Another Worry for Small Cable Providers

Satellite dish farmBoth the NCTA and ACA have both petitioned the FCC to ask the agency to not require that the new ATSC 3.0 video standard be forced onto small cable operators. Their concern is that requiring cable providers to support the new standard will require a lot of new capital expenditure with little additional revenue or benefit.

The ATSC 3.0 standard is intended to bring video signals into a new digital format that can easily be used in numerous other ways without reformatting. For example, it automatically would allow the same video signal be used for both cable TV, smartphones and other sized screens. The standard would also allow the same video signals to be easily used in new applications like billboards and other kinds of advertising. The standard is meant to make a video usable almost anywhere.

The standard is going to replace the A/53 Digital TV standard that was originally launched in 1996. That standard was intended for sending digital video signals for use on TVs. A lot has changed in the industry since 1996. We now have a proliferation of tablets and smartphones. There is a lot of demand now for better resolution video. And in many cases (like with advertising) we want videos to run at reduced bandwidth. There has also been a lot of improvement since 1996 in the codecs used to encode video.

There are some advantages of the new standard for cable headends. The ATSC 3.0 standard is going to provide a wide range of tunable operating points for transmitting a given video. The work in the labs suggests that the standard will allow transmissions of video signals to be very close to the Shannon limit (the theoretical limit of how much information can be carried over a noisy channel). This means that each video sent out over a digital network can be sized as small as possible according to the content of a given video. Talk shows with few moving parts on the screen, for example, could require less bandwidth than an action movie or sports event.

But that advantage doesn’t seem to be enough of a reason for small cable systems to want to make this upgrade. A cable system is still going to have to reserve enough bandwidth to handle those times when the TV signals are needing the most bandwidth. It’s hard – at least with today’s headends – to see the advantage of using a little less bandwidth for videos unless that can be directly translated into significantly more bandwidth for broadband.

The ATSC 3.0 standard is currently being tested by the big cable companies in Washington DC, Baltimore and Cleveland. The fear of the trade associations and their members is that programmers are going to insist that all cable headends will be required to receive video in this new format.

This standard is clearly a boon to content providers. They can create one version of a video and have it be useful everywhere. That will clearly reduce their production costs. And large cable providers like Comcast might find ways to monetize a more flexible video stream. It’s not hard to imagine Comcast finding ways to shunt video content to more platorms and finding ways to get paid for it.

But small cable headend owners are not going to have these same opportunities. If small cable providers have to adopt this standard it looks like nothing much more than another expensive headend upgrade for no direct benefit to them.

 

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