The Society of Cable and Telecommunications Engineers' Cable-Tec Expo earlier this month brought several top technical minds to San Antonio to discuss the future of cable's service universe.
That universe is expanding to encompass voice and data along with video, but it's also adopting a steady-state approach to capital spending, the panel of chief technology officers agreed.
With respect to capital expenditures, the CTOs all stressed the shift from major rebuild to efficiency and maintenance.
Charter Communications Inc. will have upgraded 84 percent of its plant to 750 megahertz by year-end and 90 percent by 2003, said Steve Silva, executive vice president and CTO of the St. Louis-based MSO.
And Comcast Corp. has plans to be 80 percent upgraded by the end of the year, with 12 percent of its 550-MHz plant to be made two-way, according to executive vice president and CTO Brad Dusto. Comcast has started upgrade work in Washington and Baltimore, and those rebuilds will focus on investments that will produce revenue, Dusto noted.
"I think the trend of going to success-based capital and revenue-generating capital is on us," he said.
Liberty Media Corp. CTO Tony Werner — who once held that same post at AT&T Broadband — sounded a bearish note.
"My personal belief is that capex is going down," he said.
With most major MSOs nearing the end of their rebuild cycle, expenditures will turn to maintaining the networks.
There will be some fiber-to-the-home projects, "but that's not going to be to the scale of the network upgrades of the 90s," Werner he said.
'GIG E' BACKERS
Still, there is room for new technology options, such as the introduction of Gigabit Ethernet into metropolitan video and business-data transport.
While the panelists agreed that Gig E's not likely to replace Data Over Cable Service Interface Specification (DOCSIS) systems for last-mile residential access, it did offer a strong alternative for transport deeper in the cable network.
Gig E does make sense at headend video-on-demand and data aggregation sites, said SeaChange International Inc. executive vice president of strategic planning Yvette Gordon-Kanouff.
For VOD, a Gig E connection can replace a standard DVP-ASI interface, tripling bandwidth at one-fifth of the cost.
"I think Gig E is not a 'would be nice,' and it has a very good argument," she said.
On the DOCSIS front, Dusto said Comcast has field-tested DOCSIS 1.1 equipment, and as soon as the MSO decides on vendors, it will buy CMTS units that must use the spec. From there, Comcast will likely aggregate DOCSIS 1.1 units in one market and roll out voice-over-Internet-protocol telephony service there.
"If we can make money, we will be doing it," Dusto said.
On Charter's plant, 100 percent of CMTS units are capable of DOCSIS 1.1, and 90 percent of the modems are upgradeable to the specification, said Silva. Charter should be able to turn up DOCSIS 1.1 functionality within 18 months for the 90 percent of the installed units that can upgrade.
"We are looking forward to getting DOCSIS 1.1 because we believe there is even more marketing potential," he said. That includes offering free weekends of 1 mbps bandwidth to lower-tier customers to encourage the upsell, said Silva.
But when the panel started to discuss peer-to-peer applications such as gaming and video file sharing, Silva said the DOCSIS 2.0 standard — which promises to triple upstream bandwidth — was not necessary for that as yet.
"We haven't seen a demand yet go beyond 1.1," he said. "Right now, we have a cost-effective method to deliver everything you have talked about."
On the video side, Silva warned that while advanced boxes are not in vogue, cable shouldn't view its direct-broadcast-satellite competitors' move to put digital video recorder technology in their set-tops with blinders on.
Customers have also told Charter that they like the real-time pause and recall features of DVR, and they've consistently demanded music jukebox features, Silva said. And 30 percent of the cable industry's customers have two digital boxes in their home, "and if we don't start now and provide those products, DBS will take them away from us," he warned.