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The Broadband 50

Sat, 11/30/2002 - 7:00pm
Roger Brown, Jeff Baumgartner, Duffy Hayes and Matt Stump


2002

Welcome to the second installment of the Broadband 50, a collection of companies, people and technologies that the editors of CED (with help from Multichannel News' Matt Stump and Karen Brown) believe will shape, define and influence the broadband industry in 2003.

Once again, we enlisted the all-knowing and all-powerful Google search engine to provide a "scientific" method of ranking this year's 50. Like last year, we used Google's advanced "exact phrase" feature to generate more consistent results.

Though we tried our darnedest to create an all-ranging (and fair) list that displays the tops in broadband–and argued with each other over our choices–we're sure that readers like you will think we missed something. By all means, drop us a note and let us in on who you'd add to the list and why. We'll share those results in a future issue.

AOL Time Warner

Who's running the ship now?

Google Factor: 976,000

Last year: 83,300

What a year it was for AOL Time Warner. The multimedia conglomerate landed at the top of the CED Broadband 50, based on a Google Factor ranking that was probably generated as much by morbid curiosity about a merger gone wrong than anything else.

Late last year, Gerald Levin was ousted from the chairman's suite, replaced by AOL wunderkind Robert Pittman. The AOL division was slammed by the freefall in the Internet advertising market, subscriber acquisitions slowed and a federal government investigation into questionable advertising deals put AOL alongside Enron and Adelphia in the headlines.

The whole premise of the merger, of which broadband played a part, was ceremoniously dumped into the trash heap by angry investors. The post-mortems continue to this day, but through the fallout, it's clear that broadband has actually been one of the few bright spots for the company.

Time Warner Cable added between 257,000 and 278,000 cable modem subscribers in each of the first three quarters of the year–more than any other cable or telephony company. RoadRunner now counts 2.3 million subscribers, which, by the way, is 2.3 million more than Excite@Home can count.

What's more, company officials say about 20 percent or more of each quarter's additions stemmed from other broadband ISPs, which, they say, proves the multiple ISP model works.

Time Warner Cable also became the cable industry's clear leader in VOD deployments in 2002. By year's end, VOD will have been launched in 32 of TWC's 34 markets, plus a number of markets now part of the Advance/Newhouse spinoff. Those VOD launches put on-demand services in front of most of TWC's 3.5 million digital subscriber base. And the VOD lineup is a full complement of hit movies from every Hollywood studio, save for Paramount Pictures, a claim no other MSO can make. There's also SVOD content from HBO, Showtime, The Movie Channel and Cinemax, and free-on-demand content from 10 basic cable services. TWC has been the leader in pricing SVOD at $6.95 per premium package and generating revenue from the service.

Not lost in all of this is the fact TWC, in just nine months time, deployed hundreds of servers and catchers in hundreds of headends. That involves a matrix of servers, catchers, guides, set-top boxes, and headend equipment, all made interoperable by the company's Interactive Services Architecture. Some newer launches employed centralized server setups and dallied with Gigabit Ethernet technology.

TWC also joined other MSOs in rolling out high-definition television boxes and set-tops with personal video recording capability. By year's end, 50,000 HD boxes will be in TWC systems, while PVR-enabled Explorer 8000 set-tops will be deployed in Green Bay, Wis.; Rochester, N.Y.; and Austin, Texas.

The great promise of synergy in the merger could still be found in parts of the company. CNN announced a deal late in the year to supply its subscription broadband video Internet for free to RoadRunner subscribers. It was the first deal between a traditional cable network and a broadband ISP. It just so happens both companies are owned by the same corporate parent.

In the end, there are plenty of reasons for AOL Time Warner to land on CED's top 50 list. It's just that this year, the notoriety surrounding the company pushed it into the number-one slot for not always the best of reasons.

–Matt Stump, Multichannel News

Cisco Systems Inc.

Down, but not out

Google Factor: 415,000

Last year: 280,000

Love it or hate it, this bellwether technology company practically defines IP networking. Sure, there are lots of other smart companies out there, but Cisco's expertise and early adoption of DOCSIS allowed it to dominate the DOCSIS 1.0 CMTS market. With cable operators loath to throw out legacy systems and software, that leaves Cisco poised to similarly reign over the next-gen gear market as well.

But that's just part of the picture. Cisco practically owns the network further upstream, behind the DOCSIS sphere of influence, where the rest of the Internet lurks. From backbone routers to high-speed Ethernet switches and high-capacity optical transport, Cisco rules. In addition, Cisco has aggressively supported standards development at CableLabs and tCom Labs (which oversees EuroDOCSIS testing), beginning with DOCSIS 1.0 and continuing through to PacketCable and OpenCable.

For most cable operators, the biggest issue they have related to high-speed data is scaling the network to accommodate a growing number of users without busting out the walls of their headends. At this year's Broadband Plus show, Cisco plans to unveil the MC520 DOCSIS Processing Engine, which combines high port density and capacity with advanced RF functionality in a modular line card upgrade for the uBR10012.

Others, like Arris and Juniper, will continue to pressure Cisco–their presence will keep the giant honest and responsive. But as long as the company doesn't stumble badly as the world transitions to broadband access, cable operators will be reluctant to switch out existing Cisco platforms. Now, if we could just get the company's marketing folks to rename those routers . . . .

–Roger Brown

Verizon Communications

Renewed commitment to DSL

Google Factor: 64,000

Last year: 51,900

Verizon
After a slow start, DSL is beginning to close the gap on the cable industry's lead in high-speed Internet service. So far, cable's lead could arguably be attributed to the failures of the nation's biggest telecommunications providers, SBC and Verizon.

But over the past year, Verizon has reassessed, refocused and repackaged its broadband service to really make a run at the next generation of broadband customers.

What Verizon has come to realize is that offering broadband service across its footprint is essential to its long-term survival. Today, huge Verizon counts more than 1.6 million DSL customers, but the service is available to just over half of its coverage territory. That's not enough, and Verizon knows it, so it revamped its strategy, pledging 62 percent coverage by the end of the year, and 70 percent coverage by the end of 2003. After wrestling with the build-out strategy and over-promising in the early stages of DSL development, it now appears to be back on track.

After grappling with customer service and operational efficiency issues over the past year, Verizon seems to be emerging from the darkness. It spent to solve many of the operational problems, and the once-familiar cries of awful customer service seem to be waning. That's an area where it's thrown some money at the problem, and is seeing positive results.

To make the package more attractive, Verizon has been marketing a bundle to lure current customers to broadband. Its most popular DSL plan drops to $35 a month when a customer takes a bundle of wireless, local or long distance service. That should give a needed push to sluggish DSL sales.

–Duffy Hayes

Texas Instruments Inc.

Turbo-charging DOCSIS

Google Factor: 39,900

Last year: 38,100

In the cable data sector, Texas Instruments has always represented a stern riposte to the lung of market-leading cable modem silicon provider Broadcom Corp., providing chipsets for the likes of Toshiba and Arris. But that competition reached a new level in May, when the largest supplier of DOCSIS cable modems, Motorola Broadband, picked TI as its second source for silicon. In addition to keeping Broadcom honest in its dealings with Motorola, the move also further legitimized TI's position in the sector.

TI / DOCSIS 2.0
Then, in October, TI showed off the fact that it is–along with Terayon Communication Systems and Broadcom–more than ready to put its DOCSIS 2.0 silicon to the test, submitting a reference design to CableLabs in certification wave 24.

Like Broadcom and its Propane software, TI also has some proprietary technology designed to widen cable's relatively gaunt upstream pipe. TurboDOX, as it's called, uses sophisticated algorithms to allow cable operators to expand, up to three times, the number of modems supported over a single channel, while also improving upstream capacity. But, unlike Broadcom, TI has yet to announce any TurboDOX support among cable modem vendors.

– Jeff Baumgartner

Net2Phone

Cable's future IXC?

Google Factor: 120,000

Last year: Not on list

Net2Phone software
Net2Phone’s software gives Liberty CableVision a jump on VoIP.
Not too long ago, conversations involving Net2Phone were typically tied to Internet telephone calls distributed to personal computers. Well, not anymore. Followed by financial backing from companies such as AT&T and Liberty Media and trials to boot, Net2Phone today is considered a player in an evolving PacketCable movement that eventually will lead to carrier-class IP telephony services over broadband networks. Not only that, but Net2Phone's technology and services could be tapped eventually to serve as cable's interexchange carrier, connecting operators' IP networks in such a way that voice traffic that flows over them can completely avoid the hassles, and therefore the costs, tied to the ol' reliable public switched telephone network.

Net2Phone's most prominent work with cable so far was launched earlier this year when Liberty CableVision of Puerto Rico initiated phase one of an "end-to-end" toll-quality IP telephony trial with about 100 subscribers that routed calls to Net2Phone's managed softswitch. Phase two, expected to be initiated by year's end, will examine the scalability of the platform, add marketing to the mix, and test the business mettle of cable-based VoIP. In Net2Phone's view, its outsourced service model will enable cable operators to maintain ownership of their telephony subscribers by providing Tier one customer and technical support. –JB

ESPN Inc.

Playing the broadband game

Google Factor: 23,800

Last year: Not on list

EXPN
ESPN, already a ubiquitous brand and service for sports fans everywhere, is preparing to take it up a notch next year with acronyms such as HDTV and SVOD.

In April, ESPN will launch ESPN HD, producing about 100 live hi-def telecasts in its inaugural year. Thanks to relationships with Major League Baseball, the National Basketball Association, the National Football League and the National Hockey League, sports junkies will have more than enough content to get their daily fix.

While ESPN HD fills up cable pipes with content in 720p format, the hybrid and premium EXPN, Action Sports On Demand, service will be offered to cable modem customers (with content cached at the headend) and/or offered as a TV-centric, SVOD service next year. –JB

RealNetworks

Making content 'Real'ly available

Google Factor: 32,800

Last year: 33,600

RealOne Player
One of the apparent casualties of the great Internet bubble-burst are streaming media technologies, especially ones that focus solely on the PC for delivery and display.

But for RealNetworks, makers of the popular RealOne subscription audio and video player, the shift in market forces has meant a fairly robust shift in strategy as well.

In a nutshell, RealNetworks wants to push beyond the PC, and into devices and platforms that show more promise for mainstream acceptance and use. That strategy has materialized into a few high-profile partnerships this year, including being ported to the newest TiVo Series2 PVR. The latest RealOne Player will be the piece that manages and streams Internet audio content through the TiVo box, essentially turning the video recorder into a jukebox for a small additional fee.

Another non-PC platform RealNetworks is angling in on is the media center, a product with special significance to the future of the cable industry. Back before it was sucked into Digeo Inc., Moxi Digital announced a set-top integration deal with RealNetworks. In the same CE vein, RealNetworks has also struck deals with chipmakers like Hitachi, Philips and NEC, which should materialize into embedded Real technology in devices like DVD players and other personal CE gear.

The final leg of the new Real strategy is to make its player more available, which re-opens another debate, that of open versus closed source development. RealNetworks recently released the source code to its client streaming media software, which has provisions for all the major operating environments including Linux. Its open-source toolbox, the "Helix DNA Client," includes code for the RealOne media player and associated audio and video codecs. Whether an open-source approach can thwart Microsoft's growth and bring RealOne to the masses will be a question the marketplace answers over the coming year. –DH

EarthLink Inc.

Broadband, innovation forge keys to success

Google Factor: 26,400

Last year: 18,100

At EarthLink Inc., the "I" in ISP should stand for "innovative." Its forward-thinking approach to home networking, digital music availability and software that obliterates annoying advertising "pop-ups" has won it new customers and a loyal following.

At the same time, EarthLink has remained a trailblazer in the broadband arena, scoring carriage deals and deployments with MSOs Time Warner Cable and AT&T Broadband (now Comcast) and trials with Cox Communications and the former Comcast.

EarthLink's broadband agnostic approach (it has deals covering the cable, DSL and satellite high-speed gamut) has also helped it manage to weather a slowly deteriorating narrowband subscriber base. EarthLink's dial-up base shrunk 5.2 percent to 3.9 million subscribers in the third quarter, but its broadband business jumped by 77,000, giving it a total of 681,000 high-speed subs.

That's not to say, though, that everything has turned up roses for EarthLink. Its push into cable could be slowed a bit in 2003 due to the fact that federal regulators did not apply any "open access" conditions to the Comcast-AT&T Broadband merger as it did when AOL and Time Warner got married. –JB

Cox Communications Inc.

Adapting to a new bottom line

Google Factor: 16,000

Last year: Not on list

These guys seem to be doing everything right. As poster boys for the new, more fiscally responsible cable industry, Cox Communications will be among the first to become free cash flow positive in 2003. And that's important because the mavens on Wall Street will be demanding nothing less.

Getting to that point is the result of: a focused plan to carefully and methodically rebuild its cable networks; adding new high-margin services like high-speed data and voice; extending the reach of the network beyond the residential areas into business locations; and growing the company incrementally instead of taking on massive new debt via merger.

With more than 90 percent of its rebuild program completed, Cox is focused on reaping the benefits of its investment. Capital expenditures will drop from $2.2 billion in 2001 to $1.6 billion in 2003. In the meantime, Cox is rolling out new services with a vengeance. The company added more than 12,000 new Internet subscribers per week during the third quarter of 2002, and now has nearly 1.3 million high-speed Internet customers. On the telephone side, the third quarter of 2002 was the strongest one yet.

And Cox has done well in gaining digital video subs while retaining core basic video subscribers as well–something that's been plaguing their brethren. Digital penetration stands at 42 percent, while basic subscribers grew 1.2 percent over 2001.

Video-on-demand has likewise been put on the back burner, with just four systems moving forward with launch plans. Others will be launched, but only after Cox carefully studies the cost of deployment and compares that to incoming revenue. In our book, it's a recipe for success and potential dominance. –RB

Comcast Corp.

Nimble giant

Google Factor: 15,000

Last year: 20,820

Roberts
There's a new cable king in town, and its name is Comcast. All eyes are now fixed on Philadelphia, home of the largest MSO on the planet.

Though Comcast is an extremely agile and decisive MSO, the challenges ahead of it are many as it chokes down and assimilates AT&T Broadband. For starters, it must complete AT&T Broadband's job of plant upgrades, and tighten a tourniquet around a bleeding subscriber base in former AT&T Broadband systems.

Lest there be confusion about exactly who bought whom and who's really in charge of the newly combined company, the AT&T brand was summarily dropped from what originally was to be called AT&T Comcast. In addition to avoiding both customer and market "confusion," as it was explained last month, the decision to drop the AT&T brand might also help Comcast eradicate the stigma AT&T Broadband has carried for years, a stigma whose roots can be traced back to TCI and its former boss, Dr. John Malone.

Moving forward, the business and consumer community will be keeping close tabs on how the cable industry's new bellwether moves ahead on advanced video, voice and data services, checking to see if the burden and weight of its new crown slows it down even one step.

Though Comcast has history on its side when it comes to running an efficient and profitable business, all bets will be off once the honeymoon period ends with Wall Street and the press. Like a giant, whatever Comcast does from now on won't go unseen by the little people. Everyone will be watching. –JB

BellSouth Corp.

Defining the right strategy for DSL

Google Factor: 18,000

Last year: Not on list

In the race to reach broadband customers, DSL started out by digging its own hole. Inconsistent copper networks and inherently unstable telephone network topologies meant problems for the telcos in delivering a quality service on a consistent basis. Offering users nightmare customer service added fuel to the fire, and compounded their difficulties into an early lead for cable.

These are some of the hurdles facing DSL providers today, and at BellSouth, they're taking these particular issues head on.

To start, BellSouth has dedicated more resources than its larger competitors to reach more of its potential broadband customer base. Today, BellSouth has DSL coverage near 75 percent, a number most of BellSouth's fellow incumbent telcos are anxious to emulate, but are finding difficult to match.

The other major focus of the BellSouth DSL strategy is all about customer satisfaction, hoping to shed DSL's preconceived image of an accident always waiting to happen. At the network level, BellSouth has thrown money at the problem of poor network performance, investing in elaborate IP performance management.

By devising and sticking to a smart plan for consistent, steady DSL growth, BellSouth has carved out its own place in the market for competitive broadband services. –DH

Liberate Technologies

Securing a prosperous future playing the OSS game

Google Factor: 14,900

Last year: 12,300

The future for Liberate might not look much like its recent past. But by expanding its portfolio of operator software platforms this year, the company is in the enviable position of meeting near-term demand for software that cuts across multiple levels within cable operator networks.

Everybody knows where Liberate has cut its teeth–raising cash and developing middleware platforms for digital set-top boxes to usher in interactive TV services.

But something happened along the way, and Liberate has skillfully maneuvered itself into a smart position. While the industry waits (and waits) for compelling interactive applications to take off, making ordering pizza, movies and games through the standard set-top box a reality, Liberate didn't sit still waiting for interactive demand to catch up with the technology.

In August, the company used some of the cash it had built up to acquire service management software provider Sigma Systems. By venturing into digital network infrastructure, Liberate adds a voice and data management piece to its core video-based interactive services.

And as operators struggle over the next year to increase operational efficiencies ahead of some of these advanced services, they'll be more inclined to purchase systems that can drive efficiencies through automated service management. Interactive will be on the back burner (again), but Liberate is poised to be a leader beyond interactive platforms because of its foresight. –DH

Microsoft TV

New lease on iTV

Google Factor: 14,300

Last year: 348,000 (Microsoft Corp.)

Over at Microsoft TV, the interactive wheels might be spinning, but at least they're moving.

To date, Microsoft's venture into television and interactive subscriber services has been met with indifference. In the beginning of the company's foray into interactive television, Microsoft thought the transition from PC operating systems to TV-based platforms for similar services would be smooth and relatively pain-free. It wasn't.

Microsoft TV's only real thick-client software deployment to speak of–in some idyllic Portuguese system we've only read about–is a running joke because it reportedly crashes more often than Windows.

Microsoft TV has taken an optimistic tone lately with regard to its interactive platform, and refocused that division on goals it can immediately achieve with operators. Central to that is Microsoft's new thin-client IPG (interactive program guide). It's not the soup-to-nuts interactive TV platform that Microsoft once envisioned, but it should provide something of a start.

Outside of the TV division, Microsoft has ambitious plans for its gaming console, Xbox. One of the truly impressive capabilities of the console is the ability to enable broadband-based, multiplayer gaming. The Xbox might just be the Trojan Horse the company has been seeking to get into consumer's living rooms, where control of all things media really resides. –DH

ADC Telecommunications

Thinking big–and small

Google Factor: 13,500

Last year: 8,390

After getting into the cable modem termination system business back in September 2000 with the acquisition of Broadband Access Systems, it looks like ADC's decision is finally starting to pay some serious dividends. By the second half of 2002, ADC had risen to second place in the sector with $34.6 million in CMTS revenue and 19 percent of the overall CMTS market, according to Gartner Dataquest figures. That still lagged well behind Cisco's respective $104.3 million and 57.3 percent share, but it did loosen Motorola Broadband's historically firm hold on the slot. Gartner also noted that ADC's total revenue for cable broadband access gear at the first half of 2002 was already more than double its total revenue in that area for all of 2001.

This momentum can also be linked back to ADC's decision to think big and small when it comes to the CMTS. The Cuda 12000 is the big box, a "carrier-class" CMTS that will play a significant role in advanced data applications as well as forthcoming primary-line IP telephony services.

Meanwhile, ADC's smaller box, the Cuda 1000, targets small cable systems (about 2,000 cable systems serve less than 20,000 homes) and the multiple-dwelling unit sector. Cable operators might also employ the "baby" Cuda for so-called "second-line" VoIP services, as well. –JB

Scientific-Atlanta Inc.

Unwavered on cable

Google Factor: 9,430

Last year: 8,670

In an age when equipment vendors are downsizing and refocusing their efforts on a single core market, Scientific-Atlanta can perhaps take solace in the fact it never strayed from its focus on the cable industry. Unlike so many others, the company never wandered off into the seemingly huge telecom market, opting instead to stick with the customers and industry it has known for so long.

From set-tops to headend and transmission gear, S-A remains as one of two full-line equipment suppliers. Yet some like the fact the company wasn't taken over by another, larger, equipment vendor that would have distracted it.

That's not to say the company hasn't taken a couple of blows on the chin. Cable operator capital expenditures are down. As a result, S-A was forced to tinker with its organization: it had to shut down a production shift at its Juarez, Mexico set-top manufacturing facility and then announced a restructuring of its domestic organization, which resulted in a six percent headcount reduction.

S-A CEO Jim McDonald, however, has aligned his company's products to enable cable operators to launch on-demand programming, allow home storage and home networking, and roll out high definition TV.

The Explorer 8000 features an integrated PVR, while the 4200 includes a DOCSIS cable modem. Meanwhile, it won some more digital business when Cablevision Systems turned to S-A after the MSO slowed deployments of the Sony set-top box. Additionally, S-A has shipped about 90,000 high definition TV boxes to its customers who are deploying that service. –RB

Adelphia Communications Corp.

Shockwaves continue to reverberate

Google Factor: 8,120

Last year: Not on list

While most of the companies on our Broadband 50 list are making positive contributions to the advancement of broadband, Adelphia Communications is included because its implosion and ultimate bankruptcy are reverberating across the cable landscape.

Fair or not, Adelphia is cable's poster child for corporate corruption and investor swindling, single-handedly getting the cable industry caught up in the corporate meltdown that has brought down the likes of once high-flying Enron, Worldcom, Tyco and others. As an operator once-admired for its aggressive growth during a period of great consolidation and promise, Adelphia's fiery crash into bankruptcy has meant that every operator has had to reassess its practices and culture, and go the extra mile to prove that it is a different animal than the one everyone keeps reading about.

Today, Adelphia is trying desperately to dig out, but it won't be easy. Adelphia has had to suspend all of its capital projects, impacting its high-speed and digital growth. Adelphia wasn't the only company to feel the impact of its economic problems. More than a few–including Scientific-Atlanta, Arris, CSG and CommScope–have specifically cited the Adelphia bankruptcy as having a particularly negative impact on specific segments within their quarterly financial numbers. But these companies are not alone . . . The Adelphia story is one that the entire cable community will be fighting against in an effort to repair the industry's tarnished image. –DH

Broadcom Corp.

All that and a bag of chipsets

Google Factor: 11,200

Last year: 16,100

Broadcom Corp. has been chipping in wherever it can for years now, making semiconductors for cable modems, cable modem termination systems, digital set-tops, enterprise networks, servers and home networking gear. Although Broadcom is meeting stiff competition in some areas after being cable's dominant chip supplier, the Irvine, Calif.-based firm has held its own and expanded into other markets along the way. Hordes of technology companies have been stung by the economy and seen their stock prices plummet, but Broadcom shares have managed to stay in the double digits, trading at almost $15 at last check.

Figuring that it can parlay its cable industry success to other broadband sectors, the company recently took the covers off a line of chips designed for DSL networks.

Part of Broadcom's recent resilience can be anchored to its DOCSIS 2.0 efforts and its poaching this summer of Richard Prodan, a former CableLabs CTO, from Terayon Communication Systems. He became the company's new vice president and chief scientist, broadband communications.

Broadcom stands to get some fairly quick results in its DOCSIS 2.0 endeavors. Three cable modem suppliers that use Broadcom silicon–Motorola Broadband, Scientific-Atlanta and Xrosstech–submitted models for DOCSIS 2.0 testing in CableLabs' certification wave 24, which is scheduled to end December 13.

Meanwhile, Broadcom's Propane software, which triples cable's upstream path without a physical upgrade, is also gaining traction with vendors. ADC, Arris, Com21, Scientific-Atlanta, Tellabs and Thomson Multimedia have already agreed to fuel their DOCSIS products with Broadcom's upstream widening software.–JB

Linksys Group Inc.

Cozying up to cable

Google Factor: 6,960

Last year: Not on list

For a while at least, home networking and the market for personal connectivity gear seemed mired in the "down the road" category of mainstream technologies.

Well, the past year has seen that market do a 180, and it's in no small part attributable to the introduction of simple home networking gear from Linksys, via retail.

Now, cable is interested in the home networking space, and Linksys is greasing the skids of that channel as well. Specific to home networking, Linksys and AT&T Broadband hooked up last year on a program to resell Linksys home routing gear to cable modem subscribers.

Having a relationship with the MSOs will prove invaluable for Linksys moving forward, especially as the cable modem and home networking worlds get set to collide under the new CableHome efforts at CableLabs. Having one foot in both worlds makes Linksys an extremely attractive partner for MSOs looking to capitalize on the CableHome specification, and that effort is on the cusp of seeing some serious momentum over the coming year.–DH

TiVo Inc.

Time shifting into overdrive

Google Factor: 6,440

Last year: Not on list

You know a technology has made it to the mainstream when the brand name becomes a verb in and of itself. The verb "to TiVo" has not only entered the American lexicon, it has literally changed the way some people now consume television programming.

People with personal video recorders, though still a small subset of the entire viewing public, have guaranteed that "time shifting" of television programming is here to stay, and that the next generation of consumer electronics and set-tops are sure to have some form of PVR capability.

Out front of this movement is TiVo, whose patented digital video recording technology is finding its way into a quickly growing number of consumer living rooms. First to market and maintaining a healthy advantage over competitive DVR brand ReplayTV, TiVo itself is growing as consumers become ever more comfortable with the idea of customizing their own personal programming amid a sea of expanding channels and content. It is here to stay.

To this point, TiVo has played in the retail channel, but pay and enhanced TV providers have taken notice, and are anxious to give their subscribers that same level of control. This is the next step in the TiVo evolution–integration with familiar CE devices and dissemination through provider channels.

So far, TiVo's flirtation with the cable providers has been a bit limited. AT&T Broadband has been out in front, offering customers a TiVo sidecar to its digital cable set-top box. But the sidecar approach clearly is an interim step, as MSOs begin deploying integrated PVR set-tops. –DH

EchoStar Communications Corp.

Deal dead, but cable feels footsteps

Google Factor: 6,710

Last year: 4,640

Charlie Ergen definitely has guts, and that's just what the satellite pay TV industry needs as it pursues a legion of disaffected cable customers.

It now appears that his ambitious bid to acquire fellow DBS provider DirecTV will be thwarted by the regulatory channels within the government, due to fears of anti-competition for subscription TV across America's heartland.

Cable operators should be breathing a sigh of relief . . . If Charlie can spook cable's ruling class with creative marketing and pricing via the relatively small vehicle that EchoStar is currently, imagine the possibilities if the entire DBS sector were guided by him.

When cable operators today report sliding sub numbers and service churn, the usual justification is loss to DBS competition. Knowing how fickle the consumer market can be, Ergen has positioned EchoStar as more than a reasonable alternative to cable. Consumers today think DBS is better.

Want less up front cost? EchoStar offers free installation and free equipment deals. Want service on more TVs in your home? EchoStar is pushing cheaper receivers and deals on service to multiple TVs. Want a box with personal video recording capabilities? EchoStar offers up a satellite receiver integrated with PVR.

The strategy today by cable operators is to hold off burgeoning momentum from their satellite competitors. That in and of itself is testament to what EchoStar has accomplished so far.–DH

Motorola Broadband

In the thick and thin of it

Google Factor: 5,050

Last year: 3,730

Although Motorola Broadband's influence and technology touches all ends of the cable spectrum, its digital set-top efforts probably remain the most intriguing subject to cover.

Thick, thin, stout...The size and overall capabilities of Motorola's digital box line runs the gamut. Further down the road, its media centers and complimentary and networked baby boxes–once costs become more palatable for MSOs–will help cable operators offer an advanced "whole-home" entertainment offering, complete with digital video recording capabilities. But, in the here-and-now, the DCT-1700–Motorola Broadband's new, ultra-thin (and less costly) box–will play a role in how many operators fend off DBS with a multiple-TV, digital programming experience that can be marketed to customers without breaking the bank.

Motorola is also whetting consumer appetites with digital set-tops tagged for the retail realm. Its ultra-cool (but kinda pricey) DCP501, which comes equipped with a DVD player and home theater system, is already being sold by two retailers in Cox Communica-tions' Hampton Roads, Va. market.

Set-tops aside, Motorola continues to make strides with IP data. In addition to regaining its mantle as the leading shipper of DOCSIS modems in North America, Motorola Broadband has also moved ahead on more advanced products tied to home networking and IP telephony.

On the network side, Motorola Broad- band has also carved out a nice DOCSIS cable modem termination system business. –JB

Harmonic Inc.

GigE for you and me

Google Factor: 4,580

Last year: Not on list

Although the fiber sector has taken its share of hits recently, transport technologies such as Gigabit Ethernet have hit back with a vengeance when it comes to services like video-on-demand. GigE, more flexible than traditional transport methods such as direct QAM (quadrature amplitude modulation) and ASI (Asynchronous Serial Interface), supports data transfer rates of up to 1,000 megabits per second–the kind of rates and more centralized architecture that cable operators require for diverse on-demand libraries that feature much more than a selection of recent box office hits. Perhaps more importantly, GigE offers lower costs than the legacy methods.

One company leading the way in this area is Harmonic Inc., which has complimented its optical and broadband ware with GigE products for cable operators. At least two MSOs–Cablevision Systems Corp. and Charter Commun-ications Inc.–have already tabbed Harmonic to support their GigE deployments. It's likely that there will be many more to add to that list in 2003 as VOD technologies mature.

That said, Harmonic won't be alone in its GigE endeavors. It will face some tough competition in 2003 from younglings such as Internet Photonics and Manticom Networks, as well as from well-entrenched cable transport folks like Motorola Broadband and Scientific-Atlanta. –JB

C-COR.net

Spreading its international wings

Google Factor: 5,110

Last year: Not on list

The technology sector was hit hard again in 2002, and few companies were spared from its wrath, but that didn't stop C-COR.net from looking ahead and carving out some new business opportunities for itself.

The company made its boldest move in July, striking a $78 million deal to acquire Philips Broadband Networks (PBN), a division of Royal Philips Electronics that made both optical and RF transmission equipment for cable operators. At the time, C-COR said the deal would add about $100 million in annual accretive revenue and widen the company's international scope by three-fold.

Though College Station, Pa.-based C-COR.net conjures up images of nodes, amplifiers and other broadband gear (not to mention the Nittany Lions of Penn State), the company's broadband service divisions are nothing to sneeze at, either. C-COR is also trying to help MSOs save money by automating some of their operations. Time Warner Cable, as one recent example, is using C-COR's Integrated Services Management (ISM) Mobile Workforce Manager to automate fulfillment in Greensboro and Winston-Salem, N.C., a site where TWC currently offers advanced services such as video-on-demand. With expected completion in January 2003, the system will help Time Warner Cable streamline the paperwork for a field workforce that executes roughly 600,000 customer work requests each year. –JB

Toshiba America Information Systems Inc.

Outranking, outflanking

Google Factor: 4,360

Last year: Not on list

Over the past year or so, normally CE-centric Toshiba has shown that it is a major player in the market for cable modem technologies, and it's done it through the typical operator-led channels along the way.

In the first quarter of 2002, Toshiba briefly usurped industry stalwart Motorola in terms of the number of cable modems sold in the U.S. For a quarter at least, it was the equivalent of knocking out the biggest kid on the block.

Toshiba has been first a couple of times in the specification game as well. The company's PCX2500 was the first cable modem to receive Euro-DOCSIS 1.1 certification, and it was also the first modem ready for production after getting DOCSIS 1.1 approval as well.

Toshiba is hoping some of that MSO success translates into momentum for its next-generation home networking solution, too. Its new PCX5000 Wireless Cable Modem Gateway is aimed at operator demand for a simple home networking gateway that can easily be introduced into the subscriber channel with little heavy lifting.

The PCX5000 gateway includes both wireless and wired networking features, in combination with a DOCSIS cable modem and a wireless router. Toshiba smartly includes a self-installation tool, The JumpMaster, which MSOs will likely require so as not to burden their operations channels with another installation headache.

It's a full package, and that's just what MSOs will need (and ask for) as they move forward with home networking. –DH

Liberty Media Group

Circling the iTV wagons

Google Factor: 3,310

Last year: Not on list

When it comes to interactive services, and the time when cable operators will become infused with enough zeal for iTV to deploy platforms on any meaningful scale, the key is a demonstrable business case–and a matter of priority.

And, unfortunately, interactive is pretty far down the list of current operator priorities.

Because major interactive deployments to this point have been relatively scarce, companies that were early to the iTV party had faced uncertain futures and cash flow shortages.

Then, earlier this year, Liberty Media's chairman–the mythic Dr. John Malone–seemed to throw a lifeline to the interactive TV industry. Over the course of the year, Malone has brought iTV software companies Wink, OpenTV and ACTV into the safe Liberty Media fold. Now, the thinking goes, with less pressure to develop products that can quickly return investments, the companies will be more inclined to develop strategies for sticking around for good.

In acquiring OpenTV, Wink and ACTV, Liberty has creatively freed up some cash, with speculation that the maneuvering is in advance of an even bigger move.

Liberty has poked around some European cable properties, and it could be that acquiring cable systems is part of the plan. Some have suggested that Malone could enter the bidding for Hughes Electronics' DirecTV unit.

But at the tail-end of its iTV shopping spree, it just might follow that Liberty has eyes for Gemstar-TV Guide, the biggest prize in the interactive program guide market. Liberty once held a major stake in Gemstar, and the Liberty executive guiding the company through its current strategy, Peter Boylen III, is a former co-president and co-COO at Gemstar.

Might these synergies materialize into a merger some time next year? –DH

Gemstar-TV Guide International

Unique position with new services

Google Factor: 4,320

Last year: 2,140

Though there are more than a few people in the cable industry who hate to admit it, the future of advanced services like video-on-demand runs right through Gemstar-TV Guide. As a dominant force in the market for interactive program guide technology, there's really no dismissing the impact the company can potentially have going forward as the true gatekeeper between cable operators and the customers who access their services.

By ruling with an iron fist, Gemstar-TV Guide has secured its place–for now–as the guide all advanced services developers must interoperate with if they hope to dent the MSO market in any meaningful way. And make no mistake about it . . . The IPG is the portal by which subscribers interact with their cable service, and the introduction of offerings like VOD. In other words, all advanced services roads will go through Gemstar-TV Guide.

The winds of change are blowing, and to Gemstar's credit, it is undergoing change in a very public way. After coming down on the wrong side of the litigation dance, much of the leadership has been replaced. The company has also made some public overtures that it's working to integrate VOD and interactive hooks into the next version of the guide.

Its current position of strength should carry over into the next generation of advanced cable services–if it continues to read the winds of change correctly. –DH

Concurrent Computer Corp.

Movies today, everything else tomorrow

Google Factor: 2,430

Last year: 1,910

In the extremely competitive game of video-on-demand, Concurrent Computer Corp. has remained strong and kept pace with the other leaders in the sector, continuing to win VOD deals and deploying its gear with top MSOs such as Comcast Corp., Charter Communications, Cox Communications, Mediacom Communications and Time Warner Cable.

But remaining in the game will be a major challenge for the entire VOD vendor category in 2003. Some companies will likely be bought, while others just dry up and fade away. The entire VOD sector took a big slap to the face in May when Diva Systems, buried under $500 million in debt, filed for bankruptcy, then tried to work a $40 million assets-only deal with Gemstar TV Guide International. Gemstar later scrapped the whole deal, leaving Diva and its investors still twisting in the wind.

If the VOD sector suffers additional setbacks or embarks on a consolidation craze in 2003, don't expect Concurrent to play much part in it, unless it's playing the role of aggressor.

In addition to avoiding the economic problems that plagued Diva, Concurrent has also managed to insulate itself from the patent wars waged between VOD rivals nCUBE Corp. and SeaChange International. That's primarily because Concurrent's alliance and investment in U.K.-based Thirdspace Living, a supplier to video server system software for IP-based VOD services, gave Concurrent access to Thirdspace's patent portfolio and pending patents. That portfolio is also shared by nCUBE, whose majority owner, Oracle Chairman Larry Ellison, also has ties to Thirdspace because (stay with me here) Oracle is one of Thirdspace's joint venture partners.

Concurrent's relationship with Thirdspace will also help Concurrent expand into international markets and build relationships with non-cable video service providers.

Concurrent's efforts in the "everything" on-demand and network-based DVR sphere are also intriguing. Although the xOD category is a hot one, it probably won't be much of a factor until late next year, after the technology (and the business models) around it are allowed to "cook" a tad longer. –JB

Arris Group

'Hello, (cable) operator?'

Google Factor: 2,040

Last year: 1,976

Emerging as a "real" company after being born as a joint venture between Antec and Nortel, Arris has jumped to the forefront of advanced high-speed data and cable telephony service provision.

From its start-up as a provider of cable telephony gear, Arris has widened its scope to include high-speed data and packet telephony services, traditional cable outside plant hardware, operational support system software and a variety of other services as well.

But when it comes to cable telephony, no one's bigger than Arris–a $500 million deal with Cox, announced last month, cemented its position as the leading provider of telephony gear to cable operators. That's the good news.

But on the other hand, Comcast has publicly disclosed its decision to go slow on telephony service rollouts after merging with AT&T Broadband. That's a sour note because AT&T was the biggest provider of telephony-over-cable, with 1.3 million subscribers.

On the data side, Arris' acquisition of Cadant (a member of last year's Broadband 50) gives it a high-quality CMTS to offer as a platform for eventual migration to voice-over-IP. From a DOCSIS qualification standpoint, both the Arris Cadant C4 CMTS and the Cornerstone CMTS 1500 have been qualified for DOCSIS 1.1. In fact, the CMTS 1500 has been qualified twice, and the C4 three times because of new software versions.

But that good news is tempered by cable operators' seemingly slow deployment of 1.1-based equipment. That has allowed Arris' CMTS competitors to "catch up" to the company's lead (it was among the first to get qualified). Most major MSOs suggest that those rollouts will begin in earnest in 2003. If that's to be believed, Arris stands to benefit–if it can compete on price.–RB

SeaChange International Inc.

VOD, and then some...

Google Factor: 1,770

Last year: Not on list

The demise of Diva Systems opened the door of opportunity for just about every video-on-demand vendor, but it was ever so the case for SeaChange International Inc.

Although SeaChange missed the boat on Charter Communications, which spread the wealth to Concurrent Computer Corp. and nCUBE Corp., it did get all of Insight Communications' business, comprised of 10 VOD markets. SeaChange also picked up two existing VOD sites from AT&T Broadband, which will figure into the VOD vendor's long-standing relationship with Comcast Corp.

In the meantime, SeaChange is staying a step ahead of the curve when it comes to creating software that aims to deliver a better VOD experience to consumers as more content becomes available. Its VODlink software suite will add DVD functionality to legacy digital set-tops and give programmers the ability to create on-screen "overlays" designed to replicate a network's look-and-feel, even in a VOD environment. Available in January, VODlink will also give operators the tools they need to better organize a deep library of VOD content and link to special promotions and tie-ins. –JB

MagRack

Let them eat unique (and 'free') VOD

Google Factor: 1,890

Last year: Not on list

It's been clear for some time now that video-on-demand can't live on movies alone, and that pay-per-view on steroids just won't give cable the long-term VOD muscle it needs. Subscription-VOD services and programming from HBO, Showtime and Starz! has certainly created interest in the on-demand category, but even that might leave some viewers longing for more.

Enter "free" on-demand, a value-added carrot laced with programming that aims to lure digital cable customers in droves, and retain them just the same. Although several programmers are re-purposing their libraries for an on-demand environment, one, MagRack, is coming at it from a vector that is both free and unique to the customer.

Expected to end 2002 with as many as 40 programming categories, MagRack, like the name implies, offers oodles of niche, hobby and lifestyle content.

MagRack has yet to share any hard and fast numbers that prove how effective the service is at reducing digital churn, but recent data has shown that its popularity among Cablevision Systems Corp.'s iO-Interactive Optimum customers has jumped since launch. By August, MagRack reported that 87 percent of Cablevision customers with access to the service viewed it at least once a month, and that MagRack programming comprised just a tick above 10 percent of the total VOD usage on the iO service. –JB

Motive Communications Inc.

Broadly jumping in to full service software

Google Factor: 1,250

Last year: Not on list

Austin, Texas-based Motive Communications made it onto this year's Broadband 50 list just in the nick of time. In fact, before announcing that the company was acquiring self-installation and provisioning software provider BroadJump, Motive wasn't close to securing a place on this year's list of influential companies in the cable broadband arena.

But what a difference a deal makes. Motive's core competency before taking on BroadJump was software products that ease the diagnostic and element management processes providers face once broadband service was up and running on the network.

But by adding BroadJump's sector-leading self-installation and automated provisioning platforms to its product mix, the new company is in a unique position to offer providers a one-stop shop for service activation, provisioning and network maintenance software. And it's just in time . . . Cable operators in particular are being pressed to squeeze more operational efficiencies out of their disparate networks. A platform that can unify the key elements of the broadband provisioning processes–from initial customer set-up, to lighting up network elements to support the new service, to remotely managing customer CPE through embedded and network-controlled diagnostic technology–is a welcome sight to operators looking to get their arms around all of their internal systems. –DH

MidStream Technologies

Picking the VOD lock

Google Factor: 1,190

Last year: Not on list

A quick look beyond incumbent video-on-demand vendors will reveal a band of bloodthirsty video server vendors that are trying to elbow their way into the cable club. Perhaps the hungriest of that group thus far is MidStream Technologies, a start-up that that could easily be named VOD's "Newcomer of the Year," if such an award existed.

MidStream has raised about $50 million and has continued to preach the virtues of standards-based VOD, an approach that could eventually allow its servers to find homes in new VOD sites as well as in those already populated by the incumbents. To that end, MidStream has made some extremely significant moves.

For starters, it has reached a non-exclusive deal with N2 Broadband, a VOD software and systems provider that has ties and relationships with several operators.

MidStream has already made enhancements to its IP2000-series video server, which features dual native Gigabit Ethernet ports. For instance, the company plans to introduce this month a "Hyperdrive" RAM-based product for highly-requested, "transaction-oriented" VOD content.

What's still not known is how much longer it will be before those efforts translate into deployments. Bellevue, Wash.-based MidStream has yet to announce any customers, but the company has at least six trials in the works with yet-to-be-named cable operators. –JB

Terayon Communication Systems

Onward, DOCSIS 2.0

Google Factor: 1,640

Last year: 3,730

It's a year later, and there are still three certainties in life: death, taxes and Terayon Communication Systems talking up DOCSIS 2.0.

Since the introduction of DOCSIS 2.0 and the inclusion of Terayon's once proprietary S-CDMA (synchronous-code division multiple access) modulation scheme, Terayon has claimed its cable modems and cable modem termination systems will hold a time-to-market advantage over its competitors.

Terayon backed up that bold talk in October when it became the first vendor to stick its neck out and submit both a cable modem (the TJ715) and a CMTS (the BW3500) for official DOCSIS 2.0 testing at CableLabs.

Looking beyond data, Terayon is also moving ahead on PacketCable, cable's specified infrastructure for IP telephony and other multimedia services. Already, Terayon has two models in for official PacketCable 1.0 testing: the BW3500 CMTS (again) and the TA 102, a home-side multimedia terminal adapter.

Though Terayon's cable modem shipments lagged earlier in the year (Kinetic Strategies reported that Terayon shipped a mere 15,000 DOCSIS modems the first quarter of 2002), it had rebounded nicely by the third quarter when it shipped 175,000 DOCSIS modems worldwide during the period.

It's easy to forget, however, that Terayon isn't a one-trick IP pony. Terayon will also figure into cable's HDTV rollouts, thanks to the CherryPicker, a digital video system capable of managing 16 HD streams. –JB

Nuera Communications Inc.

Ready for cable's IP era

Google Factor: 1,050

Last year: Not on list

The name might be new to many CED readers, but Nuera's gear is increasingly being found in headends and central offices as the slow shift to packet-based voice networks continues.

Aiming specifically at the PacketCable environment, Nuera recently unveiled its new ORCA RDT-8g and RDT-8v VoIP broadband access gateways. Designed for service providers who need to get a deployable, IP-based telephony service into the field before the complete Class 5 softswitch solution is available, the unit bridges the gap between the network and the PSTN through a Class 5 local exchange located in the public switched telephony network. Each RDT-8 supports 4,000 subscribers and a single chassis fits seven units to a rack.

Based on the PacketCable Line Control Signaling system, the RDT-8g supports the GR-303 PSTN interface used primarily in North America. Operators that deploy it do not have to abandon their original investment when migrating to the full VoIP softswitch architecture. With a software upgrade, the RDT-8 transforms into a softswitch-controlled trunking gateway.

The RDT-8 has completed interoperability testing with Class 5 switches from vendors such as Nortel, Lucent, NEC, Alcatel and Nokia. In addition, Nuera has performed interoperability testing with MTAs from vendors such as Motorola, Terayon, Thomson and Toshiba. Service providers in the United States, Europe and Asia have deployed the RDT-8 in trials, and are preparing for roll out to customers. –RB

Cedar Point Communications

Striving for simplicity

Google Factor: 779

Last year: Not on list

For new guys on the cable scene, Cedar Point has managed to turn more than a few heads. Important ones, too. Maybe that's because they took the time to listen to what cable operators had to say. Or maybe it's because they tapped several well-known industry icons to be their advisers. Or maybe–just maybe–the company has developed some technology that's both needed and wanted.

Aiming squarely at the telephony-over-cable market, Cedar Point has developed a "media switching system" that promises to eliminate those sticky integration problems that come with trying to tie multiple vendors together.

Key to Cedar Point's success will be the Safari C3 switch, which combines attributes of Class 5 voice switches with the elements in distributed VoIP networks. The platform combines a Call Management Server, Media Gateway, Media Gateway Controller, Announcement Server and Signaling Gateway into a single chassis capable of serving up to 100,000 lines. That potentially saves money, reduces time-to-market and simplifies the network.

Cedar Point first got our attention via its advisory board, which consisted of such well-known names as Wayne Davis, Steve Craddock, Walt Ciciora, Tom Jokerst, Richard Rexroat and Sid Topol.

Former AT&T Broadband executive Mark Dzuban chaired that illustrious group and then was hired as Cedar Point's executive VP of cable telephony deployment.

The company has announced field trial relationships with both Comcast (word is that the company is oh-so-close to getting started in Willow Grove) and MetroCast. –RB

David Fellows

A mighty fine Fellow

Google Factor: 944

Last year: Not on list

When CED staffers set out to build this year's Broadband 50, each editor started with a separate list of favorites, then a bunch of meetings were convened until one Top 50 list was compiled. Along the way, we made notes related to the merits of each entry. For Fellows, it was succinct: "Being CTO of the biggest MSO on the planet is definitely worth a special mention." And indeed it is.

Fellows was lured back into the cable TV corporate world in 2001 to help bring sanity to an AT&T Broadband that had spun out of control (he had become a successful venture capitalist after serving as CTO at Continental Cablevision). He made good on his promise to stay with the company after it merged with Comcast Corp. to become a multimedia behemoth sporting 22 million subscribers. That's impressive, considering that most people thought he, along with fellow Continental alums Ron Cooper and William Schleyer, were brought to AT&T simply to fatten the pig for eventual sale.

Unlike Schleyer and Cooper (who were rumored to be headed to Adelphia at the time this was written), Fellows will stay on at Comcast, where he'll be tasked with providing technical guidance through the massive digestion and integration process.

He'll have his work cut out for him. He'll help direct how Comcast will upgrade the 35 percent of AT&T's plant that hasn't yet been brought up to today's standards (a betting man would expect the new company to shed some systems). But he'll have to do so carefully: Wall Street and others will be closely scrutinizing the new company's financials to see if Brian Roberts and Co. can make good on their promise to improve margins and roll out new services at the same time. –RB

Magis Networks

Defining the future of wireless video distribution

Google Factor: 542

Last year: Not on list

As cable operators get set to bring home networking technologies into their operational fold, the first steps will be simple–offering basic routing gear to customers who want to share broadband connections, files or peripherals like printers. For operators, though, it is the first step toward a future vision where home networks and bread-and-butter video service collide in a network that distributes video and data throughout the customer home.

Unfortunately, that dream is a bit far from reality. But Magis Networks is on the case.

Magis has developed a wireless video networking technology roadmap, creating a chipset based on current transmission protocols like 802.11, HyperLAN2 and IEEE 1394 that begins to address some of the issues inherent to delivering video wirelessly. At the heart of the matter is quality of service (QoS)–a necessity guaranteeing certain levels of video quality delivery. But Magis believes it has overcome many of the QoS stumbling blocks by co-opting bits and pieces from currently standardized transmission schemes to come up with a unique delivery platform.

There is still a long way to go, it seems, but Magis has carved out a unique position going forward. First, it's secured a deal with Digeo, a maker of high-end media centers. And second, Magis has garnered financial backing from heavyweights like Motorola, AOL Time Warner, Vulcan Ventures, Hitachi, Panasonic, Sanyo and others. –DH

N2 Broadband

Seeking free agents for pitcher-catcher combos

Google Factor: 732

Last year: 85

Thanks to close ties to Time Warner Cable, N2 Broadband and its package of video-on-demand software and hardware blasted from the launch pad last year with both deals and deployments in tow. This year, N2 Broadband expanded its business quite a bit as its VOD wares found solace in many new homes, including systems run by Comcast Corp., Blue Ridge Communications, Cablevision Systems Corp. and Cox Communications.

While N2 Broadband did secure more business in 2002, its adherence to standards should help it win more in 2003. It's already well established that N2's portfolio complies with TWC's Interactive Services Architecture, but it's also working on compliance with recently released VOD specs from CableLabs that cover content metadata and video encoding and an asset distribution interface that's key to the secure pitching and catching of digital VOD content over satellite and landlines.

N2 Broadband is also closing in on becoming somewhat of a one-stop-shop for VOD. It recently formed a non-exclusive alliance with video server start-up MidStream Technologies, giving N2 one more piece to the overall VOD puzzle.

Looking further ahead, it will be interesting to see how prominent a role N2 Broadband will have at the super-stealthy MystroTV, AOL Time Warner's everything-on-demand venture. Although no one's saying much about MystroTV, we're already considering it, in terms of intrigue, the 2003 version of Rearden Steel. –JB

Rouzbeh Yassini

Broadband evangelist

Google Factor: 500

Last year: 283

Frenetic. Tireless. Evangelical. Driven. All are words to describe the "father of the cable modem," but none of those terms completely capture the essence of the man. Since his relatively humble beginnings as an engineer at GE a couple of decades ago, Rouzbeh Yassini has come to personify the cable industry's efforts to build a high-speed, packet-based network that features inexpensive, interoperable devices.

As "The Man" behind CableLabs' wildly successful DOCSIS certification program, Yassini has accomplished more in five years than anyone ever thought possible. The R&D consortium is about to embark on a combined certification program that will include a third generation of DOCSIS, and first takes on PacketCable and CableHome. Observers say Yassini and his team of "get it done" types deserve the credit for the program's success to date.

Yet Yassini is already looking to the future, having laid the foundation for a time when DOCSIS capabilities will become embedded in literally tens of thousands of devices. Once that day comes, Rouzbeh's dream of a universally connected world will be well on its way to reality.

Where Rouzbeh takes his lumps is when it comes to his venture capital company, YAS Ventures. By making behind-the-scenes investments in several software and hardware companies, some question his ability to remain objective when it comes to designing certification programs. In response, Rouzbeh notes that he's supervised by a certification board (made up of executives from CableLabs member companies) to ensure that he's not taking on God-like responsibilities. –RB

Jedai Broadband Networks and Narad Networks Inc.

Waking up?

Google Factor: 397

Last year: 126 (Jedai)

Like tiny Lilliputians trying desperately not to wake a sleeping Gulliver, cable operators are quietly marshaling forces and developing game plans to extend their networks and services to small- and medium-sized businesses that dot the landscape in and around their existing cable plants.

So far, they've been successful in not rousing the slumbering giant, otherwise known as the incumbent local telco. Speaking privately to cable operators, we're well aware that virtually every major MSO has built an internal team to go after these markets.

Poised to benefit mightily are Jedai and Narad, both of whom burst on the scene a couple of years ago with their sights set firmly on this market segment.

Last year, we put Jedai on the list because it had demonstrable products and a great story. The company added to the product story with the addition of industry vet Michael Pritz, who came on board as president and CEO.

This year, we're adding Narad in recognition of its products as well as a strategic alliance with IBM that will allow cable operators to offer premium IT services to small businesses. Cable operators will be able to segment their service offerings, which include high-speed data, virtual private networks and leased line services, and IBM services such as managed storage and high-quality IP-based business video services. –RB

Covad Communications

Competing in DSL's anti-competitive arena

Google Factor: 394

Last year: 2,750

There are few early arrivals left from the initial heyday of the broadband bubble. In fact, on the telco side, the only ones left are the monolithic ILEC providers that have bullied their way back into positions of monopolistic strength.

However, there are a couple of competitors that remain as thorns in the incumbents' sides, most notably Covad Communications. In the early stages of broadband's introduction, Covad was an aggressive competitor to the telcos, promising unprecedented network expansion and following an ambitious plan to bring competitive DSL service to consumers across the nation.

Covad's eyes clearly were bigger than its stomach, and the company paid the price for its aggressive strategy. Its business model centered on providing service over copper networks controlled by the very companies they were competing against–the ILECs–and incumbent reticence to comply with unbundling mandates drove companies like Covad into bankruptcy.

But surprisingly, it didn't mean the end of Covad. The company bucked the odds, and emerged from bankruptcy, albeit as a much smaller entity. Today, Covad's model of wholesale broadband access endures.

If it is to survive and flourish, a few things must fall into place. Its business model still relies heavily on access to ILEC network elements, so it must still move that mountain. Covad now has trained its eyes on the retail market, so it must find a way to trim operating costs and develop strong partnerships there. –DH

Digeo Inc.

Making media centers a reality

Google Factor: 479

Last year: Not on list

Cable operators are excited about the prospect of media centers. The concept of a rich, gateway-style set-top feeding content and data to a network of smaller, cheaper thin-client boxes is an ideal structure for MSOs looking to control costs, while still providing service to multiple TVs within a subscriber's home.

After a quiet development period, Digeo Inc. is today leading the way toward making the media center concept a reality. The company marked its emergence from stealth mode by acquiring fellow developer Moxi Digital, and combining intellectual properties to create the makings of an initial media center reference design. The next step in the process is getting cable's stalwart box makers on board, and Digeo has secured development deals with both Motorola Broadband and Scientific-Atlanta. In doing so, it's circumvented many of the issues with conditional access that have kept newer box technologies from finding their way into the market.

The major issue so far: cost. At a time when operators are under increasing pressure to trim costs, and retreat to technologies that utilize current thin-client set-top boxes, shelling out hundreds more dollars for a rich media center-type of set-top is unrealistic. Digeo's box and client costs will need to descend into reasonable territory if we're going to see any deployments of scale by MSOs. So far, only Charter has signed on to deploy the Digeo platform. However, that agreement should be taken with a grain of salt; both Digeo and Charter feed from the same trough–Paul Allen's Vulcan Ventures. –DH

MetaTV

Building an interactive platform

Google Factor: 365

Last year: Not on list

Operator momentum for two-way interactive television has understandably waned a bit, replaced by operator focus on delivering advanced high-speed data and VOD. But despite forecasts that suggest iTV deployments might actually happen in earnest in the 2004-2005 range, activity today continues around developing interactive systems that will serve as the groundwork of iTV tomorrow.

MetaTV is one interactive software developer with an eye to the future, with the luxury of having financial backing from some of the industry's strongest players.

One of the main hurdles interactive services must overcome is the multi-source nature of all the content that will make up the kernels of cable operator interactive platforms. MetaTV is taking on this issue directly, designing a system to support interactive services that utilize content from disparate sources, culling it all into a workable form and automating the process of turning that content into interactive applications. It's all pulled together into a single point of reference, a kind of interactive portal that centralizes all of the potential interactive functionality.

MetaTV would be lumped into one of a handful of ambitious interactive developers if it wasn't for all of the industry support it currently claims. Cox, in addition to inking deployment deals with MetaTV for iTV services, is a major investor. As is Comcast, which is tied to the company through seed money as well as board membership. Add in alliances with companies like Liberate, OpenTV, Worldgate, SeaChange, BigBand, N2 Broadband, Motorola, S-A and others, and MetaTV is carving out its own place in interactive TV's future–whatever that may look like. –DH

TVN Entertainment Corp.

Covering both sides of the VOD fence

Google Factor: 372

Last year: Not on list

Concurrent, InDemand, nCUBE and SeaChange weren't the only firms with video-on-demand ties to benefit from Diva Systems' long good-bye. TVN Entertainment, a VOD and pay-per-view content player based in Burbank, Calif., also got into the act in 2002, scoring business with former Diva affiliates Charter Communications and Insight Communications.

In one fell swoop, those additions boosted TVN's VOD footprint by more than 30 markets, complementing business already earned with MSOs such as Comcast Corp., Cablevision Systems, Mediacom, and with overbuilders Altrio Communications and Astound Broadband.

TVN's corner is bolstered by the fact that its business touches both sides of the VOD fence: content transport and content aggregation.

The heart of TVN's VOD technology is found in its Digital Content Express suite of technology, allowing for the safe delivery of digital VOD content. ADONISS (Automated Digital Online Network Interactive Scheduling System), meanwhile, serves as TVN's asset management and scheduling software platform. TVN also takes care of video encoding, considered an art of its own, internally, rather than sending it out-of-house.

On the content front, TVN's library is stacked with programming that touches all age groups, from children's programming to adult. Plus, it has everything in between, distributing movies for Hollywood studios, special language programming, and subscription VOD titles for the likes of HBO, Showtime and Starz! –JB

Navic Networks

Hitting the bull's-eye

Google Factor: 358

Last year: Not on list

After navigating down a long, dark road dotted with product announcements but no deployments, Navic finally had something to crow about when Time Warner Cable's Oceanic division in Hawaii announced late in 2002 that it was rolling out Navic's interactive TV technology.

Oceanic will actually use two Navic software applications, including: Audience Polling, which uses interactive, graphical banners containing questions or opinion polls during TV programs, advertisements and special shows; and Addressable Advertising, which allows advertisers to target specific groups of digital viewers with tailored promotions, interactive offers, links to television commerce applications, and instant access to on-demand content.

The software and apps can perform audience measurement by collecting tuner data, and can also measure EPG events, broadcast triggers, tuner utilization, video and audio status, response to promotions for commerce, VOD and IPPV. The addressable advertising function enables operators and advertisers to distribute promotional content to targeted groups of set-tops based on detailed anonymous profiles generated from multiple data sources, including viewership history, demographic and psychographic data, and set-top configuration and capabilities.

Going beyond that, Navic software allows an operator to manage set-top devices by enabling remote monitoring of device conditions, diagnostics, software configuration management, modular software upgrades, and automatic detection and support of peripheral devices. In addition, Navic's data infrastructure provides a means to deliver software upgrades that requires significantly less bandwidth than legacy systems.

These capabilities, once proven in Oceanic, have the potential to help MSOs garner additional incremental revenue (or reduce churn among existing customers), as well as lower the cost of operations by allowing for remote device management. Whether that comes to fruition in the early part of 2003 is suspect, but in the long-term, it'll be crucial. –RB

Stargus Inc.

An inside look

Google Factor: 185

Last year: Not on list

With virtually every cable operator now reaping the financial benefits of high-speed data deployments, it's only natural that they're slowly beginning to understand the underlying dynamics of the data traffic that's flowing over their networks.

What they're finding isn't pretty. Often, a tiny percentage of the users are gobbling up a huge amount of the available bandwidth. Some rogue users are out there, using software to "uncap" their modems, allowing them to run at lightning-fast speeds. In the meantime, just to stay caught up, cable operators are buying more CMTSs and T-1s to connect to the Internet.

To give cable system operators a bit more vision into what's going on in their networks, Stargus has written software that provides intelligent network management and planning exclusively for DOCSIS infrastructure and IP services. The CableEdge/Optimizer, the only DOCSIS-specific network optimization software, is designed to maximize the capacity, performance and reliability of existing HFC networks by continuously monitoring all the DOCSIS compliant devices in a network to identify, isolate and correlate faults, congestion, usage and problems.

Its expert system then provides intelligent operating recommendations to resolve the issues, ranging from changing the interface settings on a particular CMTS to identifying specific HFC components that are not operating properly.

This form of network intelligence will become increasingly important as cable operators struggle to reduce operating and capital expenses. Although Stargus isn't the lone choice in this product category, the company is led by cable industry veterans hailing from such places as RoadRunner, AT&T Broadband and Shaw Communications. –RB

Syndeo Corp.

Call management gear for cable

Google Factor: 102

Last year: Not on list

Cable operators are at different stages in their network evolution to voice services, specifically in their quest to be able to offer them over an all-IP network. While operators linger in an in-between stage trying to bridge legacy Class 5 infrastructure into next-generation networks, the softswitch gains an increasingly vital role in operator migration strategies.

Of the current crop of softswitch and VoIP gear makers, Syndeo has quickly separated itself as a company offering tailored strategies to the cable operator. It's at the forefront of creating the perception that today's softswitches can offer more than just simple Class 5 switch replacement.

Syndeo claims its Syion platform differs from other stop-gap softswitch technologies in that it delivers a Class 5/local exchange softswitch, as opposed to other Class 4, long-distance trunking-type technologies. Because of that approach, it's able to offer feature sets at the Class 5 level to potentially millions of subscribers. That capability is what cable operators will need to have if they hope to compete with entrenched providers in many of the markets where they plan to offer telephony service.

Further, Syndeo is backed by cable heavyweights like Comcast, Cox, AOL Time Warner, Rogers and Shaw. And with specific regard to cable's telephony growth, Syndeo has closely aligned with the PacketCable movement. Today, the core element of the industry's most watched PacketCable-based primary line IP telephony deployment–Comcast's initial wireline VoIP residential project–is Syndeo's Syion 426 Call Management Server. –DH

BigBand Networks Inc.

Striking up a broadband tune

Google Factor: 346

Last year: Not on list

It wasn't that long ago when BigBand Networks had its coming-out party, singing tunes about the big plans it had in store for cable operators that were having trouble coming to technical grips with deploying advanced multimedia services. Well, it's more than two years later, and BigBand has yet to disappoint. Since then, it has forged relationships, trials and/or deployments with a variety of MSOs, including Cox Communications, Rogers Cable, Blue Ridge Communications, AT&T Broadband (now part of Comcast Corp.) and Time Warner Cable.

While some startups have fallen on hard times, Redwood City, Calif.-based BigBand has managed to conjure up the cash it needs to survive and thrive. BigBand recently closed a $27 million round, raising its total funding pile to $57 million. Significantly, AOL Time Warner, whose MystroTV division is looking into the virtues of "switched" video technologies and what role they will have with network-based PVR services, contributed about $3 million more to BigBand's pot.

Though BigBand's Broadband Multimedia-Services Router (BMR) represents the hardware cornerstone of its business, the applications it has developed and is developing will closely mirror many cable operators will be deploying in 2003. In addition to its current suite of standard-definition grooming, HDTV, and ad-insertion apps, BigBand also carries a self-healing redundancy system for digital cable services, and has video-on-demand applications on its product roadmap. –JB

e-BOX Corp.

MPEG-4, anyone?

Google Factor: 32

Last year: Not on list

Japan-based joint venture e-BOX Corp. made a splash in March when it became the latest to embrace MPEG-4, a compression standard whose benefits include lower bit rates than its MPEG-2 cousin and the ability to create object-oriented content.

Instead of supporting MPEG-4 via vanilla, PC-based streaming applications, e-BOX's edict is to create a digital platform, soup to nuts, for broadband networks that run video-on-demand and other interactive applications and channel bandwidth-intensive high-definition programming. To help it reach that goal, e-BOX has enlisted a wide range of tech firms to provide all the technology pieces required to create an end-to-end MPEG-4 broadband puzzle.

Pioneer Corp. and Sharp Corp. are contributing cable infrastructure and digital set-top expertise, with National Semiconductor Corp. pitching in the silicon. e-BOX also tapped Sigma Designs to supply the MPEG-4 decoder and video processing technology, and closely-held iVAST Inc. to provide its encoding, authoring, playback and system software. Last but not least, CMC Magnetics is adding its manufacturing background to the mix, and Modern VideoFilm Inc. is supplying post-production services.

All e-BOX seemed to be missing was a well-heeled MSO to champion the cause. Well, as it turns out, it has that, too. Comcast Corp. is an e-BOX advisor. In addition to supplying technical support and helping e-BOX define its architectural requirements, the MSO is expected to test the technology in field trials, perhaps as early as the first half of 2003. –JB

Movielink LLC

Internet VOD: Cable friend or foe?

Google Factor: 19

Last year: Not on list

For a "soft launch," Movielink's introduction to some trial customers last month sure caused quite a stir in the mainstream media. Internet video-on-demand suddenly seemed so en vogue.

Movielink isn't the first Internet movie service to hit broadband, but it does boast the largest library of "quality" (and legally-obtainable) on-demand content available via the Internet today. That's what happens when a phalanx of major movie studios–including MGM, Paramount, Sony Pictures, Universal Studios and Warner Bros.–puts its collective money and muscles behind it.

If you question that kind of power, recall that it's the strength of the movie studios that brought Intertainer to its knees as the iVOD trailblazer mounts a legal offensive against some Movielink backers, alleging, among other things, a price-fixing conspiracy.

The Movielink service itself apparently hasn't worked out all the kinks, however. An early review from "Business Week" lamented long download times and sub par picture quality.

Still, the fact that Movielink can represent both content provider and gatekeeper should grab cable's attention. On a friendly note, Movielink's download now/play later rental service could drive cable modem subscriptions and give operators the "killer app" they covet. On the other hand, Movielink could also drive up operator network costs and move MSOs closer to a "byte-cap" model based on usage–a scenario that might irritate power users who are accustomed to cable's all-you-can-eat, flat monthly fee for high-speed data services.

Movielink's influence might also spread into MSO boardrooms, begging the question: will Movielink and its backers use this newfound leverage as a chit in their VOD and pay-per-view negotiations with cable operators? Stay tuned in 2003 to find out. –JB

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