cable modem

Bright House Launches Powerboost

Bernie — Wed, 29 Oct 2008 22:54:35 -0400

ORLANDO (October 28, 2008) – Bright House Networks announced today the launch of PowerBoostTM. PowerBoost is a new technology that allows Turbo customers to temporarily experience download speeds significantly faster than their current speed at no additional charge. With PowerBoost, Turbo customers will see download speeds increase while downloading large files from the Internet pending available network capacity. Road Runner Turbo with PowerBoost is available exclusively from Bright House Networks. Read More ...

WOW Unveils New Broadband Tiers

Bernie — Wed, 17 Sep 2008 12:22:25 -0400

WOW unveiled upgraded broadband tiers, including a 15 Mbps service. The previous fastest tier was 6 Mbps. WOW has upgraded all of their tiers and given them new names. The slowest tier, or “Xcite 2Mbps Internet,” offer 2Mbps/500k and the fastest tier, “Xtreme Turbo 15Mbps Internet,” offers 15 Mbps/2Mbps. BroadbandReports.com has all the details.

Justifying FTTH

Bernie — Tue, 19 Aug 2008 10:25:10 -0400

Recent discussion about cable companies beating telcos with new broadband additions has reignited the debate of FTTH and justifying its expense. One argument suggests that cable companies appear to be winning the current broadband battle because their network is superior to a telco’s copper and DSL based network. FTTH would level the playing field, the argument suggests. There is some evidence to support this theory. When you look at Verizon, they did see a big drop in DSL adds last quarter – but they also added new FiOS broadband customers at a much faster rate than DSL customers. But at what cost? In a recent New York Times article, Craig Moffett, an analyst with Sanford C. Bernstein is quoted as saying “… that Verizon would be $6 billion in the hole [as a result of FiOS] when all was said and done.” The New York Times article examines both Verizon’s and AT&T’s strategy for meeting the cable competitive challenge. It’s illustrative of an ongoing debate faced by telcos – should I “bite the bullet” and go with FTTH now, or should I try to extend the life of my copper plant investment for as long as possible. Both sides of the argument have merit.

The extending copper plant argument suggests that you should not strand too much investment in a new wireline network like FTTH, when the technology environment is changing so rapidly. Among other ongoing developments, there is no denying the momentous shift towards wireless for both voice and data. So there is some concern that plowing all this investment into FTTH may not pay off. The New York Times quotes AT&T CTO John Donovan as saying, “The last thing we want to do is overdeploy fixed capacity into the ground where there is no recovery for being wrong by putting in too much.” You certainly can’t disagree with the premise. Of course there is always a flip side to every argument. The competitive race is going on right now. The last thing any telco can do is stand still. FTTH proponents will argue, indecision will just allow cable competitors to pick you off, using a robust triple play bundle, powered by their “superior” network. So while you may not have “over invested” in a FTTH network, you also may not have a stable enough customer base to continue as a going concern over the long term.

What gets lost in this argument, especially when put into the context of Verizon and AT&T, is the impact of wireless. AT&T and Verizon can both afford to somewhat gamble with their wireline network of the future choice. The reality is, both of these companies are now really wireless companies, with wireline assets. Wireline derived revenue is increasingly becoming a minority of their revenue generation. If either of them mis-steps with their wireline strategy, they can afford to adjust accordingly. Other telcos who do not have that luxury are much more at risk with this decision. If you don’t have wireless, then your future obviously rides with broadband. Becoming the best at offering broadband in your given market should be the aim. Deciding on which route to take to achieve that objective will depend on a variety of factors. Factors like consumer preferences, competitor capabilities (present and future), technology innovation implications, and market demographics and firmographics, to name a few. Telcos need a comprehensive understanding of all of these factors before deciding which direction to take. Once these issues are understood, decisions about pulling the trigger on FTTH now, later, or never are much easier to make.

Time to Prepare for DOCSIS 3.0 is Now

Bernie — Thu, 07 Aug 2008 12:39:55 -0400

Second quarter results for broadband growth were a tad underwhelming. There are any number of factors which probably contributed to this slowdown, with the economic slowdown and housing crisis certainly towards the top of the list. But growth is also slowing because broadband penetration has grown considerably over the past few years, now ranging somewhere between 50% to 60% (depending on who you ask), and is beginning to slow down. There certainly is more room for growth, but at some point in the near future, broadband penetration will slow even more as it approaches saturation. It’s anyone’s guess what saturation is, but I would bet somewhere around 75% penetration of households (as a national average - individual markets will vary widely). From a service provider’s point of view, that suggests that posting continuing net adds of broadband customers will increasingly involve convincing a competitor's broadband customer base to switch service.

Is Cable Pulling Away From Telco?

Bernie — Wed, 30 Jul 2008 20:20:27 -0400

Comcast released their quarterly numbers today, and they potentially offer some bad news for telcos. It begs the question, is cable pulling away from telcos in the competitive race? Perhaps. But we also know this race is a marathon, not a sprint. First let’s look at some numbers for Comcast’s 2Q08:

278K new broadband subs in 2Q08, 14.4 million total, representing 29% penetration of homes passed
555K new digital voice customers, 5.64 million total, representing 12.5% penetration of homes passed
Lost 138K basic video subs, but gained 320K digital subs

Pretty impressive when put into the context of their major telco competitors, who are "licking their DSL net adds and switched access line loss wounds." I guess we know one of the reasons why DSL growth slowed so much last quarter. From a 2Q08 perspective, Comcast kicked telco butt. Sanford C. Bernstein & Co. Inc. analyst Craig Moffett tells Light Reading’s Cable Digital News, “...that U.S. cable will own as much as 90 percent of the broadband net additions when the book on second quarter is closed.” What’s even more alarming for telcos is that Comcast CFO Michael Angelakis revealed that new, “premium Internet tier” additions were added at a four-to-one ratio when compared to their “economy” tier. That suggests that cheaper priced broadband is not as appealing as faster more robust packages. If that is indeed true, than DSL may be in even more trouble. DSL is considered the “value” option because, generally speaking, it costs less than cable modem. But if customers are opting for faster bandwidth over cheaper pricing, cable may have an inherent advantage. An advantage that will only be enhanced when DOCSIS 3.0 or wideband becomes more available. Are all the “value” conscious broadband subscribers gone?

Time Warner Cable to Begin Bandwidth Caps

Bernie — Tue, 03 Jun 2008 00:09:03 -0400

Time Warner Cable will officially begin their previously announced broadband bandwidth cap trial in Beaumont, TX this week. Time Warner tells the Associated Press that on average, 5% of their subscribers account for 50% of the bandwidth consumption. Depending on the tier selected, customers will have a cap on the total amount of bandwidth they can use each month, measured by both download and upload traffic. If they exceed their designated bandwidth cap, they will be charged at the rate of $1/Gigabyte per month. Kevin Leddy, Time Warner Cable's executive vice president of advanced technology tells the Associated Press, "We think it's the fairest way to finance the needed investment in the infrastructure."

Of course, there are different viewpoints about Time Warner's real motivation. Could it be an attempt to discourage customers from using competing services for video content? Video is the most intensive broadband bandwidth hog today. A full length high definition movie downloaded over the Internet can equate to 6 gigabytes of data. Considering alternative sources for video consumption are flourishing on the Internet, a conspiracy minded theorist could easily draw the conclusion that Time Warner wants to make it a little more expensive for customers to enjoy these competitive offerings. Netflix, Amazon, and others are pursuing direct to consumer movie download services. Other services including Hulu and Joost aim to offer a compelling mix of video content for Internet download. Quite candidly, the day when consumers can choose to forgo a traditional subscription video model in favor of an Internet only video content delivery option is quickly approaching (if it's not already here). The video below reveals Time Warner Cable's CEO Glenn Britt's view of the spin off of Time Warner Cable from their parent company Time Warner, as well as his take on the impact of Internet video on the cable business.

Is Time Warner trying to slow the trend of Internet video from taking hold by making it more costly for their broadband subscribers? Perhaps. But issues like this are rarely that simple. The reality is probably a little more complex, involving network efficiency and optimization strategies, as well as implementing an element of fairness to broadband availability. After all, it's not an unlimited resource. Why shouldn't the bandwidth hogs pay more? Making customers pay for the bandwidth they actually use isn't exactly anarchy. It's a model that consumers are used to in other areas including, electricity, water, and transportation. Should bandwidth be different?

Comcast: Two-Thirds of New Broadband Customers Churn From DSL

Bernie — Fri, 02 May 2008 00:00:00 -0400

Comcast reports that two-thirds of the new 492K broadband subscribers signed up during the first quarter of 2008 churned from telecom DSL offers. Other interesting metrics for their cable modem high speed Internet product include:

Added 492,000 high-speed Internet subscribers, reaching 28% penetration or 14.1 million customers
High-speed Internet revenue increased 12% to $1.8 billion
High speed Internet evenue growth of 13% from the previous year
2% decline in average monthly revenue per subscriber to $42.18 for high speed Internet

The decline in Comcast's HSI ARPU is primarily attributable to an uptake in their Economy Internet service, which offers 768Kbps service for approximately $25/month.

Comcast continues to see impressive gains in voice service as well. It’s quite clear that broadband and voice services are Comcast’s growth engine. Voice revenues increased 65% and HSI revenues increased by 13%, while video revenues increased by only 5% "It's the diversification of revenue streams that is the strength of our business," said Comcast Chief Executive Brian Roberts, as reported in the Wall Street Journal. For voice service, interesting metrics include:

Added 639,000 Comcast Digital Voice (CDV) customers during the first quarter
Voice penetration reached 12% or 5.1 million customers
Phone revenue increased 65% to $587 million in the first quarter of 2008 from $356 million in 2007

Comcast Launches Pricing for Life Broadband Program

Bernie — Fri, 21 Mar 2008 00:00:00 -0400

Comcast is launching a $42.95/month broadband price for life campaign. The service offers up to 12 Mbps, a McAfee Internet Security Suite, the Games Channel with access to Game Invasion, Rhapsody Radio, and the Comcast PhotoCenter. There is no long term contract to sign and customers can terminate the contract without any early termination fees. The program will only be offered in some western states for now.

Verizon Expands 7 Mbps DSL Service

Bernie — Wed, 12 Mar 2008 13:23:53 -0400

Verizon announced the expansion of its 7 Mbps DSL product to the east coast portion of its footprint. Verizon will offer the new speeds for $39.99/month to DSL customers in Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Virginia, Washington, D.C., and West Virginia. The higher speeds are a clear response to cable modem’s historical speed advantage over DSL. “Our 7 megabits per second Internet service allows you to quickly download information from the Internet and provides an attractive alternative to cable modems," said Susan Retta, vice president, broadband solutions for Verizon. Cable will argue that Verizon’s arrival to the multi-megabit per second broadband speed party is a little late considering they are already offering 7 Mbps packages or more, and intend to keep upping the ante with even faster speeds.

In fact high speed Internet is seen as an important lure, maybe even the most important, for triple play bundle marketing tactics. Emphasizing speed, whether it’s the download portion, or the upload portion, which seems to be gaining more attention in these video sharing days, has always been a priority. As the gap in speeds between competitive offerings begins to narrow, emphasis is also being placed on service and value-add options like security and home networking. Going forward, service providers on all ends of the competitive spectrum will be challenged to create marketing messages and value propositions that rely on more than just “my service is faster (bigger) than yours.”

Comcast Having Success in Luring DSL Customers

Bernie — Fri, 15 Feb 2008 08:11:06 -0500

Comcast reported their fourth quarter 2007 results on Wednesday, and among the typical “we had a fantastic quarter” rhetoric, there was interesting insight on DSL conversions. Comcast reported that 64% of their net new cable modem customers were defectors from DSL competitors. To counter DSL’s “value pricing,” Comcast instituted an “economy tier” for cable modem. The $24.95/month economy tier more closely resembles common DSL pricing. The strategy appears to be having an impact, now accounting for over half of their new cable modem subscribers, and at the expense of their telco competitors. Comcast ended 2007 with 13.2 million cable modem subscribers, representing a 27% penetration of homes passed.

Other interesting news beyond the financials reported by Comcast includes their continuing commitment to DOCSIS 3.0. They intend to have 20% of their footprint migrated to it by the end of 2008. The main implication of DOCSIS 3.0 is dramatically higher broadband speeds, approaching 100 Mbps. It’s Comcast’s answer to Verizon FiOS.