Anaheim, Calif.— While cable operators are apparently resolute about deploying high-definition television, how to deal with the myriad bandwidth, content and business issues remains a fuzzy picture at best, as attendees found out at the Cable and Telecommunications Association for Marketing luncheon at the Western Show here last week.
The session delved into the challenges that surround bringing HDTV to market, and there was no shortage of issues to address.
To start with, cable operators need to find ways to fit bandwidth-sapping HD channels into a digital-video plant that's already crowded with standard channels and video-on-demand offerings.
"We are going to have to be better at offering more efficient ways to manage that bandwidth," admitted Bill Geppert, vice president and general manager of Cox Communications Inc.'s San Diego division.
The MSO can gain back some bandwidth by converting analog channels to digital, but making the system more dynamically efficient by sending HD streams only to HD customers would make a big difference, according to BigBand Networks Inc. chief operating officer Jamie Howard.
The video-technology provider is working on a switched broadcast system that could do just that.
But if every local broadcaster and cable network makes the digital transition — and also starts funneling multiple video streams through their single, 6-megahertz channel — that still may not be easy. Not only would that require the content to keep up with the conversion, but it also has overload potential.
"How does that bandwidth get managed when you have four to five stations in your local market, plus the cable networks all demanding their share of digital bandwidth?" asked Tim Hanlon, vice president and director of emerging contacts for Starcom MediaVest Group.
There also needs to be enough HD content to drive consumer interest. ESPN, which is within four months of launching its high-definition service, is banking on the fact that the sharp picture and wide-screen format is a natural for its sports audience.
"We're very optimistic about it and are charging forward," said Sean Bratches, executive vice president of affiliate sales and marketing for the sports programmer.
Consumer confusion has also degraded how HD is perceived, panelists agreed. As many as 27 percent of cable customers believe they already have HD, according to various reports, even though all but a handful have boxes and TV sets able to render the format.
The public also needs a better idea of what exactly HD's sharp picture and wider screen can do for them. That presents a huge opportunity for cable operators, content providers and retail electronics outlets to market HD and showcase its benefits, thus giving consumers a reason to buy HD sets, according to Frank Romeo, director of DTV strategy group for Samsung Electronics America Inc.
"A DTV set alone is not going to make the sale, and I think that is something the cable industry needs to look at," he said.
But the current reality is that HD deployments will reach a relatively small cable audience. Cox recently deployed HD in San Diego, and so far, there have been about 1,000 service orders and 750 HD set-top boxes installed, according to Geppert.
Despite the attention given to these services, high-definition television isn't likely to become a big revenue provider going forward.
"I don't see high-definition being necessarily a huge contributor," Geppert said. "I think it is something we have to have, we need to have, to stay competitive."