Cable MSO Market, U.S.: Mergers, OTT, and 5G Trials

Posted by Mae Kowalke on Friday, March 03, 2017 with No comments

What's new in the U.S. cable MSO market? Here's a roundup of recent news, including 5G trials, increasing competition for over-the-top (OTT) services, and the latest moves by Comcast, Charter, CenturyLInk, and Windstream. 

Broadcast OTT Service Growth

The pay-TV market is undergoing significant changes. One of those, pointed out Light Reading Cable/Video Practice Leader Alan Breznick, is the scaling of streaming video services, which are going mass-market. For example: HBO Now, CBS All Access, and Showtime are continuing to grow as consumers choose streaming video channels instead of broadband connections.

Meanwhile, Breznick noted in the article, pay-TV service providers like AT&T, DirecTV, CenturyLink, and Comcast, are trying to keep up by getting into the OTT space too. Although the market is no doubt becoming more competitive, there is potential for these players to succeed.

"OTT video churn rates, which have been high, are now showing signs of flattening out after climbing for years," Breznick said. Citing Parks Associates research, he added that the three leading OTT providers—Netflix, Hulu, and Amazon—all lowered their churn rates in 2016.

Comcast Charges Ahead

Comcast has been busy with a variety of service innovation and expansion activities. The provider recently announced that:

  • it plans to start offering YouTube on its pay-TV platform later this year. 
  • its Business division is providing Ethernet services to Houston's Texas Southern University.
  • it plans to invest $25 million in a Boston metro fiber expansion, through its Business division. 
  • its Xfinity Stream IP app is now available to all Xfinity subscribers, touted for its ability to let users watch their pay-TV channel lineup on pretty much any mobile device connected to home Wi-Fi.
  • it's collaborating with the Central Office Re-architected as a Datacenter (CORD) open source project to virtualize the cable modem termination system. 
Charter Takes on 5G

After a big 2016 in which it effectively quadrupled its subscriber base by acquiring Bright House Network and Time Warner Cable (forming a new entity dubbed Spectrum), Charter recently announced it's doing some 5G tests as part of a mobile offering (through an MVNO agreement with Verizon) planned for 2018 launch, SDxCentral said.

This move, noted Light Reading, makes Charter the first U.S. cable company to venture into 5Ga definitive statement about the expectation that these providers can and will use their last-mile wired network to advance future wireless services.  

CenturyLink Embraces OTT, Simplifies NFV

In: OTT. Out: IPTV. That's the stance CenturyLink is taking, Light Reading said, as it moves to de-emphasize its Prism TV IPTV service and invest in a new OTT video services slated for launch later this year.

CenturyLink is now "conducting trials of the planned OTT service in four (undisclosed) markets," Light Reading reported, and "intends to launch commercial service in those markets early this spring and then expand its reach throughout the rest of the year."

Meanwhile, under the leadership of a new engineering director, CenturyLink is putting effort into reducing NFV/SDN complexity, Light Reading reported: the providers is "using its internal software development teams to focus on reducing complexity and enable faster development and scaling of new services and infrastructure."

Windstream Completes EarthLink Deal

EarthLink is no more... or at least, it's now part of Windstream. The acquisition, reported Telecom Ramblings, was announced three and a half months ago, and is now complete, with total value coming in at $1.1 billion.

Among the benefits Windsteam expects to gain from the deal are "$150M in annual opex and capex synergies," Telecom Ramblings said, as well as "substantial overlap in the two companies' infrastructure, especially where it comes to the former Deltacom and One Communications fiber network assets. ... EarthLink also brings enterprise and SMB scale out west where Windstream is just beginning to add fiber to its diet, and will help with Windstream's cloud services capabilities."

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