Will Speedier Rivals Impact Cable Operators?

Are cable operators doomed by the limitations of the very same infrastructure that has given them the competitive edge in many urban markets? This question was posed in yesterday’s Wall Street Journal  article, Speedier Internet Rivals Push Past Cable. This article highlighted operators that have fiber networks that can deliver more bandwidth than traditional cable architectures.

Many of these cutting-edge companies referenced in the article have been interviewed by ViodiTV over the past few years. The above playlist presents some of those interviews. And the competition and innovation these providers bring definitely raise the bar, as one of the providers indicates they are offering a gigabit of bandwidth for a$1,000 per month.

Boring of hole for Comcast fiber to the business network.

Construction of a Comcast fiber to the business network.

Despite the premise of the article, it would be premature to count the cable industry out of the bandwidth game. As alluded to in the article, they can continue to improve bandwidth efficiency by implementing DOCSIS 3.0 and bringing fiber deeper in the network by adding fiber nodes. As the article states it would cost multiple billions to instantly upgrade cable networks to offer each of their subscribers dedicated gigabit speeds, but the reality is that, in most places, forklift upgrades are not necessary to remain competitive.  Thus, depending upon a given market, their network investment can continue to be incremental.

Interestingly, in the business markets, they have been fairly aggressive in deploying fiber (since, they often didn’t have a coaxial drop in the first place) and are leaders in the deployment of Metro Ethernet services. At least in the Bay Area, it is the cable operator that is advertising its business class, Metro Ethernet service.