If you want to see what all-digital cable TV service looks like, you have only to look a bit north of the border.
While most major U.S. cable operators are still mulling a move to all-digital TV service, there has been an avalanche of rollouts in Canada in the past few months. Led by a cadre of MSOs, including Rogers Cable and Cogeco Cable, Canada's cable scene may offer valuable deployment and marketing models for staging all-digital rollouts in the United States.
Quebec-based Cogeco is among those leading the charge into the all-digital TV frontier. Using a simulcast scheme that duplicates existing analog channels, Cogeco started rollout of its all-digital service in mid-August, and so far the service is reaching 91 percent of its Quebec territory and a little more than 50 percent of its Ontario systems. With the exception of a few properties that are isolated from the MSO's central headend, plans are to bring it to all of Cogeco's territory by the end of the year.
Cogeco's decision to offer all-digital TV packages was driven in part by introduction of the sub-$100 Motorola Broadband DCT-700 digital set-top, and the fact that more customers are buying digital TVs capable of greater picture quality.
"It was a quality issue that became more of an issue as people started to buy bigger and higher-definition sets," says Denis Belanger, Cogeco's vice president of corporate engineering and development. "It's a combination of things that finally came together, where we said, 'OK maybe it is now the time to do it'."
Rogers Cable has joined the all-digital pack, debuting its simulcast service in July. It has steadily turned up service across its Ontario and Maritime provinces systems, with plans to be complete by later this month, according to David Purdy, Rogers' vice president of digital TV.
Rogers offers its all-digital customers.
"Especially for the last several months we have been outstripping our forecasted and budgeted digital numbers," he notes. With that and the rollout of a new HD-DVR box, "we're also starting to see a migration of satellite customers coming back."
Like Cogeco, the evolution of higher-quality digital TV boxes is a leading reason for the all-digital service rollout.
"I think for us, going all-digital is done because our own customers have said that they would like to have 100 percent digital picture quality and sound, and that many of them when they went out and purchased these HD-ready television sets felt that our digital signal looked better than our analog signal on these new TV sets," Purdy says. "I think we were trying to meet consumer demand, and competitive pressure not so much in this case."
Mountain Cable has launched
a major marketing push behind
its all-digital service.
The response was strong, to say the least, with supplies of DCT-700s exhausted quickly, says Bruce Marshall, Mountain's technical director.
"We put out more digital set-tops in the first two weeks in September than we did in all of last year. It just cleaned us right out," he notes. "We were completely unprepared for the success of the product launch."
For Mountain, going all-digital was triggered in part by introduction of lower-cost, high performance digital encoders–specifically, new products offered by encoding startup EGT Inc. That was particularly important because Mountain's southern Ontario territory sports some 20 off-air channels from Toronto to Buffalo, requiring more encoding equipment to process, according to Marshall.The simulcast road
In all of Canada's all-digital deployments so far, the MSOs have opted for a simulcast scheme, duplicating all of the analog channels in digital but not discontinuing the analog service.
"We are keeping (analog), and we made sure that when someone subscribes to our digital service, all of the services that the customer uses and experiences are received and distributed over a plant and received in digital," Cogeco's Belanger notes.
Mountain is also maintaining its analog packages, but "we are really encouraging customers to get onto our digital services," Marshall says. "So we've set up an affiliate program with the TV stores in our area, so that any customer that buys a large-screen TV, we will give them a DCT-700."
For Rogers, simulcasting also doesn't unduly force customers into a single service option, Purdy says.
"For those customers who prefer the simplicity and are used to using our analog product, they can continue to do that," he says. "And for customers that would like the incremental choice and control that comes with digital we can offer them 100 percent digital."
In addition, Rogers also is offering HD versions of channels, "so it is possible you might have three versions of the same channel," Purdy notes.The bandwidth load
But simulcasting does bring a major bandwidth load in duplicated channels. For the most part, the Canadian operators are using the latest in digital bandwidth management tools to cope with the increase.
Because most Rogers systems are now rebuilt to 860 MHz capacity, duplicating the 70 or so analog channels in digital shouldn't be a problem, Purdy says. It is further saving bandwidth by multiplexing two HD channels or 10 standard definition channels per 6 MHz channel. And Rogers also got a boost because of an existing time-shifting digital service, offering customers out-of-market signals.
"It wasn't a lot of incremental work for us, because most of these channels were being carried in that time-shifting package in digital already," Purdy says. "It was just a question of making them available in their local markets in digital."
Mountain banked on the fact its cable network uses all fiber-optic lines that radiate out from a central headend, with the last segment in short coax runs of less than a half kilometer. Its network is also running at 1 GHz capacity, Marshall says.
"The good thing is the whole thing is set out of a central headend, so it's relatively simple and easy to do, because the plant supports it very nicely," he says.
Still, carrying 13 HD channels does eat bandwidth, so Mountain has started stat muxing the channels. "There's really no other efficient way to do it," Marshall notes.
For Cogeco, the answer lies in newer statistical multiplexing equipment, which allows video streams to share the same 6 MHz channel. Depending on content type, the MSO is multiplexing 12 or 13 digital channels or up to three HD channels on a single channel, Belanger says. Over time, Cogeco will also likely add bandwidth by reclaiming analog channel space.
"I can't see 10 years from now, for example, that we'll still have to carry 50, 60 or 70 analog channels. It should be a reasonable but low number of analog channels at one point in the future," Belanger says. "But there is that transition that is not necessarily easy to manage, so you have to go through it."Low-priced offer
Another consistent trend among the Canadian operators is the idea of offering a digital service that mirrors the analog offering in programming and price.
For example, Rogers offers its basic digital at the same $23.99 price as the basic analog service, with the only difference being the digital customer buys or rents the set-top. Box rental starts at $8.95 for the entry-level SD box.
Similarly, Mountain's all-digital offering includes basic and extended packages identical to its analog service, with only a $3 price difference between the two. Basic analog cable TV costs $20.95, compared to $23.95 for basic digital cable plus the terminal, while the top-end analog package costs $42.95, compared to the same package in digital for $45.95.
The DCT-700 is offered at a deep discount as well. Mountain pays $130 Canadian (about U.S.$103) for each box, but it is offering them to customers for just $39.99 for the first unit and $69.99 for any additional boxes.
Mountain is keeping the equivalent digital and analog service prices close to attract the analog customer daunted by high digital tier prices and the need to buy a pricey set-top.
"Our thinking is, if the impediment is getting the terminal into the house, what if we have a low-cost terminal, subsidize it slightly and get the customer to become a digitally capable customer?," says Pat Kiely, Mountain's director of business operations and development. "Now the upsell doesn't involve the terminal; it doesn't involve those kinds of up-front costs."Analog not going away
And while the trend is toward all-digital in Canada, none of the cable operators involved see analog joining black-and-white TVs in the television technology graveyard any time soon.
One reason Mountain will have to maintain the analog signal is to reach the secondary sets in homes, since the DCT-700 won't pass through signals to those sets.
"Most homes that we are doing installations in now are typically three and four outlets as an average," Marshall notes. "That main, primary TV in the family room is the digital set and the other two outlets are typically analog TVs."
Similarly, Rogers is not in a hurry to turn off analog channels and reclaim that bandwidth. "Like all cable companies, we are constantly reviewing our spectrum plan and trying to figure out the best use of spectrum. But at this point we don't have any plans to harvest the analog capacity," Purdy says. "I think it is a question of consumer demand, the product offering and the competitive landscape that drives things. But at this point I can't see us harvesting the analog spectrum."