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Comcast to stay on the offensive, armed with upgrades and new services

Wed, 06/30/2004 - 8:00pm
Jeff Baumgartner

For Comcast Cable, the best defense against growing competition from satellite and phone companies is a good offense.

Such was the message here Wednesday at an all-day press briefing attended by CED at Comcast headquarters as many of the MSO's top executives presented some of the company's high-level service strategies.

Comcast said it is ready to move quickly with a variety of new services and applications because its extensive network upgrade - including those acquired from AT&T Broadband - is almost complete.

Comcast Cable President Steve Burke estimated that the MSO is about 98 percent finished with the rebuilds, with some work still to be done over the next three to six months in the California Bay Area, Chicago metro and in Miami.

"In our minds, the integration process [with AT&T Broadband] is over," Burke said. "Now we're in the process of acceleration and getting our company more competitive."

Taking the all-digital road

Comcast, like other MSOs, will continue to create a converged network based on IP techniques that provide the economies of scale and scope it needs for video, voice and data services. Part of that plan involves the much-discussed migration to an all-digital environment.

Near-term, Comcast plans to kick off that migration in a couple of markets by simulcasting analog channels in its digital spectrum, a strategy Charter Communications is employing in Long Beach, Calif.

Further out, Comcast will pin some of its all-digital hopes on low-cost digital set-tops that will come out of the Next Generation Network Architecture (NGNA) project, which is being headed up by Comcast, Cox Communications and Time Warner Cable.

"We're headed down the path of $35 to $50 set-tops," said Dave Fellows, Comcast's executive vie president and chief technology officer. He expects the first of those devices to become available sometime next year.

Comcast also revealed some forthcoming plans involving more efficient, next-generation codecs. Fellows said the MSO will launch a new version of compression in 2006. Though Comcast has yet to settle on a specific format, Fellows mentioned MPEG-4, Microsoft Corp.'s Windows Media 9 and the RealNetworks Inc. RealVideo 10 platform among the possibilities.

One MSO exec noted privately that Comcast will be able to make those selections without getting "locked in" by deploying set-tops equipped with software-based chipsets. That means a set-top running Windows Media 9 could be converted to another codec via a simple download to the box.

Video-on-demand

Comcast said it will remain aggressive with video-on-demand, and expects to have the service available to about 80 percent of its footprint by year-end.

Fellows said Comcast will continue to add free and pay content to the video-on-demand vaults. Comcast offers an average of about 1,500 hours of VOD content today, but is headed for 10,000 hours or more, he added.

Comcast has also embarked on some initial high-definition VOD testing in the Philadelphia area. For now, the company is offering HDVOD fare only in the pay category.

Comcast reiterated plans to complement network-based VOD services with home-side digital video recording technologies. Burke held hopes that at least 50 percent of Comcast's subscribers in five years "will be very active users of time-shifted programming" with VOD and DVRs.

Comcast plans to upgrade its Motorola-based digital set-tops to iGuide, an IPG developed in partnership with Gemstar-TV Guide, sometime in the next 90 days. Among the improvements: iGuide is 50 to 100 percent faster than the current "Tan" guide, offers a wider grid for an hour-and-a half-view of programming, and provides trick-mode capabilities for boxes with on-board digital video recorders.

Voice plans

Comcast also shed more light on its IP telephony plans. Today, the operator is conducting VoIP trials in the Philadelphia area, Indianapolis, Ind.; and, most recently, Springfield, Mass.

Comcast has about 650 customers on the service today, though the VoIP equipment already deployed in those test markets could support about 1 million homes passed. Next up, Comcast plans to test some new packages and marketing techniques for the service, said Rian Wren, Comcast's senior vice president and general manager of telephony.

Looking ahead, Wren said Comcast, if it so chooses, could be in position to offer VoIP in up to 50 percent of its footprint in 2005.

In the meantime, Comcast will not actively attempt to grow its circuit-switched subscriber base, primarily because the financial benefit of doing so is minimal. That's because Comcast still leases switches from AT&T in its constant bit rate phone markets.

"The arrangement with AT&T is not exactly what we would like. We think we could do better [financially] by controlling our own technology," Wren said.

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