December 1, 2006

Telephony: The Coming Year for Cable Voice Services

By Justin J. Junkus

The December column is traditionally a place to review what we’ve done over the year and make predictions. As I thought about cable telephony’s future, I was reminded of some observations by Jagdesh N. Sheth, a respected industrial marketing consultant to the telecom industry. Sheth has expressed the view that as any market nears maturity, you can expect three major players to service the customer base. He has been wrong on guessing companies (for example, in 2001 he predicted mergers of AT&T with Verizon, Sprint with SBC, and Worldcom with BellSouth), but this “law of three” seems to be taking hold for the number of landline telephony alternatives. Cable, telco and broadband telephony are the choices for landline service, and cable won a respectable share of several markets in 2006. To come up with a strategy for gaining more of the pie in 2007, it should be helpful to think about what we’ve done right this year and look at some new vendor offerings that might leverage our right choices into next year.

Carrier grade

First and foremost, we have positioned cable telephony as carrier grade service. That differentiates us from the broadband telephony providers. We engineer our critical network elements to deliver “five nines” of availability, and for the most part, they have met that promise. Going forward, we are growing at an unprecedented rate, and it’s probably a good idea to continually monitor call quality to ensure our scaling is correct. Testing against mean opinion scores (MOSs) at installation is becoming standard procedure, and embedded multimedia terminal adapters (EMTAs) can now feed back MOS and perceptual evaluation of speech quality (PESQ) scores to network management systems. A related process is stress testing to identify problem areas before they affect subscriber service.

In October, 2006, Montreal-based Minacom (www.minacom.com), soon to be part of Tektronix, began offering a system that it claims performs standards-based speech quality stress testing for up to 24 hours, with reports every 15 seconds on MOS, clipping, distortion, noise, packet transmission, and speech power. Michael Nadeau, president and CEO of Minacom, explains the value of this test. “Minacom’s VoIP stress-testing gives VoIP providers a reference-based tool to monitor VoIP service quality, similar to the way BERT (bit error rate test) is used to verify the performance of traditional wireline services.”

Keeping the return path free of ingress and other noise is also critical to carrier grade service. To improve on scheduled testing, Proxilliant (www.proxilliant.com) is marketing a system that not only monitors return path signal quality but also cancels the effects of noisy plant. The company maintains that its Cable Access Management System (CAMS) and the associated Intelligent Access Controller (IAC) improve performance by continuous analysis of return path RF, coupled with a cutoff algorithm that only allows an upstream connection when configurable conditions are met. Signals that meet DOCSIS specifications are therefore passed, but noise on idle legs is not. In a trial at Time Warner Cable in Brooklyn, NY, the reduction in upstream noise level at the headend was in the 7 to 10 dB range.

Rich Berthold, Proxilliant CTO, points out that the ability to detect problems down to a 30- to 40-home area is just as valuable as the noise cancellation. He says: “While there are several systems that monitor down to a node level, our IACs provide a higher degree of granularity. They can be physically incorporated into the amplifier just before the feeder and can therefore detect performance problems based upon a particular branch of the RF plant.”

Feature-rich services

Although carrier grade service differentiates us from the broadband telephony providers, we couldn’t have gained our market without feature-rich services for both residential and business markets. Switch vendor CedarPoint (www.cedarpointcom.com) has grown its business by providing a full set of them and looks forward to adding more business features in 2007. Says Dave Speer, CedarPoint EVP Strategy and Market Development: “By year end, there will be more than 1 million U.S. end users on CedarPoint switches and over 2 million licenses for lines. In 2006, we added Centrex IP services on the same platform as our residential offering, and IP PBX (private branch exchange) connectivity. In 2007, we look forward to providing more end user control with Web portal access and increased multimedia using SIP (session initiation protocol) endpoints.”

The commercial services market is going to be increasingly important to cable, and business solutions involving partnering between cable providers and third parties will become a key part of that activity. Whaleback Systems (www.whalebacksystems.com) is hoping to duplicate a three-way partnership between themselves itself, cable MSOs, and installation contractors. In Tampa Bay, Bright House broadband data customers looking for a hosted PBX solution were referred to Whaleback Systems, which provides this service over a broadband connection. Installation contractor Kablelink Communications installed both the data and voice broadband lines to the customer, along with customer premises equipment (CPE), and trained business customers on its use.

Third-party partnering will not be limited to business services, however. In 2006, our industry began serious investigation of IP Multimedia Subsystem (IMS) as an addition to PacketCable architecture, with a view toward increased participation from third-party application vendors. Although systems operators appear cautious about changing architectures to implement full IMS functionality, third-party vendors are already finding ways to add value to our telephony offerings.

Integra5 (www.integra5.com), for example, has been working with CedarPoint and other vendors to provide caller ID as part of TV viewing. CEO Meredith Flynn-Ripley referred to the results of a recent customer survey as an indication of what to expect in the future. “Consumers want to have any service available at any device. For example, 55 percent of the surveyed consumers want customer care messages available on the TV and PC.” In response, Integra5 is planning to add short message service (SMS) capability to TV display in 2007 in a customer care application. SMS has been a popular feature on cell phones for a number of years.

Bottom line

Voice services will continue to grow as a revenue source for cable operators and will include an expanded range of products. As CedarPoint’s Speer commented: “2006 was the year of the inflection point for cable voice services offerings. 2007 will be a statement.”

Justin J. Junkus is president of KnowledgeLink and telephony editor for Communications Technology. Reach him at jjunkus@knowledgelinkinc.com.