An all-digital network was the theme of the Society of Cable & Telecommunications Engineers' gathering here last week — and by Thursday, Charter Communications Inc. said it had a system on the beach in Southern California that could be one of the first to take that step.
The MSO declared it had activated the first "all-digital" network in the country in Long Beach, Calif., the state's fifth-largest city, with the help of Harmonic Inc.'s variable bit rate encoders and third-generation statistical multiplexing system.
Long Beach is actually a hybrid analog-and-digital system, with digital signals delivered over a hybrid fiber-coaxial network simultaneously with basic analog cable programming. That's so consumers who don't have digital set-tops can still see television.
But Long Beach, which uses Scientific-Atlanta Inc. equipment, sports 62% digital penetration— so 62% of the customer base is now being served by an all-digital network.
Charter is looking at so-called dongles and other low-cost set-tops, including devices from cable-modem manufacturers, to supply customers for the final migration to all-digital transmission, said senior vice president of engineering and advanced technology Wayne Davis.
Under that scenario, homes without a digital set-top would need a low-cost device (in the $35 range), in order to receive cable programming.
Those devices aren't ready yet. But when they are, Charter could reclaim loads of bandwidth by turning off the analog feed.
"We've had some boxes built for us that we're playing with," Davis. There is no firm time frame on when such devices would be ready, he added.
Talk of the all-digital network began surfacing earlier this year, championed by Comcast Corp. chief technology officer David Fellows.
Driving the push: A need to free up bandwidth for new HDTV channels and video-on-demand expansion.
An all-digital network also would cut down on signal theft, increase operational efficiency and reduce costs — and score points with Washington regulators as cable moved out ahead of broadcasters on the all-digital transition.
"This is increasingly exciting," Davis said last week, adding that Charter chairman and principal stockholder Paul Allen is a big proponent of the all-digital network.
"It's the first step in the migration path," he said. "This all-digital delivery system will result in significant improvement in picture quality for our customers."
Charter already had partially converted a number of smaller systems to all-digital, satellite-based, delivery over the past years, so it has some experience in the area.
The key technology pieces are a digital compression system that encodes the entire program lineup and a digital program-insertion system.
Charter is using Harmonic's DiviCom MV 50 variable bit-rate encoders and third-generation DiviTrackXE closed loop statistical-multiplexing system.
The MSO carried 93 analog channels before converting the 870-Megahertz system. It's encoding that content to run in seven 6-MHz slots.
Davis said Charter is in the process of getting approval from programmers to digitally encode signals. The side benefit for programmers and customers is a much better picture, he said.
"You don't have audio variations. You don't pick up [hybrid fiber coaxial] impairment, because it's digital. Through digital processing, we clean all that up."
The Long Beach system has also added digital ad-insertion capabilities, so it could continue to place ads in newly encoded digital program streams. "We're splicing digital into digital," Davis said.
Because Long Beach has a lot of bandwidth (870 Megahertz), it was able to run parallel analog and digital networks.
But as HD channels proliferate, there will be more pressure to reclaim that analog bandwidth in Long Beach sooner rather than later. Thus, Charter and other MSOs might want to advance the natural conversion to digital that will come as consumers continue to embrace HDTV, digital video recorders and video-on-demand.
In the meantime, there should be maintenance cost savings from the all-digital portion of Long Beach's network.
"Part of the effort is to document the cost savings," Davis said.
There's also an upside with digital ad insertion. "Our digital program insertion capability enables us to centralize the compression systems, while at the same time locally and dynamically insert ads, both simplifying the process and making our service more relevant to the viewer and valuable to advertisers," Davis said.
Harmonic said the compression capabilities of its digital headend make it possible to provision multiple standard-definition and HDTV digital channels, each with a full-resolution, broadcast-quality picture, using the spectrum required to deliver a single analog channel.
That allows bandwidth to be freed up for new services, such as HDTV, VOD or subscription VOD, Davis said.
Davis also said digital service can be remotely and instantly activated, "eliminating the need for a truck roll when adding a customer or service."
Charter said entry-level digital set-tops that support broadcast, interactive and VOD services are about half the cost of comparable analog/digital set-tops.
Removing both the analog receiver and internal digital video compression subsystem from set-tops with a digital video recorder (DVR) results in lower costs, Charter said. And because the MPEG-2 video is compressed and distributed from the headend, there's more room to store programming on digital-only DVR set-tops than in a mixed analog-digital service environment.
The all-digital network was a hot topic among the nearly 800 attendees at SCTE's ET show, especially for systems in need of an upgrade.
A typical upgrade for a 750 MHz system could cost between $17,000 and $19,000 per mile, said former Charter engineer Don Loheide, now vice president of network engineering at Cequel III.
But an operator could get much of the same bandwidth extension benefits by converting to an all-digital base, and achieve those gains at a lower cost.
"At 60% penetration, a digital upgrade could save between $195 and $325 per customer," Loheide said, based on getting new digital set-tops in the $70 or below range.
The benefits also exist for 450-MHz systems.
"Reclaiming the analog channels all at once is an effective strategy for systems in need of an upgrade," Loheide said. "There is a real cost savings over upgrading the system to 750 MHz."
"The all-digital environment will provide the market scale for targeted advertising and new interactive TV applications," Loheide added.