.
“Comcast and Time Warner Cable are heavily deploying switched digital, which will free up bandwidth like HD VOD,” said itaas chief operating officer Jaspal Bhasin.
Reclaiming analog bandwidth or going all digital is also on the roadmap for a number of operators.
In April, RCN finished moving its Chicago system to all digital so it could expand its HD lineup to over 55 channels. The system is looking to have 100 HD channels by the end of the year.
Bresnan’s Pillai said his company is exploring the possibility of going all digital in additional markets beyond their announced plans for Gillette.
“Gillette is a 625 Megaherz market,” he said. “By going all digital we can offer the same amount of HD services or even more than you can do with an 860Mhz system.”
Further down the road, MPEG-4 will allow operators to significantly reduce the size of HD on-demand streams.
“Cable clearly needs to make a transition to MPEG-4,” Tandberg Television vice president of applications software strategy Michael Adams said. “[Operators] are clearly at a disadvantage in terms of the efficient use of bandwidth until they switch to MPEG-4.”
MPEG-4 set-top boxes are currently being tested and larger MSOs are expected to begin deploying some boxes in the fall, though they’ve been tight-lipped on timetables and how many boxes will be deployed.
Cox’s Kelso said the operator will begin making use of MPEG-4 technology later this year, “We think it is pretty important going forward.” The company has been preparing its plant to use MPEG-4, “but realistically it will take time,” he said.
THE SET-TOP PROBLEM
“You have 50 million digital settop boxes and only now are they starting to become MPEG-4 capable,” said Buddy Snow, senior director of on-demand video, home networks and mobility at Motorola. “So the transition is obviously going to be a long process — years and years. You are looking at billions of dollars in set-top boxes.”
Verizon is currently using MPEG-2 compression and declined to comment on its plans for MPEG-4. But Verizon and other telcos have potential advantage in the transition to MPEG-4 because their subscriber counts are still relatively low and they’ve deployed fewer boxes.
Tandberg’s Adams said, for cable operators, “the set-top box problem is not as bad as you might think.”
Adams said there is already a lot of set-top rotation and that operators could roll the first MPEG-4 boxes out to heavy users of high-def content, helping companies save bandwidth in stages.
Vendors have also developed a number of products to help with transition. For example, Tandberg offers products that can detect what kind of box a user has when they request an HD movie. Then, depending on the box, the system can send out either an MPEG-2 stream or the more compressed MPEG-4 stream.
“If you see that certain customers are watching more HD movies, you can give them an MPEG-4 box and realize significant bandwidth efficiency,” Adams said.
Keeping close tabs on that bandwidth usage is also increasingly important, said Bresnan’s Pillai. “With technology changing so fast you have to have visibility into your network and have close to real time capacity management,” he said.
To help operators constantly monitor networks and plan for their bandwidth needs, Bhasin said it offers two products: a real-time VOD monitor that has been deployed in over 50 cable systems serving about 10 million VOD-enabled homes and a VOD Session Simulator that allows operators to test VOD systems in the lab.
“The monitoring system tracks VOD activity so you can quickly see where bottlenecks are developing and quickly fix those problems,” Bhasin said.
The explosion of HD programming, along with the deployment of more fare on other platforms, is also pushing operators to find better tools for managing and quickly transcoding that content.
“Operators are facing an explosion of content and that is exposing the fact that you can’t survive doing this manually as many have done,” Tandberg Television vice president of business development Jonathan Bokor said. “When you have six or seven different versions of the same asset [for standard-def, HD, online, mobile, etc.] you need an automated solution” that delivers the content in the right form and appropriate resolution to different platforms. To that end, Tandberg has created its WatchPoint WorkFlow System.
Consumers will also need better programming guides to navigate their way through an avalanche of new HD options. SeaChange’s Hoff said the company’s Restart TV product, which allows viewers to restart live programs from the beginning, is designed to be integrated with electronic programming guides. That way, a viewer can easily see what shows are available to be restarted.
SeaChange is also working on a better navigation system that would meld recommendation features with social networking tools to better find VOD content.
After all, having bandwidth to offer thousands of HD shows on demand is only a competitive advantage if consumers can find something in that library they want to watch.