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How Cablecos Can Turn From Victims to Victors

Jack S. Burton
10/8/2018
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Cable operators and other broadband service providers have important strategic assets that they can further monetize -- generating new sources of revenue.

Let's start with facilities. With headends and central offices distributed throughout their service areas, cable operators have actual brick-and-mortar real estate that could provide OTT edge service providers with locations to house their servers (as Netflix and others have already done).

Pole attachments, fiber strands and right-of-way assets give providers almost ubiquitous access across their footprint. While the availability to sublet this access varies, the coverage is a most attractive resource to any new provider of access services, be it wired or wireless.

Retail stores are another type of facility that many cable operators have to offer. These stores could be used to promote and sell the products of OTT edge services providers.

People
Cable operators have a highly skilled, experienced workforce. These "human resources" have specialized capabilities that could be of use to others, if positioned and priced correctly. That can produce a new revenue stream for operators.

The field technicians employed by MSOs have the tools necessary to travel across the landscape and attend to both the customers and the remote facilities that an OTT edge service or new access provider may need to visit.

Last, and perhaps most importantly, cable customers are a valuable asset. The subscriber lists contain the names and addresses of people already spending their money on access and edge services; these people are likely to be receptive to new offers.

In recent years, MSOs have been collecting and analyzing data about their customers and their purchasing and viewing habits. This anonymized and demographic information can be valuable, not only to edge service providers but to a range of other businesses.

By leveraging such assets, cable operators can pursue a variety of new business opportunities. We run through these new opportunities below.

Access provider platform
To prepare for the introduction of 5G, new wireless access providers (such as Starry) and existing mobile network providers like Verizon will be placing new basestation radios or small cells all over the landscape to reach their customers with short-range, line-of-sight radio equipment. Incumbent service providers have several opportunities in this market:

    Backhaul
    Connection of the radios to the access provider network can be provided using the cable operator's fiber or HFC network.

    Radio platform
    The cable operator's right-of-way, including existing outside plant facilities, could be used to locate basestations or small cell equipment for the wireless access provider. Depending upon rules from the provider of pole attachments to the cable operator, space could be sublet to the wireless or mobile access provider or wireless equipment could be adopted by the operator. The location of the equipment is one possible revenue stream, maintenance of that equipment is another. With the MSOs' fleet of vehicles and trained RF-experienced field staff, there is a great opportunity for agreements that could benefit both companies.


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In-home/in-office service force
The army of technicians that MSOs have at their disposal is already trained and equipped to provide on-premises customer care. Extending that capability to a third party could be fairly simple.

Installing and maintaining CPE
An OTT TV provider could have technicians install or service its set-top boxes. A business telephone service provider could have someone do station installation at the customer's office. A firewall provider could have help installing on-premises appliances. Even a provider of SD-WAN-based specialized WAN services could have a trained workforce to help place access devices at customer sites, perhaps tied in to Internet access services from the cable operator.

A huge opportunity exists in the healthcare arena. Patients can already teleconference with their doctors using a standard laptop computer, tablet or phone. But new accessories in electronic monitoring of vital signs can take this to another level. While this equipment will be designed for self-installation and run over the top of any broadband network, many customers will require assistance, which is what a cable operator's field force can deliver.

Customer database/sales integration
A cable operator's existing customers represent a group already consuming access and edge services, at a minimum from the provider itself. These customers can be targeted with offers from edge services partners.

Data center/CDN provider
With headends or central offices throughout a community, an MSO or telco has the raw facilities to enter the business of supplying server resources to edge service providers.

The upcoming CORD/HERD (Central Office and Headend Reconfigured as a Data Center) standards will pave the way for cable operators to operate multi-tenant edge services servers efficiently. With the operator and OTT edge provider working together, they can create a better customer experience for both.

Why now?
Declining revenues due to OTT and access competition must be replaced for the cable operator's business to continue to grow. By working with the competition, operators can transform from victims to victors. (See Future State for MSOs: Ready or Not? and How Cable Has Fueled OTT .)

— Jack Burton, Principal, Broadband Success Partners

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Clifton K Morris
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Clifton K Morris,
User Rank: Lightning
10/9/2018 | 1:44:20 AM
I shared this on Wireless Week First...
If memory serves me correct, WallStreet and analysists were talking about Comcast making a tender offer to buy Verizon about three years ago.

Instead of buying Verizon, SpectrumCo (the company originally formed for a widescale WiMAX deployment with companies like ClearWire and Intel) instead pursued a MVNO agreement which also included an exchange of AWS spectrum. Comcast had 60% voting rights of SpectrumCo.

In return, SpectrumCO companies received favorable, long-term MVNO rates for voice and 3G speeds without caps and also fairly inexpensive 4G LTE allowances for their customers.

Today, the Cable Companies offer “unlimited” 3G data with a relatively reasonable 4G allowance. It’s not unlimited LTE because of the sheer number of Customers Verizon still services in-house. Verizon has its hands tied and can not match T-Mobile’s 55GB allowance offered today, which no one has challenged.

Some day, US-based Verizon may have access to similar spectrum licenses and assets T-Mobile has today, and able to offer unlimited to its customers. Verizon would need more low-band PCS and AWS spectrum as a divestiture condition to match T-Mobile’s 55GB offering today... New technology rollouts (millimeter-wave, and 37.2 million miles of Fiber— April 18, 2017 Corning press release) are also needed to compete with assets Sprint/T-Mobile plan to merge together.

SpectrumCo and Comcast did a great job. However, the constant connecting to Xfinity WiFi hotspots adds inter-technology handoff and connection issues. WiFi calling doesn’t seem to be offloading from Verizon’s macro cell network as originally expected. Cable Customer’s definition of “unlimited LTE is limited to 22 gigabytes”.

We’re at an inflection point where someone should ask “why not more data”, “how can we all make money”, and “should customers pay for the same data twice?”

Viewed from a technical perspective these changes to Verizon’s lackluster definition of “Unlimited” likely arise from issues surrounding WiFi standards. WiFi calling frees up Verizon’s macrocell network but doesn’t handle NLOS conditions very well, and customers install cable modems wherever they want inside the home. The fatal flaw in the entire Wi-Fi network spec is an issue where link-rates slow down to the (often physically furthest away) device on the network. To compare, LTE negotiates speed on a per-client device capability regardless of distance.

Technology, policy, and divestitures could solve part of these issue— Hotspots could be better served if they had a LTE radio built-in; Cable had access to a small slice of (10-20Mhz) of AWS/PCS spectrum specifically allocated to LTE, and perhaps 4 watts ERP maximum at the router, instead of 40-watts frequently seen at Macrocell sites. Also, PCS/AWS is outside of spectrum used on Cable Networks, (likely to not interfere with RF used on coax) and a 4 watt ERP at the router would be similar to old analog bag phones; not designed to be next to a person’s ear.

Further more, Inter-technology handover of voice can be more reliable if RAN access was allowed instead of just “vanilla” MVNO. New technologies like SON and SAS could manage the noise floor; increase frequency re-use.

Ideally, something similar to AT&T’s FirstNet implementation would be very consumer-friendly. All internet customers could benefit— they wouldn’t need to be double-billed for data like they are today with Microcells, or slowed down based on the cable subscriber’s rate plan for the home. Also, schools, warehouse, corporate environments would not have to deploy multiple 802.11 routers because of NLOS speed issues inherent to WiFi specs. A more through offloading strategy focused on LTE that uses new technology from CableLabs, LTE standards, (Baicells HALO technology is amazing) all complements and strengthens the entire wireless industry.

SpectrumCo companies could then conceivably negotiate lower prices (similar to Crown Castle’s business model for DAS in airports and stadiums) for all LTE customers using the copper coax already in the ground.

I recently asked a board-level exec at Apple to consider these thoughts/ideas for features to include in their next Airport Router family. Apple is doing a lot with Intel who has a robust LTE patent portfolio. Several years back, I also asked the same folks for a dual-SIM phone. But today, the market has changed and new technology exists like Asymetric DOCSIS 3.1. It’s a great way to monetize the new bandwidth on Cable Networks, and deliver new services people want and enjoy.

When it came to T-Mobile, John Stanton, who founded more than 4 wireless companies to build wireless infrastructure (including VoiceStream, AllTell, CellularOne, Employee #2 at McCaw Cellular) once said ‘T-Mobile had 2 possible routes. One scenario where all the coverage between wireless carriers was the same via collaboration, contracts and market forces; in that scenario, company focus should be on customer service.... The other scenario where TMobile was acquired by AT&T by way of three-way merger of AT&T and (then) Cingular’.

Stanton/McCaw sold their analog cable franchise to get into wireless because of lack of regulation and designation as a utility... which remains very odd that it isn’t... because the satellite content distribution industry is subject to many regulations like cable.

But today, T-Mobile remains 60% owned by Germany’s Deutsche Telekom (only 30% of the company is on the stock market) and DT’s CEO is also Chairman of T-Mobile USA.

It doesn’t bode very well for customer choice to allow one company a monopoly to deliver 100meg internet service to over 90% of the population in the US. The US doesn’t allow this sort of customer reach for standard home telephone service.
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