Cable faces bandwidth crisis, says ABI Research

AUGUST 14, 2007 -- Several solutions are available and, according to a study from ABI Research, collectively they will account for some $80 billion worldwide in investment over the next five years.

AUGUST 14, 2007 -- Escalating demand for bandwidth-hungry services such as HDTV and online gaming is gradually leading to a critical lack of capacity in cable operators' networks. Several solutions are available and, according to a study from ABI Research (search for ABI Research), collectively they will account for some $80 billion worldwide in investment over the next five years.

"Cable-TV operators trying to satisfy the increasing bandwidth demands of HDTV customers feel very much like the thrifty grocer who tried to cram ten pounds of potatoes into a five-pound bag," says vice president and research director Stan Schatt. "The increasing bandwidth demands on cable operators will soon reach crisis stage, yet this is a 'dirty little industry secret' that no one talks about."

Some of the solutions noted in the study -- such as rate shaping and expanding spectrum beyond 750 MHz -- have already been undertaken by some cable operators (particularly in the United States). However, a number of other options will come into play during the 2007-2012 forecast period, including spectrum upgrades coupled with node-splitting, switched digital video, PON overlay, MPEG-4 compression, and home gateway bandwidth management strategies, says ABI.

All these involve tradeoffs and balancing of cost versus benefit, and ABI asserts some are more applicable in certain circumstances than others. ABI says the best real-world approaches for particular operators may be determined using several cost models developed for its research: an ROI model, a Cost-Benefit model, and a Relative Cost model.

The ABI Research study, "Assessing CATV Bandwidth-Expansion Solutions," applies these models to the various ways of expanding the spectrum and bandwidth on video networks.

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