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Cable TV Business Transformation Initiatives

Faced with more competition in their Pay-TV business, cable operators worldwide are distracted by the all-digital transition deadlines imposed upon them by governing bodies, the available options for upgrading their network, and the slow migration to an IP-based network for greater interactivity.

Moving to 1 GHz networks is often the recommended alternative for network and bandwidth upgrading, but comes at a hefty first-year cost. Apparently, the other alternatives have yearly capital and operational costs that are prohibitive over time.

"The cable sector has all these and other business transformation initiatives to contend with as they also juggle customer satisfaction, retention, and addressable advertising models that don't invade privacy," says ABI Research principal analyst Robert Clark.

What is also occurring in Europe is a slow but steady consolidation of cable operators. Many predicted that would also hold true in the U.S., but that has not been the case.

Cable operators are mainly pursuing three avenues in their quest for greater bandwidth, although not all simultaneously. The first is reclaiming bandwidth via the analog-to-digital switchover now taking place in many countries.

The second, Switched Digital Video, that is expected to ramp up once the switchover is complete, brings channel-sharing benefits to downstream transmissions. The third, and considered the ultimate, option recommended by top-tier suppliers is a complete upgrade to 1 GHz networks.

Cable operators are being very selective right now about how and where to invest in their networks and capabilities, while considering network-based and premises equipment-based (centralized and distributed) alternatives.

ABI's latest report covers core market and technology issues such as the transition to Digital TV, the shift in consumer TV viewing patterns, operator's responses to consumer demand for time- and place-shifting TV, network-bandwidth upgrade options, and the launch of new services.

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