In many countries, cable infrastructures have been the key enabler for multimedia services, and some leading players are already winning the broadband race with higher penetration within their footprint than telecom operators. In the last few years, cable operators have further increased their competitive advantage in broadband capacity, with DOCSIS 3.0 providing services up to 120Mbps.
Arthur D. Little’s new Industry Viewpoint “The Moment of Truth: Cable Infrastructure as a Competitive Next Generation Access (NGA) Platform in a Financial Crunch?” addresses the increasing attractiveness of cable infrastructure to ensure ultra-high broadband access, especially given the financial crisis around the globe.
The cost to upgrade existing cable access networks is about one-third the cost of FTTx deployment and, with this upgrade, cable will soon be able to offer a comparable customer experience to fiber in high-end data and advanced multimedia services. Furthermore, cable operators are already pursuing mobile opportunities through partnerships to counter incumbents' DSL/ fiber bundled offers.
However, operational excellence will be the key condition to convert these technological assets into market success. In particular, customer operation management and marketing often remain a weakness of cable operators. The success of any operator in any individual market will depend on its ability to continuously improve customer satisfaction and marketing capabilities.
“Technology alone will not be enough to be successful; operational excellence and branding need to be a part of the value proposition to end-users,” says Karim Taga co-author of the report and Director at Arthur D. Little’s Telecoms Information Media & Electronics (TIME) Practice.
Given the current financial crisis, Arthur D. Little advises all market players to shift their attention from cash intensive FTTH-only investment and to include cable infrastructure in their strategy to define NGA platforms:

• The financial community should re-think their investment strategy and shift their portfolio from FTTH-only investments to a more balanced NGA portfolio that includes cable infrastructures.
• Fixed operators, especially alternative operators, should consider the acquisition of cable infrastructure, if feasible, as opposed to deploying a fiber access network. If not, they should reassess risks to their business from cable.
• Mobile operators should consider an acquisition of, or a partnership with, a cable operator as an option for fixed market entry.
• Policymakers need to consider cable infrastructure as part of their NGA strategy, as cable infrastructure could provide a cost-effective platform for ensuring ultra-broadband access.
• Cable operators, apart from the continuing consolidation in order to establish a sizable footprint, must focus on improving customer excellence to fully leverage their assets. In addition, they need to preempt regulatory risk by proactively developing a wholesale offer, especially to mobile operators.

“The ability to finance investments will be critical during the current credit crunch and all players, including regulators, could benefit from including cable on their radar screen for NGA platform investments,” states Karim Taga, who is also Director of Arthur D. Little’s Global Technology Economics Competence Centre.
“The Moment of Truth: Cable Infrastructure As A Competitive Next Generation Access (NGA) Platform in A Financial Crunch?” is now available for download at