Cable Companies Facing Big Bandwidth Crunch

With internet usage expanding exponentially and demand for high-speed connections ever growing, cable internet companies may soon be facing serious bandwidth issues, according to a report by ABI Research. The problem comes from more demanding applications, including high-definition video, video on demand, online gaming, and higher-bandwidth Internet applications, which could lead to fewer high-definition television channels and sputtering internet speeds. "The increasing bandwidth demands on cable operators will soon reach crisis stage, yet this is a 'dirty little industry secret' that no one talks about," said Stan Schatt, VP and research director for ABI Research.

Currently, cable providers utilize roughly 750MHz worth of bandwidth: ~676MHz for downstream applications like analog cable, digital cable, HD programming, video on demand, Internet data, and VoIP service and 54MHz for upstream transmissions; according to ABI, however, 750MHz just isn't enough to deal with future growth. "Uploading bandwidth is going to have to increase," Schatt stated. "And the cable providers are going to get killed on bandwidth as HD programming becomes more commonplace."

In order to keep customers happy, cable companies may have to resort to costly methods to increase available spectrum such as purchasing spectrum overlay devices capable of providing up to 3GHz of spectrum. Beyond that, few options are available, including rate shaping (controlling the rate at which data packets are transmitted), digital switching (more on that below), overlaying fiber over existing coaxial cable installations, and better MPEG-4 compression (which will lower the bandwidth overhead for HD video). Evenutually, however, cable companies may have to adopt IPTV, which treats video programming as IP data, and thus allows for selective transmission of channels, whereas currently cable companies transmit every channel they provide to each house. "Digital switching is key," Schatt argues. "Ultimately, the cable companies will have to move to IPTV. They'll be brought kicking and screaming into the 21st century."

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