Cable Operators: Pursuing Opportunity with Carrier Ethernet
“A place for everything, everything in its place.” Benjamin Franklin had the unique ability to break things down in a simple and easy way. With his example in mind, we work to focus our CEN editorial on providing useful and timely information about issues impacting the global Carrier Ethernet industry. One way we’re striving to do that is by creating features that highlight a particular industry segment and seeking insight from industry experts.
Recently, cable operators have increasingly embraced the latest Ethernet service provider opportunities on offering. In light of that, CEN reached out to industry analysts, and major cable operators in the U.S., to get a more detailed picture of this growing market and the opportunities it presents. As a result, we launched our first CEN editorial series addressing stateside cable operators’ objectives related to Carrier Ethernet. The response has been encouraging and inspired us to identify and pursue other focused editorial series, both domestic and international, relevant to our evolving industry. However, to avoid putting the cart before the horse, let’s revisit highlights from this informative series on cable operators.
We kicked off our coverage by interviewing Andy Paff, managing director for investment banking firm Headwaters MB and long time cable industry executive, who says “wireless backhaul is a tremendous opportunity for cable companies, but it will pale in comparison with Carrier Ethernet services if they do it right.”
Paff has seen a recent change in cable companies’ attitude towards investment in Ethernet. “They’re getting comfortable with the fact that it’s a big business,” he said.
That’s some encouraging news, and was further supported by another installment where we interviewed Heavy Reading’s senior analyst Alan Breznick. His observations show that “three of the largest cable multiple systems operators in the U.S. — Comcast, Time Warner Cable and Cox — all had business service revenues of more than $1 billion for 2010, marking a new industry milestone.”
Breznick also said that an increasing portion of cable business revenues comes from providing backhaul network connectivity for wireless networks, citing that, “it was only a $200 million to $300 million business last year for the entire cable industry, because they only got into wireless backhaul in the last two years.” That said, he estimates that cable operators are currently experiencing backhaul revenues growth in the range of 40 to 50 percent.
Kevin O’Toole, senior vice president, Business Product Management and Strategy for Comcast offered his viewpoints to CEN’s cable series, saying, “cable companies are uniquely positioned to pursue growth opportunities in the Carrier Ethernet market — and by leveraging those unique qualities, cable companies can realize some significant market advantages.” O'Toole also believes that “as more and more organizations turn to cloud computing, they are essentially doubling down on the importance of the last mile.”
Clearly, there has been some notable evolution, acceptance and implementation of the value proposition Carrier Ethernet brings to cable operators. While CEN’s recent focus on U.S. cable operators made for a great editorial run, we anticipate a lot more input from this industry segment – especially the operators outside North America – in the coming months, and offer our sincere thanks to our contributors for their valued input.