10 GB Cable Broadband?

CableLabs recently put the finishing touches on the new DOCSIS 4.0 standard – the latest standard for delivering broadband across hybrid fiber-coaxial networks. The changes are intended to make cable networks more competitive with fiber networks – although it’s unlikely that we’ll see anybody use the full capacity of the new standard.

Following are the benefits promised by CableLabs in the DOCSIS 4.0 press release:

Speeds up to 10 Gbps. This capability isn’t quite what it seems. The current DOCSIS 3.1 standard already allows speeds up to 5 Gbps and no cable company is delivering superfast speeds because it’s not practical. The only way to achieve 5 – 10 Gbps broadband would be to remove most or all of the channels of TV signal from the system.

Cable systems could consider upgrading to speeds faster than 1 Gbps if they make another costly upgrade of migrating to IP video. Today a cable company sends all TV channels to every customer and blocks the channels that are not subscribed. An IP video system, which is used on DSL and fiber networks only sends a customer the channel they are watching. Such a migration would free tremendous bandwidth within the network but would mean replacing the cable headend and all settop boxes.

Faster Upload Speeds. DOCSIS 4.0 will be able to deliver as much as 6 Gbps upload speeds to go along with the 10 Gbps download speeds. This would allow a cable company to offer a symmetrical 1 Gbps bandwidth product – something that is not possible today and that puts cable networks at a marketing disadvantage compared to fiber. The current DOCSIS 3.1 technology provides for one-tenth of the download speed to be provided as upload – meaning a 100 Mbps download product typically has a 10 Mbps upload speed. Interestingly, many cable products today don’t even use the full 10% upload allotment and assign more bandwidth instead to download.

Improved Reliability. CableLabs is pushing higher reliability as part of the DOCSIS 4.0 upgrade. This will be done using new software they’ve labeled as Proactive Network Maintenance (PNM) that will use increased monitoring and machine learning to identify network problems earlier. However, this technology will become available with DOCSIS 3.1 as well and doesn’t require an upgrade.

Better Security. CableLabs is also touting increased security through a software suite labeled as Micronets. This will allow the cable operator to isolate different parts of the network into separate trust domains so that a problem in one part of the network doesn’t infect the rest of the network. That’s an interesting concept that would also benefit fiber networks.

Low Latency. The last touted benefit of DOCSIS 4.0 is lower latency. There is no way to improve the native latency across a coaxial cable network, so the improved latency comes as a result of a bit of smoke and mirrors. A given customer, such as a small cell site in a residential neighborhood could be given the best possible latency by giving it traffic a priority over all other traffic. This was exactly what net neutrality was supposed to protect against and residential customers in that neighborhood would likely be highly dismayed to know that connection problems are due to the cable company selling priority bandwidth to AT&T in the neighborhood.

Expanded Use of Spectrum. The extra bandwidth for DOCSIS 4.0 comes from the expansion of the frequencies used inside the coaxial cable. Coaxial networks function like a captive radio system inside of the coax and DOCSIS 4.0 expands the usable spectrum on the cable to 1.8 GHz – most cable networks today use 1 to 1.2 GHz of spectrum.

What’s not mentioned in the press releases is the cost. Expanding the spectrum likely means replacing amplifiers and possibly even power taps in the cable network. Using the new spectrum and standard means a swap-out of cable modems. It’s possible in some networks that moving to the increased spectrum will also mean replacing older or frail coaxial cable in the network.

So far, no major cable company has said that they are interested in this upgrade. However, cable companies are under increased pressure to improve upload speeds. They don’t necessarily need to move to symmetrical speeds. However, the weakness of upload bandwidth in cable networks have been highlighted as millions of people try to connect to work and school servers from home during the COVID-19 crisis – I’ve seen more demand for faster upload speeds in the last few weeks than I can ever remember in the past.

The Dirty Secret of Coaxial Broadband

The US has clearly pinned our hopes for providing modern broadband on the big cable companies. At the end of 2019, the big cable companies had almost 68 million customers compared to 33 million for the big telcos. Any discussion of broadband in urban markets is mostly a discussion of big cable company broadband. Cable companies will continue to grow market dominance as urban DSL customers continue to migrate to cable modem. In 2019 the big cable companies added 3.1 million customers while the telcos lost over 600,000 customers.

The big cable companies have all advertised to their customers that they had upgraded to the latest technology in DOCSIS 3.1 and can now provide gigabit broadband – for an expensive price in most markets set well over $100 per month.

It’s easy to think of urban cable systems as up-to-date and high tech and ready and able to deliver fast broadband speeds. While this is true in some cities and in some neighborhoods, the dirty secret of the cable industry is that their networks are not all up to snuff. Everybody is aware of the aging problems that have plagued the telephone copper network – but it’s rare to hear somebody talking about the aging of the cable company copper networks.

Most of the cable networks were built in the 1970s, with some even a little older. Just like with telephone copper networks the coaxial networks are getting old and a network built around 1970 is now fifty years old.

Cable coaxial networks suffer more from deterioration than do telephone copper networks. The copper wires in a coaxial system are much larger and the wires hanging on poles act like a giant antenna that can receive a range of different frequencies. Any physical opening into the wire through a splice point or from aging creates a new ingress point for external frequencies – and that equates to noise on the coaxial network. Increased noise translates directly to decreased performance of the network. The capacity of the older coaxial networks is significantly lower than when the networks were first constructed.

Another issue with coaxial networks is that the type of coaxial cable used has changed over time and some of the coax used in the early networks can’t handle the capacity needed today. Some older coax has been replaced in urban networks, but not all. Coaxial networks in smaller towns still can contain a lot of older-generation coaxial cables.

These issues mean that coaxial networks don’t always perform as well as is touted by the cable companies. I can use the network in my city of Asheville NC as an example. Charter announced nationally that when it upgraded to DOCSIS 3.1 that it had a goal of raising broadband speeds everywhere to 200 Mbps. My speed at the modem is 135 Mbps. I’m not complaining about my speed and I’m glad they increased my speed, but there must be issues in the local network that stopped Charter from achieving its 200 Mbps goal.

We undertake surveys and citywide speed tests across the country and we often see that the performance of coaxial networks varies by neighborhood. We’ve seen neighborhoods where there are more outages, more variance in download speeds, and overall slower speeds than the rest of the city. These problems are almost certainly due to differences within a city of the quality of the coaxial network.

Cable companies could bring older neighborhoods up to snuff, but such upgrades are expensive. It might mean replacing a lot of drops and any runs of older coaxial cable. It might mean replacing or re-spacing amplifiers. It often means replacing all of the power taps (the devices that connect homes to the distribution cables). The upgrading effort is labor-intensive, and that means costly.

I think this means that many cities will never see another unilateral increase in broadband speeds unless the cable companies first make big investments. The cable companies have increased speeds every few years since 2000 to keep ahead of the telcos and to make customers happier with their service. I fear that since cable companies are becoming de facto monopolies in most cities that they have lost the incentive to get faster if that means spending money. The coaxial networks and speeds that we have in place today might be what we still have a decade from now, only with coaxial networks that are another ten years older.

The Future of Coaxial Networks

My blog devotes a lot of time looking at fiber deployment, but since the majority of people in the US get broadband from cable companies using hybrid fiber/coaxial (HFC) technology, today’s blog looks at the next generation of changes planned for HFC.

DOCSIS 4.0. The current generation of HFC technology is DOCSIS 3.1 This technology uses 1.2 GHz of spectrum over coaxial cable. DOCSIS 3.1 has several competitive drawbacks compared to fiber. First, while the technology can deliver gigabit download speeds to customers, the dirty secret of the industry is that gigabit speeds can only be given to a limited number of customers. With current node sizes, cable companies can’t support very many large data users without sacrificing the performance of everybody in a node. This is why you don’t see cable companies pricing gigabit broadband at competitive prices or pushing it very hard.

The other big drawback is that upload speeds on DOCSIS 3.1 are set by specification to be no more than one-eighth of the total bandwidth on the system. Most cable companies don’t even allocate that much to upload speeds.

The primary upgrade with DOCSIS 4.0 will be to increase system bandwidth to 3 GHz. That supplies enough additional bandwidth to provide symmetrical gigabit service or else offer products that are faster than 1 Gbps download. It would also allow a cable company to support a lot more gigabit customers.

The big drawback to the upgrade is that many older coaxial cables won’t be able to handle that much bandwidth and will have to be replaced. Further, upgrading to 3 GHz is going to mean replacing or upgrading power taps, repeaters, and other field hardware in the coaxial network. CableLabs is talking about finalizing the DOCSIS 4.0 specification by the end of 2020. None of the big cable companies have said if and when they might embrace this upgrade. It seems likely that many of the bigger cable companies are in no hurry to make this upgrade.

Low Latency DOCSIS (LLD). Another drawback of HFC networks is that they don’t have the super-low latency needed to support applications like intense gaming or high-quality video chat. The solution is a new encoding scheme being called low latency DOCSIS (LLD).

The LLD solution doesn’t change the overall latency of the cable network but instead prioritizes low-latency applications. The result is to increase the latency for other applications like web-browsing and video streaming.

This can be done because most of the latency on an HFC network comes from the encoding schemes used to layer broadband on top of cable TV signals. The encoding schemes on coaxial cable networks are far more complex than fiber encoding. There are characteristics of copper wires that cause natural interference within a transmission path. A coaxial encoding scheme must account for attenuation (loss of signal over distance), noise (the interference that appears from external sources since copper acts as a natural antenna), and jitter (the fact that interference is not linear and comes and goes in bursts). Most of the latency on a coaxial network comes from the encoding schemes that deal with these conflicting characteristics. The LLD solution bypasses traditional encoding for the handful of applications that need low latency.

Virtual CMTS. One of the more recent improvements in coaxial technology was distributed access architecture (DAA). This technology allows for disaggregating the CMTS (the router used to provide customer broadband) from core routing functions, meaning that the CMTS no longer has to sit at the core of the network. The easiest analogy to understand DAA is to consider modern DSLAM routers. Telephone companies can install a DSLAM at the core of the network, but they can instead put the DSLAM at the entrance to a subdivision to get it closer to customers. DAA allowed cable companies to make this same change.

With virtual CMTS a cable network takes DAA a step further. In a virtual CMTS environment, the cable company might perform some of the CMTS functions in remote data centers in the cloud. There will still be a piece of electronics where the CMTS used to sit, but many of the computing functions can be done remotely.

A cloud-based CMTS offers some advantages to the cable operator:

  • Allows for customizing portions of a network. The data functions provided to a business district can be different from what is supplied to a nearby residential neighborhood. Customization can even be carried down to the customer level for large business customers.
  • Allows for the use of cheap off-the-shelf hardware, similar to what’s been done in the data centers used by the big data complies like Google and Facebook. CMTS hardware has always been expensive because it’s been made by only a few vendors.
  • Improves operations by saving on local resources like local power, floor/rack space, and cooling by moving heavy computing functions to data centers.

Summary. There is a lot of discussion within the cable industry asking how far cable companies want to push HFC technology. Every CEO of the major cable companies has said that their eventual future is fiber, and the above changes, which each bring HFC closer to fiber performance, are still not as good as fiber. Some Wall Street analysts have predicted that cable companies won’t embrace bandwidth upgrades for a while since they already have the marketing advantage of being able to claim gigabit speeds. The question is if the cable companies are willing to make the expensive investment to functionally come closer to fiber performance or if they are happy to just claim to be equivalent to fiber performance.

Can Cable Fight 5G?

The big cable companies are clearly worried about 5G. They look at the recently introduced Verizon 5G product and they understand that they are going to see something similar over time in all of their metropolitan markets. Verizon is selling 5G broadband – currently at 300 Mbps second, but promised to get faster in the future – for $70 standalone or for $50 for those with Verizon cellular.

This is the nightmare scenario for them because they have finally grown to the point where they are approaching a near monopoly in most markets. They have successfully competed with DSL and quarter after quarter have been taking DSL customers from the telcos. In possibly the last death knell for DSL, both Comcast and Charter recently increased speeds of their base products to at least 200 Mbps. Those speeds makes it hard for anybody to justify buying DSL at 50 Mbps or slower.

The big cable companies have started to raise broadband rates to take advantage of their near-monopoly situation. Charter just recently raised bundled broadband prices by $5 per month – the biggest broadband price increase I can remember in a decade or more. Last year a major Wall Street analyst advised Comcast that their basic broadband price ought to be $90.

But now comes fixed 5G. It’s possible that Verizon has found a better bundle than the cable companies because of the number of households that already have cellphones. It’s got to be tempting to homes to buy fast broadband for only $50 per month in a bundle.

This fixed 5G competition won’t come over night. Verizon is launching 5G in urban markets where they already have fiber. Nobody knows how fast they will really implement the product, due mostly to distrust of a string of other Verizon hype about 5G. But over time the fixed 5G will hit markets. Assuming Verizon is successful, then others will follow them into the market. I’m already seeing some places where companies American Tower are building 5G ‘hotels’ at poles, which are vaults large enough to accommodate several 5G providers at the same location.

We got a clue recently about how the cable companies might fight back against 5G. A number of big cable companies like Comcast, Charter, Cox and Midco announced that they will be implementing the new 10 Gbps technology upgrade from CableLabs. These cable companies just recently introduced gigabit service using DOCSIS 3.1. It looks like the cable companies will fight against 5G with speed. It sounds like they will advertise speeds far faster than the 5G speeds and try to win the speed war.

But there is a problem with that strategy. Cable systems with the DOCSIS 3.1 upgrade can clearly offer gigabit speeds, but in reality cable company networks aren’t ready or able to deliver that much speed to everybody. Fiber networks can easily deliver a gigabit to every customer, and with an electronics upgrade can offer 10 Gbps to everybody, as is happening in parts of South Korea. But cable networks have an inherent weakness that makes gigabit speed problematical.

Cable networks are still shared networks and all of the customers in a node share the bandwidth. Most cable nodes are still large with 150 – 300 customers in each neighborhood node, and some with many more. If even a few customers start really use gigabit speeds then the speed for everybody else in the node will deteriorate. That’s the issue that caused cable networks to bog done in the evenings a decade ago. Cable companies fixed the problem then by ‘splitting’ the nodes, meaning that they build more fiber to reduce the number of homes in each node. If the cable companies want to really start pushing gigabit broadband, and even faster speeds, then they are faced with that same dilemma again and they will need another round, or even two rounds of node splits.

For now I have serious doubts about whether Comcast and Charter are even serious about their gigabit products. Comcast gigabit today costs $140 plus $10 for the modem. The prices are lower in markets where the company is competing against fiber, and customers can also negotiate contract deals to get the gigabit price closer to $100. Charter has similar pricing – in Oahu where there is competition they offer a gigabit for $105, and their price elsewhere seem to be around $125.

Both of these companies are setting gigabit prices far above Google’s Fiber’s $70 gigabit. The current cable company gigabit is not a serious competitor to Verizon’s $50 – $70 price for 300 Mbps. I have a hard time thinking the cable companies can compete on speed alone – it’s got to be a combination of speed and price. The cable companies can compete well against 5G if they are willing to price a gigabit at the $70 Verizon 5G price and then use their current $100+ price for 10 Gbps. That pricing strategy will cost them a lot of money in node upgrades, but they would be smart to consider it. The biggest cable companies have already admitted that their ultimate network needs to be fiber – but they’ve been hoping to milk the existing coaxial networks for another decade or two. Any work they do today to reduce node size would be one more step towards an eventual all-fiber network – and could help to stave off 5G.

It’s going to be an interesting battle to watch, because if we’ve learned anything in this industry it’s that it’s hard to win customers back after you lose them. The cable companies currently have most of the urban broadband customers and they need to act now to fight 5G – not wait until they have lost 30% of the market.

Getting Militant for Broadband

My job takes me to many rural counties where huge geographic areas don’t have broadband. I’ve seen a big change over the last two years in the expectations of rural residents who are now demanding that somebody find them a broadband solution. There have been a number of rural residents calling for better broadband for a decade, but recently I’ve seen the cries for broadband grow into strident demands. As the title of this blog suggests, people are getting militant for broadband (but not carrying guns in doing so!)

The perceived need for broadband has changed a lot since the turn of this new century. In 2000 only 43% of homes had a broadband connection – and in those days that meant they had a connection that was faster than dial-up. In 2000 DSL was king and a lot of homes had upgraded to speeds of 1 Mbps. There have always been homes that require broadband, and I’m a good example since I work from home, and when I moved fifteen years ago my offer on a new house was contingent on the home having broadband installed before closing. My real estate agent at the time said that was the first time she’d ever heard about broadband related to home ownership.

As I’ve cited many times, the need for broadband has continued to grow steadily and has been doubling every three years. By 2010 the number of homes with broadband grew to 71%, and by then the cable companies were beginning to dominate the market. By then DSL speeds had gotten better, with the average speeds at about 6 Mbps, but with some lucky customers seeing speeds of around 15 Mbps. But as DOCSIS 3.0 was implemented in cable networks we started seeing speeds up to 100 Mbps available on cable systems. It was a good time to be a cable company, because their rapid revenue growth was fueled almost entirely by adding broadband customers.

Broadband in urban areas has continued to improve. We’re now seeing Comcast, Charter, Cox and other cable company upgrade to DOCSIS 3.1 and offer speeds of up to 1 Gbps. DSL that can deliver 50 Mbps over two bonded copper lines is becoming old technology. Even urban cellular speeds are becoming decent with average speeds of 12 – 15 Mbps.

But during all of these upgrades to urban broadband, huge swaths of rural America is still stuck at 2000 or earlier. Some rural homes have had access to slow DSL of 1 – 2 Mbps at most. Rural cellular speeds are typically half of urban speeds and are incredibly expensive as a home broadband solution. Satellite broadband has been available the whole time, but the high prices, gigantic latency and stingy data caps have made most homes swear off satellite broadband.

Rural homes look with envy at their urban counterparts. They know urban homes who have seen half a dozen major speed upgrades over twenty years while they still have the same lousy choices of twenty years ago. Some rural homes are seeing an upgrade to DSL due to the CAF II program of speeds of perhaps 10 Mbps. While that will be a relief to a home that has had no broadband – it doesn’t let a home use broadband in the same way as the rest of the country.

To make matters feel worse, rural customers without broadband see some parts of rural America get fiber broadband being built by independent telephone companies, electric cooperatives or municipalities. It’s hard for them to understand why there is funding that can make fiber work in some places, but not where they live. The most strident rural residents these days are those who live in a county where other rural customers have fiber and they are being told they are likely to never see it.

This disparity between rural haves and have nots is all due to FCC policy. The FCC decided to make funds available to rural telcos to upgrade to better broadband, but at the same time copped out and handed billions to the giant telcos to instead upgrade to 10 Mbps DSL or wireless. To make matters worse, it’s becoming clear that AT&T and Verizon are intent in eventually tearing down rural copper, which will leave homes with poor cellular coverage without any connection to the outside world.

The FCC laments that they cannot possibly afford to fund fiber everywhere. But they missed a huge opportunity to bring fiber to millions when they caved to lobbyists and gave the CAF II funding to the big telcos. Recall that these funds were originally going to be awarded by a reverse auction and that numerous companies had plans to ask for the funding to build rural fiber.

It’s no wonder that rural areas are furious and desperate for better broadband. Their kids are at a big disadvantage to those living in towns with broadband. Farmers without broadband are competing with those using agricultural IoT. Realtors report that they are having a hard time selling homes with no broadband access. People without broadband can’t work from home. And rural America is being left behind from taking part in American culture without access to the huge amount of content now available on the web.

Charter Upgrading Broadband

We are now starting to see the results of cable companies upgrading to DOCSIS 3.1. Charter, the second biggest ISP in the country recently announced that it will be able to offer gigabit speeds to virtually it’s whole footprint of over 40 million passings.

DOCSIS 3.1 is the newest protocol from Cable Labs that allows bonding an unlimited number of spare channel slots for broadband. A gigabit data path requires roughly 24 channels on a cable network using the new DOCSIS protocol. In bigger markets this replaces DOCSIS 3.0 that was limited to maximum download speeds in the range of 250 Mbps. I know there are Charter markets with even slower speeds that either operate under older DOCSIS standards or that are slow for some other reason.

Charter has already begun the upgrades and is now offering gigabit speeds to 9 million passings in major markets like Oahu, Hawaii; Austin, Texas; San Antonio, Texas, Charlotte, North Carolina; Cincinnati, Ohio; Kansas City, Missouri; New York City; and Raleigh-Durham, North Carolina. It’s worth noting that those are all markets where there is fiber competition, so it’s natural they would upgrade these first.

The new increased speed won’t actually be a gigabit and will be 940 Mbps download and 35 Mbps upload. (It’s hard to think there is anybody who is really going to care about that distinction). Cable Labs recently came out with a DOCSIS upgrade that can increase upload speeds, but there’s been no talk from Charter about making that upgrade. Like the other big cable companies, Charter serves businesses that want faster upload speeds with fiber.

Along with the introduction of gigabit broadband the company also says it’s going to increase the speed of it’s minimum broadband product. In the competitive markets listed above Charter has already increased the speed of its base product to 200 Mbps download, up from 100 Mbps.

It’s going to be interesting to find out what Charter means by the promise to cover “virtually’ their whole footprint. Charter grew by purchasing systems in a wide range of conditions. I know of smaller Charter markets where customers don’t get more than 20 Mbps. There is also a well-known lawsuit against Charter in New York State that claims that a lot of households in upstate New York are getting speeds far slower than advertised due to having outdated cable modems.

The upgrade to DOCSIS 3.1 can be expensive in markets that have not yet been upgraded to DOCSIS 3.0. An upgrade might mean replacing power taps and other portions of the network, and in some cases might even require a replacement of the coaxial cable. My guess is that the company won’t rush to upgrade these markets the upgrade to DOCSIS 3.1 this year. I’m sure the company will look at them on a case-by-case basis.

The company has set a target price for a gigabit at $124.95. But already in the competitive markets like Oahu the company was selling introductory packages for $104.99. There is also a bundling discount for cable subscribers.

The pricing list highlights that they still have markets with advertised speeds as low as 30 Mbps – and the company’s price for the minim speeds is the same everywhere, regardless if that product is 30 Mbps or 200 Mbps. And as always with cable networks, these are ‘up to’ speeds and as I mentioned, there are markets that don’t meet these advertised speeds today.

Overall this ought to result in a lot of home and businesses getting faster broadband than today. We saw something similar back when the cable companies implemented DOCSIS 3.0 and the bigger companies unilaterally increased speeds to customers without increasing the prices. Like other Charter customers, I will be interested in what they do in my market. I have the 60 Mbps product and I’ll be interested to see if my minimum speeds is increased to 100 Mbps or 200 Mbps and if I’m offered a gigabit here. With the upgrade time frame they are promising I shouldn’t have to wait long to find out.

Cable Systems Aren’t All Alike

Big cable companies all over the country are upgrading their networks to DOCSIS 3.1 and announcing that they will soon have gigabit broadband available. Some networks have already been upgraded and we are seeing gigabit products and pricing springing up in various markets around the country. But this does not mean that all cable networks are going to be capable of gigabit speeds, or even that all cable networks are going to upgrade to DOCIS 3.1. As the headline of this blog says, all cable systems aren’t alike. Today’s blog looks at what that means as it applies to available broadband bandwidth.

A DOCSIS cable network is effectively a radio network that operates only inside the coaxial cable. This is why you will hear cable network capacity described using megahertz, which is a measure of the frequency of a radio transmission. Historically cable networks came in various frequency sizes such as 350 MHz, 650 MHz or 1,000 MHz.

The size of the available frequency, in megahertz, describes the capacity of the network to carry cable TV channels or broadband. Historically one analog TV channel uses about 6 MHz of frequency – meaning that a 1,000 MHz system can transmit roughly 167 channels of traditional analog TV.

Obviously cable networks carry more channels than this, which is why you’ve seen cable companies upgrade to digital system. The most commonly used digital compression scheme can squeeze six digital channels into the same frequency that carries one analog channel. There are new compression techniques that can squeeze in even more digital channels into one slot.

In a cable network each slice of available frequency can be used to either transmit either TV channels or else be used for broadband. If a cable companies wants more broadband capacity they must create room for the broadband by reducing the number of slots used for TV.

It is the overall capacity of the cable network along with the number of ‘empty’ channel slots that determine how much broadband the network can deliver to customers. A cable system needs roughly 24 empty channel slots to offer gigabit broadband download speeds. It’s a lot harder to carve out enough empty channels on smaller capacity networks. An older cable system operating at 650 MHz has significantly less capacity for broadband than a newer urban system operating at 1,000 MHZ or greater capacity.

One of the primary benefits of DOCSIS 3.1 is the ability to combine any number of empty channels into a signal broadband stream. But the task of upgrading many older networks to DOCSIS 3.1 is not just a simple issue of upgrading the electronics. If a cable company wants the faster broadband speeds they need to also upgrade the overall capacity of the network. And the upgrade from 350 MHz or 650 MHz to 1,000 MHz is often expensive.

The higher capacity network has different operating characteristics that affect the outside cable plant. For example, the placement and spacing of cable repeaters and power taps is different in a higher frequency network. In some cases the coaxial cable used in an older cable networks can’t handle the higher frequency and must be replaced. So upgrading an older cable network to get faster speeds often means making a lot of changes in the physical cable plant. To add to the cost, this kind of upgrade also usually means having to change out most or all of the cable settop boxes and cable modems – an expensive undertaking when every customer has multiple devices.

The bottom line of all of this is that it’s not necessarily cheap or easy to upgrade older or lower-capacity cable networks to provide faster broadband. It takes a lot more than upgrading the electronics to get faster speeds and often means upgrades the physical cable plant and replacement of settop boxes and cable modems. Cable operators with older networks have to do a cost/benefit analysis to see if it’s worth the upgrade cost to get faster broadband. Since most older cable systems are in rural small towns, this is one more hurdle that must be overcome to provide faster broadband in rural America.

Cable Company Gigabit

We are starting to get a look at what a gigabit product from the cable companies might look like. Late last year Comcast rolled out a gigabit product in parts of Atlanta, Detroit, Nashville and Chattanooga. They are now rolling implementation across the country and the company says that gigabit speeds will be available in all markets by 2018.

Comcast has elected to make the upgrades by implementing DOCSIS 3.1 technology on their networks. This technology allows the network to bond together numerous empty channels on the cable system to be used for broadband.

In markets where there is competition with Google Fiber or another fiber provider, the Comcast product is being sold at an introductory price of $70 per month with a 3-year contract. Month-to-month pricing without the contract is $140 per month. In reading group discussion websites where Comcast customers chat it sounds like there are already many markets where the $70 contract price is not available. I have read some customers say they have gotten prices at $110 to $120 per month, so perhaps the company is flexible with those willing to wade through the customer service maze and willing to sign a term contract.  

The current Comcast product delivers up to 1 Gbps download and 35 Mbps upload. You can expect Comcast to make future upgrades that will improve the upload speeds – but that upgrade is not included in this first generation of DOCSIS 3.1 technology. For now the upload speeds will be a barrier to any application that needs fast upload speeds.

The new technology also requires new hardware, meaning a new cable modem and a new WiFi router capable of handling the faster data speeds. So expect the price to be bumped higher to rent the hardware.

It’s hard to imagine that many customers are going to pony up more than $150 per month to get a gigabit connection and modem. When Google Fiber first introduced $70 gigabit to Kansas City (and when that was their only product), there were reports that there were neighborhoods where as many as 30% of the households subscribed to the gigabit product. But Google has a true $70 price tag and didn’t layer on fees for a modem or any other fees, like Comcast is surely going to do. It’s hard to imagine many customers agreeing to a 3-year contract for the gigabit product in competitive markets if they can buy it from somebody else without the contract. But perhaps Comcast will offer bundling incentives to pull the real cost under $70.

But we know when there are more choices that most customers will opt for the lowest-price product that they think is adequate for their needs. For example, when Google Fiber came to Atlanta they also had a 100 Mbps product for $50 per month and it’s likely that most customers chose that product rather than paying extra for the gigabit.

The Comcast pricing might reflect that Comcast doesn’t want to implement too many high-bandwidth customers at the same time. While DOCSIS 3.1 increases the size of the data pipes available to customers, it doesn’t make any significant improvements in the last mile network. To the extent that high-bandwidth customers use a lot more data, too many gigabit customers in a cable company node could degrade service for everybody else. But it’s likely that most gigabit customers don’t use a lot more data than 100 Mbps subscribers – they just get things done more quickly. But I am sure that Comcast still has worries about having too many high-bandwidth customers in the network.

Comcast and other cable companies are seeing more competition. For example, CenturyLink is selling $85 gigabit service in many western cities and passed about 1 million homes with fiber last year. Verizon FiOS just increased their data speeds in their fiber markets – not quite to a gigabit yet, but at ranges up to half a gigabit. But in the vast majority of the country the cable companies are not going to have significant competition with any foreseeable future.

FCC Commissioner Michael O’Reilly said a few weeks ago that ultrafast broadband is a marketing gimmick. While he was even referring to 100 Mbps broadband as a gimmick, it’s hard to not agree with him that a residential gigabit bandwidth product priced above $150 per month is more gimmick than anything else. There can’t be that many households in any market willing to pay that much extra just for the prestige of saying they have a gigabit.

But over time the prices will drop and the demand for bandwidth will grow and a decade from now there will be a significant portion of the market clamoring for an affordable gigabit product. Remember that we’ve seen this same thing happen a number of times in the past. I remember the big deal the cable companies made when they first increased speeds to 15 Mbps. The funny thing is that the market has a way of filling faster data pipes, and the day will come sooner than we expect where many households will legitimately want and need gigabit data pipes.     

The Beginning of the End for HFC?

coax cablesWe’ve spent the last few years watching the slow death of telephone copper networks. Rural telcos all over the country are rapidly replacing their copper with fiber. AT&T has made it clear that they would like to get out of the copper business and tear down their old copper networks. Verizon has expressed the same but decided to sell a lot of their copper networks rather than be the ones to tear them down. And CenturyLink has started the long process of replacing copper with fiber and passed a million homes with fiber in urban areas in 2016.

Very oddly, the dying copper technology got a boost when the FCC decided to award money to the big rural copper owners like Frontier, CenturyLink and Windstream. These companies are now using CAF II money to try to squeeze one more generation of life out of clearly old and obsolete copper. Without that CAF II money we’d be seeing a lot more copper replacement.

I’ve been in the telco industry long enough to remember significant new telco copper construction. While a lot of the copper network is old and dates back to the 50s and 60s, there was still some new copper construction as recently as a decade ago, with major new construction before that. But nobody is building new telco copper networks these days, which is probably the best way to define that the technology is dead – although it’s going to take decades for the copper on poles to die.

This set me to thinking about the hybrid coaxial networks (HFC) operated by the cable companies. Most of these networks were built in the 60s and 70s when cable companies sprang up in urban areas across the country. There are rural HFC networks stretching back into the 50s. It struck me that nobody I know of is building new HFC networks. Sure, some cable companies are still using HFC technology to reach a new subdivision, but nobody would invest in HFC for a major new build. All of the big cable companies have quietly switched to fiber technology when they build any sizable new subdivision.

If telco copper networks started their decline when companies stopped building new copper networks, then we have probably now reached that same turning point with HFC. Nobody is building new HFC networks. What’s hanging on poles today is going to last for a while, but HFC networks will eventually take the same path into decline as copper networks.

There will be a lot of work and money poured into keeping HFC networks alive. Cable companies everywhere are looking at upgrades to DOCSIS 3.1 as a way to get more speeds out of the technology – much in the same way that DSL prolonged copper networks. The big cable companies, in particular, don’t want to spend the capital dollars needed to replace HFC with fiber – Wall Street will punish any cable company that tries to do so.

Cable networks have a few characteristics that give them a better life than telephone copper. Having the one giant wire in an HFC network is superior to having large numbers of tiny wires in a copper network which go bad one-by-one over time.

But cable networks also have one big downside compared to copper networks – they leak interference into the world and are harder to maintain. The HFC technology uses radio waves inside the coaxial cable as the method to transmit signal. Unfortunately, these radio waves can leak out into the outside world at any place where there is a break in the cable. And there are huge numbers of breaks in an HFC network – one at every place where a tap is placed to bring a drop to a customer. Each of the taps and other splices in a cable network are sources of potential frequency leakage. Cable companies spend a lot every year cleaning up the most egregious leaks – and as networks get older they leak more.

Certainly HFC networks are going to be around for a long time to come. But we will slowly start seeing them replaced with fiber. Altice is the first cable company to say they will be replacing their HFC network with fiber over the next few years. I really don’t expect the larger cable companies to follow suit and in future years we will be deriding the networks used by Comcast and Charter in the same way we do old copper networks today. But I think that somewhere in the last year or two we saw the peak of HFC, and from that point forward the technology is beginning the slow slide into obsolescence.

Technology Hype

coax cablesI find it annoying when I read short articles that proclaim that a new technology that can deliver faster data speeds is right around the corner. This has most recently happened with 5G cellular, but in the past there have been spates of such articles talking about cable modem speeds with DOCSIS 3.1, and faster copper speeds with G.Fast.

It’s always easy to understand where such articles come from. Some vendor or large ISP will announce a technical breakthrough in a lab, and then soon thereafter there are numerous articles written by non-technical people proclaiming that we will soon be seeing blazing speeds at our homes or on our cell phones.

But these articles are usually premature, and sadly there are real-life consequences to this kind of lazy press. Politicians and policy makers see these articles and accept them as gospel and make decisions based upon these misleading articles. It then is up to people like me to come behind and explain to them why the public claims are not true.

This is happening right now with talk about blazingly fast millimeter wave radios to replace fiber loops. Even if this technology were ready for market tomorrow (which it won’t be), like any technology it will have limits. There are places where wireless loops might be a great solution but other places where it may never be financially or technically feasible. Yet a whole lot of the country now believes that our future broadband is dependent upon gigabit wireless, and this is quashing plans for building fiber networks.

One recent set of these kinds of articles proclaimed that DOCSIS 3.1 is going to bring everybody gigabit speeds over cable company networks. And there is some truth to that, but the nuances are never explained. There are a lot of changes needed in a cable network to bring gigabit speeds to all of their customers. What is really happening in the first upgrade is that cable networks will have limited gigabit capabilities. The companies will be able to deliver gigabit speeds to perhaps hundreds of people in a market. Their networks would have problems if they tried to deliver it to thousands, and their networks would crash if they tried to give fast speeds to everybody.

Consider the list of issues that must be overcome to use a cable network to bring gigabit speeds to the masses:

  • First a cable company has to free up enough empty channels to make room for the gigabit data channels. For many cable system this will require upgrading the overall bandwidth of the cable network, and this can be very expensive. In the most extreme cases it can mean replacing all of the network amplifiers and power taps and even sometimes replacing some of the coaxial cable.
  • Cable bandwidth is shared by all of the customers in a neighborhood (called a node). If a cable company only sells a few gigabit products in a given node there will be some small degradation of bandwidth performance for everybody else. But if enough customers want to buy a gigabit the cable company will be forced to ‘split’ the nodes so that there are fewer homes sharing the bandwidth. Cable companies today have nodes of 200 – 300 customers, compared to fiber network nodes that generally range between 16 and 32 customers per node. A cable company has to build more fiber and install more electronics to get nodes as small as fiber systems.
  • Every network has chokepoints, or places where only a set amount of bandwidth can be handled at the same time. There are several of these chokepoints in a cable network – at the node, on the data pipe serving the node, at several data concentration points within the headend, and with the pipe to the outside Internet. You can’t upgrade speeds without upgrading these chokepoints, and that can be expensive.
  • At some point if enough customers want fast speeds the network would need to be fundamentally reconfigured to a new technology. This might mean converting the whole headend and electronics to IPTV. It might mean moving the CMTS (the device that talks to the data at each node) into the field, similar to a fiber network. And it would mean building a lot more fiber, to the point where there would almost be as much fiber as in a fiber-to-the-premise network.

There is always some truth in these technological pronouncements. But these articles are way off base when they then imply that a given breakthrough is the end-all solution to broadband. Yes, cable systems can be faster now, which is great. But DOCSIS 3.1 does not make a cable network equivalent to a Google Fiber network that can already deliver a gigabit to everybody. And yes, there is great promise in wireless local loops. But even after all of the issues with deploying wireless in a real-life environment are solved, the technology is only going to work where there is fiber fairly close to customers and when a number of other factors are just right. These kind of nuances matter and I really wish that non-techie writers would stop telling us that the solution to all of our broadband speed problems is right around the corner. Because it’s not.