Cable modem/CMTS

Cisco Pops Pay-As-You-Go CMTS Play

NEW ORLEANS -- SCTE Cable-Tec Expo -- Cisco Systems Inc. (Nasdaq: CSCO) is ushering in a radical new cable modem termination system (CMTS) blade procurement model by offering a pay-as-you-go scheme that lets cable operators pay only for the ports they need to provision, with an option to buy more later.

Cisco says it first applied this model last year to its 20 downstream/20 upstream line cards for integrated CMTSs, and it's been received well enough to persuade the vendor to do the same with the "3G60," a blade for "modular" CMTS architectures that can support 60 upstream ports and 72 downstream. (See Cisco Packs On Wideband Muscle , Cisco Alters CMTS Vision With '20/20' Card , and Cisco Aiming to One-Up Cable's Upstream .)

Cisco's doing this to drive sales of its new, denser line cards, but the approach also allows MSOs to license ports (in five-port increments) to help them preserve capital by not having to buy more capacity than they truly need, Mark Palazzo, VP and GM of Cisco's cable access business unit, told Light Reading Cable here at the cable confab.

Operators still have to buy the hardware, of course, but they can provision additional capacity later on as they need it to support video-over-Docsis, upstream channel bonding, or other applications that need a boost.

Palazzo suggests that the model could become the norm as Cisco and other vendors start to migrate and develop products that comply with Comcast Corp. (Nasdaq: CMCSA, CMCSK)'s Converged Multiservice Access Platform (CMAP), a space-saving platform that will combine CMTS and edge QAM functions and pave the way for unicast IP video services. (See Comcast Proposes Its God Box , Vendors Plan for Comcast's 'God' Box , More MSOs Back Comcast's Big Box Project , and Comcast God Box Also a Green Box.)

"This satisfies a lot of what CMAP is trying to achieve in a cost and density approach," he said.

Cisco claims to be the first CMTS supplier to deploy this pay-as-you-go approach, and our initial checks here at the show seem to confirm that view.

Motorola Inc. (NYSE: MOT) has unleashed denser CMTS cards, but doesn't yet see the benefit of going with a capacity licensing model, said Floyd Wagoner, the company's director of global product marketing. (See New Moto CMTS Blade Paddles Upstream.)

"But we would consider it. It's something we can do," he added, noting that Moto may look at such a model as it introduces next-gen CMTS products.

Arris Group Inc. (Nasdaq: ARRS) is also mulling over the idea. "It's a topic that gets discussed," acknowledged the company's chief strategy officer Tom Cloonan. "It's definitely something we're considering."

In the meantime, Arris is offering MSOs a degree of investment protection with this week's introduction of the XD CAM, a new CMTS blade for the C4 chassis with 32 downstream connections, double that of the current generation. (See Arris Boosts CMTS Downstream Density .)

Under a new upgrade program, Arris customers can swap out their older 16-downstream line cards for the new 32-downstream blade at an undisclosed discount, said SVP of business development Stan Brovont.

The move, he said, will help MSOs protect their CMTS investments and help Arris seed deployments of its new, denser card, which will be supported in the first quarter of 2011, when Arris releases the 7.4 version of its CMTS software.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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