CABLE INFRASTRUCTURE MARKET STATUS, OPTIONS AND STRATEGIES FORECASTS TO 2002

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Report No. A8054982678  200+Pages 60 Tables and Figures 1998      

 

    Cable communications markets are maturing.  Core entertainment business protection requires upgrading to digital capacity.  Cable companies are positioning to offer high definition TV.  Digital cable delivery permits the addition of 20 or 30 regular subscription channels.  The number of pay per view channels increases.  Digital signals provide superior picture and sound quality as compared to analog signals.  Cable companies are implementing clear return paths with set top box Internet access.

    Implementation of hybrid-fiber infrastructure provides broadband access.  Internet services represent incremental revenue potential from existing customers. The cable industry is investing aggressively in network upgrades.  20 different multiple system operator (MSO) technical and marketing trials are proving the broadband digital technology effectiveness.  Two way Internet services have been implemented in 16 states.

    Cable TV subscriber upgrades are analyzed in the study.  35% of hybrid fiber coax (HFC) upgrades, or 23 million homes passed, have been completed by the end of 1997.  50% of the upgrades are complete in mid 1998.  51.4 million more subscribers will need to be upgraded by 2002.  111,500 nodes need to be installed by 2002 at an average cost of $73,000 per node.  The bulk of these will be in nodes serving 500 subscribers.  As more people connect to the Internet, cable companies will upgrade their networks, reaching 200 subscribers per node in places where there is high usage.  However, high usage denotes high revenue, and the investment in 200 subscribers per node will be justified at that time.

    Annual incremental Internet revenue per node is $48,000.  The payback comes from the improvement in core services with an increased value of the digital network so that companies can offer high definition TV signals.  Increased revenues achieved from high definition TV and Internet services make the investment feasible.  A three to four year payback on the capital investment is contemplated. 

 

 

 

CABLE INFRASTRUCTURE MARKET STATUS, OPTIONS AND STRATEGIES  

Forecasts to 2002

 

 

Market Parameters:  

 


Cable capital spending

Subscriber base

Node analysis

Cost per node

Miles of fiber

Miles of coax

Network upgrade path

Internet telephony


Competitive analysis demands understanding of cable infrastructure status.  Cable upgrades provide broadband two way communications paths.  Hybrid fiber loops are needed to offer high definition TV and telephony competition over the Internet. 

        Hybrid-fiber infrastructure provides broadband access 

        Digital cable delivery permits the addition of subscription channels

        Cable companies are implementing clear return paths that permit set top box Internet access

        Internet services represent potential for incremental revenue from existing customers

        Cable infrastructure will be 98% upgraded by 2000


The Study Addresses:

        Market strategies for partnering

        Strategic positioning of cable companies

        Strategic market alliances / Market directions

        Risk/reward scenarios

        Access to customer bases


You NEED This Study

 

Market strategy dynamics:


COMPANIES PROFILED


@HOME NETWORK     

ADELPHI         

HYPERION TELECOMMUNICATIONS    

COMCAST

CORNING      

COX COMMUNICATIONS             

SPECTRUM    

SUN MICROSYSTEMS                   

TCI                   

TELEDISIC     

TELEPORT     

TERAYON      

TIME WARNER

U S WEST MEDIA GROUP

U S WEST !NTERPRISE  

COMMSCOPE

GENERAL SIGNAL           

IMEDIA           

NEXTLEVEL SYSTEMS      


 

REPORT OUTLINE


 

Cable infrastructure    

Executive summary             

 

1. Cable infrastructure market description          

Issues               

 

2. Cable infrastructure market forecasts

Cable market trends               

Households profile              

Cable industry profile              

Clustering       

U.S. Internet   

Number of users

Internet hosts   

Cable modems  

ISDN

xDSL                 

Global Internet

Internet telephony         

Telecommunications                 

Fiber/coax network

US West           

TCI                   

Direct broadcast satellite (DBS)  

Cable infrastructure upgrades          

Local market competition     

MMDS/LMDS

Competitive market aspects

Digital compression     

Private cable     

Broadcast television          

FCC                  

 

3. Cable services positioning for broadband infrastructure    

Time Warner     

Cox technological advances           

Services network architecture requirements  

Cox ring within a ring / WDM

Broadband network cost analysis           

Architecture    

Cox deployment of broadband     

Headend equipment       

Cable services 

Adelphi             

Internet services            

@home             

New cable programming services            

Adelphi Internet

Telephone infrastructure 

Telephone services            

Time Warner Communications

TCI                   

Cox                   

Continental       

Adelphi             

Consumer set top boxes          

Scientific-Atlanta

Cox                   

COMCAST cable                  

TCI                   

Sun Microsystems / TCI                   

General Instrument / Adelphi             

Business services            

PCS mobile telephone        

Satellite          

Primmest          

Network management   

Cabletron          

 

4. Cable infrastructure technology          

Digital cable   

Digital compression    

Cox                   

TCI                   

Fiber optics     

Network architecture    

Cox Fibernet     

@home             

Regional data centers             

Cable modems

Network operations center               

xDSL/cable modem competitive issues               

Current technology trials                

Impulse pay-per-view in

Emerald coast cable and impulse technology        

Transparent LAN service     

ATM                 

Cell relay          

Permanent virtual connections

Sonet               

Hybrid fiber-coax                  

Ingress/thermal noise                

Return transmission issues               

Satellite          

Celestri             

Digital set top boxes                

Scientific-Atlanta

Interactive-ready set-top terminal

 

5. Cable company profiles                

@home network                          

Adelphi            

Hyperion Telecommunications                    

Cablevision

Century

Comcast Corporation    

Corning           

Cox Communications                        

Jones Intercable

Lenfest Group

Media One

Spectrum         

Sun Microsystems  

TCI                   

Teledisic          

Teleport           

Terayon           

Time Warner  

U S West media group                

U S West !nterprise        

 

6. Cable infrastructure equipment provider company profiles                

Commscope     

General Signal

Imedia              

NextLevel systems            

 

7. Cable broadband applications        

Wide area network connectivity of schools             

Cox Fibernet     

Telemedicine  

Cox Fibernet     

Security           

Time Warner     

Broadband cable online service 

Time Warner road runner       

US West           

Work place flexibility        

Time Warner linerunner          

Videoconferencing                     

US West video solutions           

 


LIST OF TABLES AND FIGURES


 

FORECASTS 1997-2002

Market Shares 1997

U.S. Markets Units & Dollars

Internet Global Markets Units & Dollars


                          

Aspects of infrastructure 

Competitive advantages upgraded broadband

Cable market trends               

Cable homes passed

Cable two way capability

Cable market shares

Cable subscribers

Cable channel capacity

Cable TV revenue

Cable systems/subscribers

U.S. Internet users, total

Cable TV Internet access revenue forecast

U.S. Internet access market

U.S. Internet purchases,

U.S. Internet hosts

Cable modem shares / forecasts /units / dollars

Cable modem market forecasts, unit, penetration of U.S. Households

Types of cable modem user    

ISDN lines installed          

xDSL market forecasts

Global Internet users

Worldwide Internet purchases

Internet telephone market driving forces               

Worldwide Internet telephone users, total

U.S. Internet telephone software market forecast

Home office workers            

Installed base of PCs in households, market forecasts          

Telecommunications local services revenue                          

Telecommunications long distance revenue            

U.S. Internet telephone users, total                  

U.S. Miles of telephone wire

Outside plant km of fiber RBOCs

Outside plant km of fiber, RBOC regional summary

Telco TV subscribers

RBOC outside plant copper,

Deployment of two-way broadband infrastructure 

Direct broadcast satellite market shares/subscribers                      

/subscriber penetration greater than 10%, 1997

Cable system miles of plant,

TCI cable system bandwidth Plant status               

Cable TV capital spending

Total cable TV capital spending analytical parameters, for fiber, coax, and headend upgrades

Cable TV upgrades, node, capital spending analysis

Time Warner Cable Road Runner markets

Configuration and advantages of Cox fiber ring-in-ring architecture    

xDSL and cable modem common performance concerns          

Cable increases in capacity       

Cable modem technology trials                

Selected transparent LAN

Adelphia's lines of business      

U S West !nterprise supplier / equipment partners           

 


REPORT METHODOLOGY

This is the twenty-seventh in a series of market forecasts of wireline, wireless, Internet data communications, telecommunications,  and information services.  The project leaders have significant experience preparing industry studies.  Forecasts are based on primary research and proprietary data bases.  In-depth interviews are conducted with a broad range of key participants in the market.


 

 

 

about the company

            WinterGreen Research, founded in 1985, provides strategic market assessments in telecommunications, communications equipment, health care and advanced computer technology.  Industry reports focus on opportunities that will expand existing markets or develop major new markets.  The reports assess new product and service positioning strategies; new and evolving technologies; and technological impacts on products, services, and markets.  Market shares are estimated.  Leading market participants are profiled, and their marketing strategies, acquisitions, and strategic alliances are discussed.  The principals of WinterGreen Research have been involved in analysis and forecasting of international business opportunities in telecommunications and advanced computer technology markets for over 30 years.

 

about the principal authors

 

Ellen T. Curtiss, Technical Director, co-founder of WinterGreen Research, conducts strategic and market assessments in technology-based industries.  Previously she was a member of the staff of Arthur D. Little, Inc., for 23 years, most recently as Vice President of Arthur D. Little Decision Resources, specializing in strategic planning and market development services.  She is a graduate of Boston University and the Program for Management Development at Harvard Graduate School of Business Administration.

 

Susan Eustis, Vice President, co-founder of WinterGreen Research, has done research in communications and computer markets and applications.  She holds several patents in microcomputing and parallel processing.  She is the author of recent studies of the Regional Bell Operating Companies' marketing strategies, worldwide telecommunications markets, and of a study of Internet and Intranet markets.  Ms. Eustis is a graduate of Barnard College.

 

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