Cable industry pursues upgrades in face of its 'life or death' momentCable industry pursues upgrades in face of its 'life or death' moment
Comcast's David Watson and Liberty Global's Michael Fries discussed the industry 'talent gap,' network upgrade strategies and cable's 'existential' moment in a fireside chat at the SCTE Cable-Tec Expo this morning.
September 20, 2022
PHILADELPHIA – SCTE CABLE-TEC EXPO 2022 – Gathered in person for the first Expo since 2019, leaders of the cable industry expressed a mix of optimism and anxiety about what's ahead as operators pursue a mad dash to upgrade networks, amid ever-greater competition.
Taking the stage here in Philadelphia this morning for a fireside chat, Comcast CEO David Watson and Liberty Global CEO Michael Fries reflected on the challenges of the last few years, how the industry rose to the occasion and what needs to happen to remain competitive in an ultra-competitive market. Here are a few takeaways.
Mind the talent gap?
Asked by session moderator and CableLabs CEO Phil McKinney whether the industry is facing a "talent gap," as some analysts and studies suggest, Watson and Fries offered slightly different answers.
Pointing to the volume of activity in the space, from network upgrades to new fiber passings, Watson attributed the talent crunch to "just the sheer amount of people that you need to pull this off." Further, he said, networks are changing and that requires new skill sets.
"As we change the network or big components of the network to virtualize, and as we add more capabilities, it does require people to get trained up on how to do this, and how to manage a virtualized network. There are more software elements than ever, in terms of how we manage the digital capabilities."
Figure 1: Liberty Global's Mike Fries warns of cable's "life or death" moment on multiple screens at the 2022 SCTE Cable-Tec Expo.
(Image source: This COVID-conscious Light Reading editor, from the back of the room.)
Fries said there's enough talent for the "everyday" tasks of upgrading networks and building 5G but that the industry needs data experts and people "who can help us get into new revenue streams, new opportunities."
'Bottle the magic'
Watson and Fries both reflected on the work cable companies did to keep subscribers connected during the pandemic. "Our networks stood up to the moment and our people stood up to the moment. You all were unbelievable," said Watson to applause.
Fries further noted that it's important for the industry to "bottle that magic" to remain on customers' good sides.
"I tell my team, let's bottle that magic. Because after decades in this industry, you as well, we weren't always the most popular with customers. We didn't always get the best [Net Promoter] scores," he said.
However, throughout the pandemic, he added, "we built and developed a much better relationship with our customers and the businesses that we serve, and hospitals and regulators in government. And that's a special thing."
'Life or death'
Keeping customers happy isn't just a nice thing for cable companies like Liberty Global and Comcast as they face mounting competition from other cable providers pursuing fiber upgrades and a myriad of new competitors from fiber and fixed wireless startups to electric cooperatives and municipal governments and beyond.
Neither is differentiating their revenue streams. For Liberty Global, that includes its recent forming of a joint venture with Telefónica and InfraVia Capital Partners to roll out FTTH to greenfield premises across the UK. This, Fries said, will enable the company to gain access to wholesale revenue – rather than paying BT.
Of course, to keep up with future demand – from residential and business broadband to the metaverse – cable companies are pursuing a mix of network upgrades to achieve symmetrical, multi-gig speeds on par with full fiber networks. Comcast announced earlier today that it successfully tested the "final component needed" for its planned 10G and DOCSIS 4.0 rollout.
And for Liberty Global, Fries said he expects the "vast majority" of the operator's footprint to be full fiber in the next five to six years. He also noted the company currently has a 10G product on the market in Switzerland.
All of this work speaks to cable's "existential" moment, said Fries.
"It's life or death," he said.
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