Cable eyes big bucks bandwidth issues

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BRUSSELS -- The global cable industry is expected to spend some $80 billion over the next five years in order to fix an impending lack of network capacity, according to a report released Tuesday.

The brunt of the costs will be borne in Europe, where the creaking cable networks will struggle to adapt to demand for such new services as HDTV and online gaming, which gulp huge chunks of bandwidth, the report from ABI Research said.

The study said that various remedies, such as rate shaping and expanding spectrum beyond 750 Mhz, already have been attempted by some cable operators, particularly in the U.S.

But it suggests that a number of other solutions will emerge over the next five years, which could bring the costs down for European operators. These include spectrum upgrades coupled with node-splitting, switched digital video, passive optical network overlay, MPEG-4 compression and home gateway bandwidth management solutions.

"Cable TV operators trying to satisfy the increasing bandwidth demands of HDTV customers feel very much like the thrifty grocer who tried to cram 10 pounds of potatoes into a five-pound bag," ABI vp and research director Stan Schatt said. "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."

However, all the potential answers involve trade-offs and the balancing of cost versus benefit. According to the report, the best real-world solutions for particular operators may be determined using several cost models: a return-on-investment model, a cost-benefit model and a relative cost model.
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