Packing 'Em In With PacketCable

When MSOs and CableLabs decided to build their initial IP communications network infrastructure based on MGCP (Media Gateway Control Protocol), techies everywhere (myself included) cringed: What are these guys thinking? VOIP is an application that is most powerful when it is decoupled from transport. The future is all about stupid networks and smart end points. You know the SIP rah, rah, rah, and blah, blah, blah… [Ed note: Well, that certainly elevated the debate.]

When crafting the initial PacketCable 1.0 architecture, cable operators opted for the steak, rather than the sizzle. They wanted a cost-effective, rock-solid solution to go after a proven revenue opportunity: local and long-distance voice services – essentially, IP POTS that could be delivered over their DOCSIS broadband data networks. So, SIP was tabled and Network Call Signaling (NCS), a derivative of MGCP, was selected for PacketCable 1.x. The centralized infrastructure helped MSOs come to market with full CALEA and E-911 compliance, not to mention the ability to meet lifeline service reliability thresholds.

What cable operators understood is that while bells and whistles are gee-whiz great, bland can sell quite nicely for commodity-style services. To the point: U.S. and Canadian MSOs now count more than 5 million IP phone customers after adding 1 million customers in the second quarter alone, all with this ho-hum NCS infrastructure. (See Cable Racks Up Over 1 Million VOIP Subs in Q2 .) Those 5 million customers will deliver more than $2.5 billion in new cable revenue over the next year. Ka-ching! And that total will climb quickly – cable operators are now signing up some 11,000 more customers each day for IP phone service.

Consumers are big winners in this story, too. A recent J.D. Power study found that the typical cable IP phone subscriber is spending $11.19 less per month on telephone service than the average ILEC customer. Conducted in July, the survey found that cable VOIP customers pay about $42.40 per month while traditional phone customers spend about $53.59 a month on local and long-distance service. (See NCTA Predicts Big Cable VOIP Savings .)

Thanks to PacketCable NCS, not only is cable phone service cheaper than ILEC offerings, increasingly it sounds better and is more reliable as well. In August, Keynote Systems conducted tests in New York and San Francisco and found the quality of cable IP phone service exceeded that of the PSTN, as well as SIP-based VOIP services. (See Study Says Cable IP Phone Quality Beats PSTN.) Cable’s IP POTS offering may not be sexy, but it is dependable.

All of this is not to say that cable operators don’t understand the power of SIP, IMS, and integrated IP services. While ringing the IP POTS cash register with PacketCable NCS, MSOs are working behind the scenes to extend their infrastructure capabilities. In April, CableLabs issued PacketCable Release 2 (formerly called PacketCable 2.0). Release 2 leverages the general-purpose dynamic QOS functionality of PacketCable Multimedia (PCMM) functionality to support lifeline SIP services and a path for IMS convergence. All the while, it delivers backward compatibility with PacketCable 1.x, which will enable MSOs to continue deploying today's VOIP technology without risking infrastructure obsolescence.

The other major item on the Release 2 agenda is fixed/mobile convergence. Major MSOs like Time Warner, Comcast, Cox, and Bright House are readying initial mobile rollouts in tandem with Sprint Nextel.

And, as reported, cable's SpectrumCo team was a big winner in the FCC's AWS mobile spectrum auction just a few days ago. (See Big Guns Dominate Spectrum Auction.)

By taking a walk-then-run approach, cable operators are making major inroads in the residential phone market. Mobile and business services are next. Voice is sounding increasingly good for cable.

— Michael Harris, Chief Analyst, Cable Digital News

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