Upgrade costs mounting for cable operators

Companies reluctant to shell out for bandwidth, report says

BRUSSELS -- Cable operators around the world are struggling with costly upgrades to their network and bandwidth, according to a report published Tuesday.

With growing competition in their core pay TV business, and regulatory deadlines looming for the transition to digital, cable companies are reluctant to invest the hefty sums needed for more bandwidth, ABI Research said in its report. Their efforts also are being hampered by the slow migration to an IP-based network for greater interactivity.

The report says that most operators recognize the benefits of moving to 1 GHz networks, which are recommended by top-tier suppliers.

But while operators balk at the first-year cost, they have found that the alternatives have yearly capital and operational costs that are prohibitive over time. One is to reclaim bandwidth through the analog-to-digital switchover taking place in many countries.

Another is Switched Digital Video, which distributes the video in a more efficient manner so that additional uses may be made of the freed-up bandwidth. Although this brings channel-sharing benefits to downstream transmissions, it is expected to ramp up only once the switchover is complete.