Cable industry builds up on internet, telecom
Cable television has come a long way since Ted Turner launched the first basic cable network, WTBS, back in 1976 and HBO began delivering programming across the US around the same time. Today if you have fewer than 100 televisions channels coming into your home, you may as well be living in the Dark Ages.
But for the better part of the history of cable, it was viewed as a pretty niche offering – delivering video content over coaxial cable to the home. Cable companies really had no competition, and in fact their whole business model was built from the ground up as a franchise that was designed to be in only about 60 percent of homes in any market. So for several decades, cable hummed along fairly quietly with many homes paying for basic and premium channels, and as long as the picture quality was good no one really thought twice about their cable provider.
However, the world is a much different place today. Deregulation, the rise of competitive providers and interest in being all things to all people find the cable industry in an interesting situation. Besides facing competition from their usual nemesis, satellite, over the past five to 10 years they've also had telcos breathing down their necks. In fact, as everyone has gotten into everyone else's business, we're in the curious situation of phone companies delivering video services, cable companies providing wireline phone service and every combination in between.
But as cable is coming off of a decade of high growth in North America, Europe and parts of Asia (Japan and Korea), and moving firmly beyond just video distribution to encompass high-speed data, voice over IP and beyond, operators are looking at what they can do to get and stay ahead of the curve.
Growing beyond a niche
Last November, TM Forum made a joint announcement with CableLabs, the non-profit cable R&D consortium that develops new technologies and conducts conformance and compliance testing of products. This collaboration between our two organizations will help leverage TM Forum best practices and standards for the cable industry. The bigger news here is that essentially the US cable operators, which all have stakes in CableLabs, have decided that their two core standards bodies going forward are going to be CableLabs and TM Forum. Where TM Forum comes in is on management software and on the OSS/BSS side, so this is a huge step forward for our organization.
When we started getting involved with the cable industry some years ago, this was the vision we had, but it seemed an awfully long way off. IPDR joined TM Forum in 2007, and at the time there were a number of cable companies using TM Forum standards, but we had no formal cable initiative. We were approached by IPDR to house its activities within TM Forum, and then a number of cable companies and suppliers joined our organization. So it took a few years to get things going, but today we have a good number of cable-related projects happening within TM Forum and the membership to go along with it.
We've brought on board North American players such as Cox, Charter, Time Warner Cable, Rogers and Brighthouse Networks; European providers such as UPC, British Sky Broadcasting, ComHem and Ziggo; and other companies such as CableVision SA Argentina.
In terms of initiatives, we're making a big push and commitment into ensuring that our Frameworx components do what the MSOs need them to do. One is to keep developing and advancing IPDR. Another is to look at how to make the Business Process Framework (eTOM) suitable for a cable environment. Even though eTOM is an independent standard and not linked to any particular technology or solution type, its terminology is very telecom-centric. And even though cable has almost identical needs to telcos, we need to tweak the taxonomy in eTOM to make it suitable for widespread use.
Besides making eTOM more cable-friendly, we're looking at specific activities around business intelligence and analytics for cable, and following on from a very successful cable-based Catalyst at Management World Americas 2010 to the next phase we'll be demonstrating at Management World 2011 in Dublin this May.
Things have really changed for cable since the early days of just a handful of channels coming to your home over the earliest generation of set-top boxes. We've gone from that to potential deals such as the biggest U.S. cable company – Comcast – getting close to finalizing a deal to purchase NBC Universal - something that is sure to fuel a lot of debate The deal would also give Comcast a 30% stake in internet streaming company Hulu.
Whether this particular business deal is an anomaly or the shape of things to come in the cable and content space, it's clear that cable is not out there doing its own thing anymore. It's become very intertwined with the wider communications industry as well as newer internet players and the content producers. Anyone who hopes to do business in this space – or really anywhere in communications – needs to keep in mind that this is a far different market than 30 years ago when just seeing anything beyond the 'big three' television networks was a big deal.
Martin Creaner is president of TM Forum
This article originally published in TM Forum’s Inside Leadership newsletter