The global cable/broadband/wireless industry is a very large and very important industry for the connectivity ecosystem. Basically, if you love snapping on Snapchat, posting on Facebook, rooting for your fav sports team on ESPN, watching Game of Thrones on HBO (ONE MORE MONTH!!) and of course, watching cat videos (because the internet is for CATS!) then you likely rely on the connectivity industry in some way for your content and delivery.
Some of you have cable TV and/or phone and some of you have broadband internet, and some of you have all of the above. Even though connectivity is a way of life for most of us, there are also a lot of myths about the industry in general. We are going to discuss common myths, and help you debunk them.
1. Content is easy to deliver – it should cost way less
Do you know how the content you crave is actually delivered to you? Let’s use a programing example like The Walking Dead. This one is going to get a little technical for a second, so bear with us. Once programming content is created, it gets transmitted on a fiber-optic backbone line to a big uplink facility, which then transmits it to a satellite in orbit. Programming gets bounced off that satellite into the first major part of the cable system which is the headend. The headend takes all those television signals, processes them, maps them out and then retransmits. Then, the programming goes out in fiber chunks (like a laser gun shooting programming down glass pipes – what a fun image!) to the node units. Typically, there is a node for every 500 homes. From the node, the signal gets transmitted to coax cable which runs down the streets to the home, where the set top box decrypts the signal and you can see the program.
Phew. That is quite the trip around the sun for that little program you are watching. And you’re welcome, I kept all the acronyms out of that description. And that doesn’t even begin to get into all the efforts that go into the operational side to license content. That is a whole other ball of wax, but licensing fees for the programming is the main driver of cost on your cable bill. Which is pretty amazing, considering all the effort that goes into the delivery of content. So, next time you are mad about how much it costs to watch The Walking Dead, remember that it isn’t the multi-system operator you should be mad at.
2. Cutting the cord is easy and won’t affect my TV watching habits
Cutting the cord is a persistent talking point that everyone hears all the time. Here is a story we heard from a friend who recently tried to take the plunge and made a go of it. First though, she had to upgrade her broadband internet to make sure it could handle downloading multiple streams of content from multiple devices. So that was an extra $20 bucks a month. Then she realized that just one streaming device wasn’t going to cut it, so she bought a couple. That set her back $200 bucks. Then there is the monthly OTT services from Netflix, HBO Now, Amazon, and Hulu to make sure she had access to all of her favorite programming. That was another $40-50 a month. And when it was all said and done, she still couldn’t find a way, even with the $100 over-the-air antenna, to watch her Denver Broncos play. That was a bummer. But no matter, because she was saving money, right? Except that once she added up the cost, she really wasn’t. And it is complicated trying to juggle all the shows from different apps and different streaming devices.
The point is, much of the programming today still has license fees, and as we mentioned above, that is the main driver of the cost of cable. So even if you “cut the cord” to cable TV, you still are paying for programming either through direct services like Netflix and HBO, or through streaming services that aggregate the content like SlingTV, AppleTV and Amazon.
3. Fiber is easy to lay out and all companies should do it since it is faster
Fiber IS fast because it is shooting light down a glass tube. It is why many broadband providers actually use fiber, the exception being the last mile to the home is coax. Most cable companies use an HFC plant – a hybrid fiber coax plant – to deliver content.
So, why not just use fiber the whole way, including the last mile? Isn’t it faster? Eh, technically yes, but do you really want your MSO coming around and ripping up your sidewalks and driveways to lay out all that new fiber-optic cable when it would give you a modest amount of extra speed? Probably not.
4. Net neutrality is the only way forward
There are certainly some good arguments on both sides of this issue, but one subtle difference few understand is that MSOs (Multi-Service Operators like your cable company) are being treated differently than MNOs (Mobile Network Operators like Verizon, Sprint, etc) with respect to net neutrality. The essential difference is that broadband would be regulated under “net neutrality” whereas mobile would not. But by deregulating broadband, it encourages investment and innovation, which is good for all of us consumers who always find ourselves wanting more content, faster.
5. Cable companies are old, slow giants
Nope, cable companies are actually quite innovative. We wrote a blog about this a few weeks ago, so be sure to check that out. The connectivity industry is the key to making sure we all make it to a future where we can play VR games with our family, even over a distance, ride in self-driving cars, and operate a home full of smart appliances.
6. There is a speed war going on
Actually, this one is pretty true. We are in a speed war, because as more technology comes out that people really want in their homes and work and everywhere between, there has to be a way to connect that technology. And no matter how many IoT devices you have in your home, they all must connect to your one broadband internet connection, and that connection must be super fast. The industry is collaborating on things like Full Duplex DOCSIS to ensure speeds of 10x what we have available today. The keys to speed are ensuring it's synchronous - i.e. fast up and down (not just down) which is what Full Duplex is all about. Communications in the future will require just as much upload capacity and performance as download (think video conferencing or multiplayer VR games). And the ultimate speed war will be measured by latency, e.g. how much delay or wait time there is in the communication. Ensuring a high-quality experience for gaming, interacting, conferencing, collaborating, etc. will be dependent upon ensuring low latency response times. The real speed war is going to be about fast response times.
So, there you have it. Your five biggest myths debunked, and one that is true. We know that people may have strong feelings about some of these, and encourage discussion! What do you think? Drop us a line, or reach out on social!