The cost of DOCSIS equipment is dropping about as quickly as the amount of Internet traffic is increasing -- but the long-term transition to IPTV still represents a looming "pain point" for operators, Arris chairman and CEO Bob Stanzione said.
Broadband traffic is rising 50% per year, and the price per downstream channel on cable modem termination systems is falling commensurately, Stanzione said, speaking on a panel of executives from technology suppliers here Tuesday at SCTE's Cable-Tec Expo.
Each of the major CMTS vendors -- Arris, Cisco Systems and Motorola Mobility -- has doubled the density of their platforms in the past year, "and that will just continue," Stanzione said.
With the introduction of even higher-density platforms tailored to CableLabs' Converged Cable Access Platform spec, "you're going to move a lot of that [video] traffic into the DOCSIS sphere, and we expect the price to come down radically at that point."
"Our No. 1 objective is to get CCAP out the door," Stanzione added. "We've been pouring money into [customer premises equipment], gateways in the home, and on CMTS side. We're just now hitting pay dirt, getting those into labs."
Historically, "what we've seen is you end up with four times the bandwidth with just twice the investment," said John Schanz, executive vice president of Comcast's National Engineering and Technical Operations group, who moderated the panel.
Motorola Mobility president Dan Moloney said CCAP as a platform "gives us an opportunity to give a fresh look at... pushing the envelope of what this can do." He said the consumption of Internet video, which represents upwards of 70% of peak traffic, "is going to put a lot of stress on the network" in the near future.
The adoption of IPTV by cable operators will be a huge transition akin to the migration from analog to digital, and from standard definition to high definition, according to Stanzione. "The route to get there is going to be a pain point," he said. "You can't turn off what you've deployed. You can't junk the network."
Schanz asked Moloney what effect Google's pending $12.5 billion takeover will have on Motorola, even given the pledge by Google to take a hands-off approach.
Moloney quipped, "The first thing is, you're going to see us wearing jeans more." He noted that the two companies are required to operate independently until regulatory approvals are cleared, and said "the dialogues at this point are very high level."
Motorola "has a great history of partnership with the industry, and has done some phenomenal things over time -- and I don't see that changing," Moloney said.
The panelists also discussed the effect of the explosion in IP-based consumer electronics. Justin Rattner, vice president and CTO at Intel, said there will probably be more than 1 billion IP devices in the home by 2015 -- and 15 billion total connected devices.
Eric Anderson, vice president of content and product solutions for Samsung Electronics America, said that the increasing amount of video produced for Internet distribution will be complementary to cable TV services "for a long time."
But he added that "you are also seeing some rumblings of virtual MSOs as well," who could reach consumers directly through broadband-connected TVs. "People are definitely experimenting," he said. "YouTube is spending millions of dollars to create original programming, so you can see where that's starting to go."
Samsung recently launched an Internet-connected refrigerator -- and has seen an average of 1.6 hours of usage per day, via apps including Pandora and Accuweather.
As for other challenges the industry faces, Stanzione said that "we need to make cable cool... so we can continue to attract the smartest people in the world. I don't think we're perceived as being cool."
For Rattner, a monumental challenge in the years ahead will be content discovery. There will be an estimated 15 billion hours of television content available on the Web by 2015 -- "It's a humanly unknowable amount of content," he said. That will drive technologies to personalize recommendations and delivery, which will increase computational requirements in the cloud.