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Article

Title: Cable Industry May Need to Spend Heavily on Broadband Upgrades

Author: Grant, Peter Article Type: Product Analysis
Source: Wall Street Journal, v248 n40 pA1(2) Publication Date: Aug 17, 2006
  ISSN: 0193-2241
  Illustrations: Graphs
URL of Publication: http://www.wsj.com

Operators of cable television systems may need to make additional network upgrades in order to keep up with their competition in the high-speed Internet access market, according to a report from Cable Labs, a consortium funded by major operators. Operators face considerable challenges arising from the rapid growth of broadband video services from sites like YouTube and Google. Additionally, Verizon Communications Inc. plans to introduce $20 billion of high-capacity fiber lines in the United States in the near future. Phone and satellite companies are weighing their options in the face of growing competition in the $70 billion per year cable and television marketplace. According to industry analysts, the existing technology of cable operators may not be able to compete with Verizon in the area of Internet services. At some point, optimizing cable networks becomes more costly than deploying fiber lines directly to homes. The decision on whether or not to invest in network upgrades rests with individual cable operators, but the report from Cable Labs indicates that the operators may have to increase their spending on wiring considerably in the future. For some time, firms have tried to assure investors that large monetary outlays for network upgrades are not necessary. The report has angered some cable executives who say existing networks are capable of meeting future broadband demands.

Special Features: Graphs

Companies:
CableLabs Verizon Communications Inc

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