By Don Clark
Cable companies are preparing a technology shift to help boost
broadband speeds and defend their turf from the likes of Google
Inc.
Cisco Systems Inc. and its competitors hope to help them.
The networking-equipment giant on Tuesday plans to unveil some
long-awaited products crucial to regaining market share among cable
companies.
Rivals such as Arris Group Inc. and Casa Systems Inc. scooped
Cisco in offering a new class of equipment that can deliver both
video programming and broadband access to subscribers. Combining
the two functions in one device saves space and electrical power in
cable facilities, analysts say.
Such multifunction systems, sometimes dubbed "God boxes," also
are expected to exploit an emerging technology standard for moving
data at higher speeds over standard coaxial cable. Cisco said its
new cBR-8 system will let cable operators offer consumers and
businesses download speeds of one gigabit a second or more.
That is the speed Google has been offering in some U.S. cities
through fiberoptic networks. By comparison, most U.S. cable users
get peak speeds of less than 50 megabits, though services offering
rates of up to 150 megabits are available in some areas. (One
gigabit equals 1,000 megabits.)
With the new product, carriers can make their existing networks
faster "and reduce the cost of delivery at the same time" said
Brett Wingo, vice president and general manager of Cisco's
cable-access business unit.
Comcast Corp., the largest U.S. cable provider, said it is among
the companies testing the new Cisco device in anticipation of wider
deployment. Other users cited by Cisco include Luxembourg's Altice
SA.
Cisco retains a dominant position in Internet switching and
routing systems, and hopes to restore momentum in the cable
market.
Revenue for what Cisco calls its service-provider video segment
fell 19% in the quarter ended in January. Boosting sales in the
cable-equipment market is a likely priority for Chuck Robbins, a
17-year company veteran who was named Monday to succeed John
Chambers as chief executive.
Jeff Heynen, an analyst at market-research firm IHS, estimates
that Cisco's share of the market in cable gear used to deliver
broadband services declined to 29% in 2014, from 52% in 2013. Arris
accounted for 48% of that $1.5 billion market last year, he said,
while Casa's share was about 19%.
Cisco is "facing increasing competition and pricing pressure,"
said Mike Paxton, an analyst at SNL Kagan.
The company's rivals grabbed a substantial head start in the
multifunction devices, which are more formally called
converged-cable-access platforms, or CCAPs. Todd Kessler, an Arris
senior vice president, said it began shipping its converged-access
entry in late 2013 and it now serves more than 20 million cable
subscribers.
Casa said in April that Time Warner Cable had completed a
deployment of its CCAP hardware in New York City.
Cisco executives say its cBR-8 has substantial advantages in
speed and capacity over other offerings. But the full potential of
such gear won't be unlocked until operators adopt new
specifications for boosting the data-transfer rate over existing
cable networks.
Mr. Kessler and others expect that technology to start appearing
in cable networks late this year and reach subscribers more broadly
in 2016. The most obvious impetus for moving quickly is Google,
which has launched its one-gigabit service in three U.S. cities and
plans others.
"Google has created this gigabit club," said Paul Hanna, Casa's
vice president of marketing. "And the race is on."
Write to Don Clark at don.clark@wsj.com
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