zz:Cable's Four Paths to Gigabit Internet
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To gigabit or not to gigabit, that is the question. After considerable debate over whether to offer gigabit Internet service, most cable providers have reached their answer: to gigabit. But how? Cable providers are rising to meet the latest gigabit salvos by Google Fiber Inc. , AT&T Inc. (NYSE: T) and other competitors, but they must invest wisely in the latest Internet technologies. Jumping in before there is significant market demand could jeopardize their return on investment. Jumping in too late could cost them their competitive advantage. In a new report, Heavy Reading identifies four paths that US cable companies are taking to counter the competition, throttle up Internet speeds and prepare for larger gigabit deployments. According to the report, "What Is Cables Right Path to Gigabit Internet?" those who are taking the gigabit plunge are embracing the following key strategies:
Heavy Reading says cable multiple system operators (MSOs) already are employing each of the four strategies. For example:
In the near term, MSOs will rely on hybrid or blended approaches that mix elements of each strategy, according to the report. Since the MSOs still operate regional or local systems with varying technological capabilities and market conditions, there is no easy "one-size-fits-all" solution. Companies will ramp up speeds based upon several criteria, including technical readiness, competitive pressure, upgrade costs and customer demand. This selective approach will help to manage technology costs and target top-tier customers, the report says. The regulatory climate also is playing a role. Internet service providers, newly minted by the Federal Communications Commission (FCC) as Title II providers, are consolidating at a time when government leaders are advocating Gigabit Cities and higher US broadband speeds. AT&T, as part of its deal to acquire DirecTV Group Inc. (NYSE: DTV), promised an extensive rollout of gigabit Internet service through fiber buildouts over the next four years. Charter, which is acquiring TWC and Bright House Networks , and Altice , which is buying Suddenlink Communications and Cablevision Systems Corp. (NYSE: CVC), have not made similar concessions, though both publicly have voiced support for higher speed Internet. The Heavy Reading report provides an update on gigabit Internet, the competition between cable and other providers and analysis of the four strategies that cable operators are employing. It includes profiles of seven suppliers that are supporting cable gigabit Internet services with DOCSIS, fiber and related products. — Craig Leddy, Contributing Analyst |

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