Cable companies may be able to adequately handle video, phone and Internet traffic today, but some competitors such as Verizon may be better equipped to handle the technologies of the future.
That’s the conclusion of a confidential research report from Louisville-based CableLabs, a nonprofit research-development consortium formed by the cable industry.
The findings of the report suggest that the cable industry may need to make additional investments to update its networks and provide more bandwidth to consumers. Those investments would come on top of the estimated $100 billion that cable companies spent upgrading their systems in the 1990s.
In a statement Thursday, CableLabs said it’s nearly impossible to predict future bandwidth needs and its research is speculative. The statement said any threat from New York-based telecommunications company Verizon is not immediate.
Verizon plans to spend billions of dollars in coming years to bring fiber-optic lines directly into homes to offer phone, Internet and video service at blazing speeds.
“The bottom-line findings of the technical research report demonstrate that cable’s technology is … well-poised to handle the capacity requirements of new services, and major investment is not needed for cable to effectively compete,” CableLabs said.
An explosion in bandwidth-intensive online activities, such as downloading feature-length films, is driving concern that customers will need faster speeds.
Cynthia Brumfield, president of Emerging Media Dynamics, an Internet-provider consulting firm, said that having available bandwidth will not be an issue for cable companies in the next five years.
“Cable is far from hitting a (bandwidth) ceiling,” she said. “In the future, there could be some development, making what is a reasonable amount of bandwidth today far too narrow.”
The Wall Street Journal reported details of the report in a story Thursday. CableLabs would not make the report available Thursday, and its chief executive, Richard Green, would not comment.
But Green told The Denver Post in January that cable companies were working to make video more attractive.
“We want to do more interactive services … and wireless services,” he said.
By the end of 2006, 50 million U.S. households will have broadband access. Of those, 28 million will use a cable modem, estimates The Carmel Group, with the remainder using DSL.
Cable companies that belong to the CableLabs consortium defended their networks in light of the report.
Comcast Corp., which serves 800,000 in Colorado, said the report doesn’t reflect its views on bandwidth capacity. The company has spent more than $600 million since 2002 upgrading networks in the state.
“Comcast’s major investment is behind us,” said chief technology officer Dave Fellows in a statement. “Our networks have reserves of additional capacity that can be tapped in ways that are not addressed in this report.”
Staff writer Kimberly S. Johnson can be reached at 303-820-1088 or kjohnson@denverpost.com.
