According to one survey, 99% of homes passed by cable will have high speed internet access available by 2013.
This means that something like 119 million homes will have an option to access the net at speeds as follows, according to the DOCSIS 3.0 spec:
“DOCSIS 3.0 specification enables cable modems to provide data rates approaching 160 Mb/s downstream and 120 Mb/s upstream to compete with fiber’s 100 Mb/s downstream and 100 Mb/s upstream. DOCSIS 2.0 data rates are limited to nominally 40 Mb/s downstream and 30 Mb/s upstream.“
According to the Gartner Group:
“[B]roadband users subscribing to 25 Mbps or faster service will increase from 1 percent of total users in 2008 to 27 percent by 2012.”
While you might think that residential users are driving this, in fact it’s businesses:
“The main driver behind cable’s DOCSIS 3.0 build-outs are operational cost savings and the ability to expand high-speed Internet services to small and midsize businesses….”
Not to mention Voice over cable, which is turning out to be a popular service and money-maker for the industry.
Note also the words “operational cost savings” – the technology underlying this speed upgrade (DOCSIS 3.0) builds on the previous DOCSIS 2.0 standard in such a way that the incremental costs to deliver higher speed service does not require massive capital investments. To my simple mind, DOCSIS 3.0 builds its capability by aggregating four DOCSIS 2.0 channels providing 40 Mb/s into one virtual channel that delivers 160 Mb/s with a technique called “channel bonding”.
By splitting the data stream into four channels (similar to packets), CATV operators can load-balance data streams more effectively than with DOCSIS 2.0. So effectively this upgrade delivers higher speeds and better load balancing, all contributing to more competitive offerings at incrementally low additional costs. (For this who wish more detail on this, read DOCSIS 3.0, Raising the Standard)
Time Warner would have its users believe that offering high speed service is an expensive proposition. Funny that Cablevison is embracing DOCSIS 3.0 with a passion:
“Cablevision announced today a plan that will bring speeds of 101Mb/s downstream and 15Mbps upstream to its 3 million customers. To take advantage of the new service, subscribers will be given the option to upgrade their cable Internet to DOCSIS 3.0 for $99.95 per month.”
This service starts rolling out today.
Note also that Time Warner plans to roll out DOCSIS 3.0 in markets facing competition from Verizon’s FIOS service – high speed using fiber technology:
“Time Warner Cable, looking to hang on to Big Apple subscribers in the face of Verizon’s FiOS Internet, expects to begin rolling out DOCSIS 3.0 services starting this summer in New York City and plans to complete the upgrade by the end of 2009.
Chief operating officer Landel Hobbs, on the MSO’s earnings call Wednesday, said the cable company has already installed DOCSIS 3.0-capable cable modem termination system equipment in Manhattan.
‘To date, we have been testing at speeds as high as 138 [Megabits per second] down and 18 up,’ Hobbs said. ‘The system works great. We don’t expect to offer speeds this fast initially, but this demonstrates we will be fully capable of meeting our customer’s need for speed for the foreseeable future.'”
Don’t you find it interesting that TWC is able to roll-out DOCSIS 3.0 systems in markets that are competing with FIOS and yet make a big thing about usage caps and usage pricing schemes in non-competitive markets? And is it not interesting that some cable companies are offering high speeds with no caps AND making money in the process?
It’s not hard to see paradigm-shifting technology here – the TV networks have to be damn nervous about what’s going on here, especially with Hulu’s explosive growth. How all this is going to shake it is very foggy right now – Hulu’s business model is unclear and can’t last. What’s unknown is whose ox will be gored by whom.
What is noteworthy in all this is that readers can expect to see internet speeds increasing by leaps and bounds leading to bandwidth-intensive services of who knows what over the next few years. Hang on – it’s going to be a bumpy ride for some and a joy ride for others. DRM will be a core issue and I would not be surprised to see governments stepping in to overhaul antiquated copyright laws, although market forces are more likely to dictate changes well ahead of any legislation.