Andrew Steele hasn’t seen anything like it. The cable industry is in a mad dash to implement digital simulcast architectures this year and next, clearing up transport capacity and moving the industry one step closer to all-digital networks free of reclaimed analog channels.
It’s an initiative that touches nearly all departments of a cable system: engineering, operations, advertising and even marketing.
“I have never seen the cable industry move as fast as they are moving now, on anything,” said Steele, vice president of marketing and business development at Terayon Communications Systems Inc. New technologies and new system architectures typically get studied, lab tested, then field trialed, before deployments, a process that can take years.
Digital simulcast sped through all that.
“It went very fast, from first trials to full deployment,” added Adam Tom, president and chief executive officer at RGB Networks.
Charter Communications Inc. announced in January 2004 it would launch a digital simulcast system in Long Beach, Calif. The system went live last summer, and by November, Steele said every major MSO had digital simulcast plans on their drawing boards.
Comcast Corp. in November announced it would launch digital simulcast on most of its systems in 2005.
“Comcast will be the leader this year, as they are aggressively rolling out simulcast in their major cities,” EGT Inc. CEO Greg Nicholson said.
Charter, Cox Communications Inc., Time Warner Cable, Insight Communications Co. and Adelphia Communications Corp. also said they would start digital simulcast conversion.
Half of the top six MSO’s are “very aggressive,” said Gil Katz, director of cable solutions at Harmonic Inc., and will finish most of their systems by year’s end.
“The other half hasn’t decided on an end-to-end architecture, but they are looking at it very seriously.”
“We see digital simulcast, on the low end, as a two-year time horizon to three years to get the majority systems up and going,” Steele said.
COMPETITIVE PRESSURE
Why the rush?
“It’s the competition,” Steele said. DirecTV Inc. plans to add local HDTV signals, “and the telcos are coming to the table.”
Seth Kenvin, vice president of strategic marketing at BigBand Networks Inc., lists several other reasons. Digital simulcast requires operators to now insert digital ads on the newly digitized, former analog channels that typically are cable’s most popular, such as ESPN, Turner Network Television, USA Network, Lifetime Television, MTV: Music Television and Cable News Network. Some operators have already launched digital program ad insertion, but this will hasten deployments, Kenvin said.
That means operators won’t have to run dual analog and digital ad insertion systems. The analog gear can go. “You can get rid of analog ad splicing,” he said.
A second benefit is getting rid of analog tuners in high-end set-top boxes. Operators won’t need analog tuners in digital video recorders, for example, lowering those costs.
An all-digital lineup also provides better picture quality, especially for those subscribers with large HDTV sets.
There are also spectrum gains in the transport plant, opening up bandwidth between headend and hub locations for greater amounts of HD and video-on-demand content.
“You can use GigE [Gigabit Ethernet] for all your transport,” Kenvin said.
“Almost everyone is going with digital decoding and NSTC [National Television Standards Committee] at the edge so they can turn their regional networks and back office operations to all digital,” said RGB’s Tom.
“Ad insertion, conditional access, encryption and backbone transmission will go to digital.”
GEAR NEEDED
In order to implement digital simulcast, MSOs will have to invest in encoders, decoders and digital program insertion equipment. Cable systems carry anywhere from 40 to 100 channels in analog. It starts with the legacy major networks, like ESPN, CNN and MTV, and flows through local channels, including local broadcasters and local access channels.
“There are three levels of encoding,” Katz said. National encoding would work for cable’s national networks and for MSOs that have national fiber backbones to ship around the content.
Another set of networks will get encoded at the regional level, Katz said, such as regional sports networks.
Public-access channels and broadcast TV feeds will be encoded at the local level. “Whenever we can centralize encoding with the national channel we do that,” he said.
“The general notion is you want to centralize as much encoding as you can,” Steele added, for quality of service, cost savings and efficiency purposes.
All those newly encoded signals will be pulled together at the headend, and sent through a system’s transport network to hub locations, that typically serve 10,000 homes or more. At the hub, operators are installing digital program insertion equipment and decoders, to decode signals back to analog for the homes that still have analog TV sets.
It’s important to note that in this rush to implement digital simulcast, the emphasis is on altering the transport network. There has been little immediate discussion about buying millions of low-cost digital set-tops to push digital penetrations from the 40% to 100% range.
AD BENEFITS
Operators who have launched digital program ad insertion have gotten a first taste of what digital simulcast will afford them. DPI allows operators not only to sell digital networks, but to target audiences in specific ad zones. With a conversion to digital simulcast, every hub can become its own ad zone.
If a market has 40 ad zones, an operator could insert 40 different ads in the same time slot on a channel, to target 40 different geographic zones.
“There is a single unified audience to sell,” Steele said, “as opposed to two separate tiers. There is an increased level of granularity in creating more ad zones in their networks.”
Katz said: “We’re starting to talk about full scale DPI.” It’s estimated that no more than 10% to 15% of the industry has undertaken DPI. “No one did it in high scale,” Katz said. Digital simulcast will automatically boost that number.
FUTURE ADDITIONS
The move to digital simulcast will set up the next set of service introductions. “You’re making all products IP capable. It’s not only all digital, it’s all IP to the edge. The digital simulcast projects are the first step towards having switched broadcast services to the home,” Steele said.
Indeed, all that bandwidth savings from headend to hub gets lost from the hub to the home, since the last mile is carrying analog and digital signals. Switching channels at a hub location for only those channels a subscriber is viewing greater reduces the amount if bandwidth in use from the hub to the home.
Future codecs (coder-encoders) are getting greater consideration. “What is now playing into their thought processes is new advanced coding technology,” said Lisa Hobbs, senior director of marketing at Tandberg, including what role VC1 or MPEG-4 (Moving Picture Experts Group) will play in a U.S. cable system. “You could double the number of channels you could carry with MPEG 4.”
