RDOF, Verticals and Value Adds reveal Cable’s fiber growth plans at the expense of rural carriers.

This was originally written just as COVID shut down the US. Fierce Telecom just reported Charter along with other MSOs have filed to take a piece of the $20 Billion RDOF! The following rural cable strategy was compiled from Heavy/Light Reading, SCTE, Deloitte, Garner and various other industry sources. At the end of the blog there is information on how to stop this attack, protect your current accounts, grow them, and acquire new ones. 

Justified by growing fiber valuations, MSO’s plan is to win rural commercial accounts by offering new services. Those same rising fiber valuations are inviting new competitors and cable’s trans-formative services are designed to beat both the incumbents and hold off new entrants. They say it’s easier to fight the enemy you know than the one you don’t. With uber competition confronting every industry, companies must invest to fight rivals. It is tough, challenging….yet strangely reassuring to take on familiar opponents. Focusing on traditional rivals has often blinded companies to the threat from new disruptive competitors. So what happens when your competitor changes to battle not just you, but threats from new adversaries?

New customers – What's Bright, Shiny & Not GEM?

Government-Education-Medical (GEM), the original commercial  sector mantra for the cable industry, has served them very well over the years. Broadband Success Partners captured both quantitative and qualitative answers to MSOs targets from interviewing Tier1/2 market executives.  As the survey confirmed GEM dominates the cable’s business services, with hospitality emerging as a close fourth. Cable's legacy GEM focus clearly continues to pay dividends and as an executive noted “These verticals frequently utilize cloud services that require high speed connectivity and reliability, including SLAs." But other verticals are now popping up too.

Which are the newest verticals with promise?  The array of responses shines a bright light on areas where MSOs seem particularly well suited. For example, agribusiness is hot and getting hotter, especially where farmers need access to gigabit speeds that enable them to leverage new technologies. "The early returns are extremely positive," according to one of the Cable executives. Consider this agribusiness IoT use case: crop yield improvement with industrial tilling equipment that drops one of three different types of seeds based on real-time soil acidity readings.

Keeping with the IoT thread, energy-utilities and manufacturing are newer verticals for cable to provide services for telemetry devices. Amenity WiFi and capturing data and using analytics to learn more about their customers behavior is increasing bandwidth demand for all retailers.

US cable operators are making progress in their pursuit of lucrative, enterprise services deals, but their bread and butter continues to center on small and mid-sized companies.[ii]  Cable is seeing a 5% rate of revenue growth, much of it from Tier2/3 markets meaning there's still plenty for cable to pursue.  Some such as Comcast has seen an 8.8% commercial business services growth.

Getting More out of Current Customers – The Total Connect Affect

How is Cable Planning on driving increased revenue when bandwidth pricing is falling? "Make new friends but keep the old. One is silver, the other is gold." Just like this lyric, cable operators are changing to mine current accounts while embracing the new verticals.  The cablecos are committed to adding more value for the current services.  Their objectives are reduced churn, increased usage, attract new accounts, and stave off threats. As evidence of this commitment MSOs have released new service portals for client interaction such as Comcast’s Service Portal, Cox EPMR Portal and Spectrum’s Total Connect[iii].

In January of 2020 Spectrum released Spectrum Total Connect.  The platform has been even more valuable during the COVD era and includes:

  • Custom internet solutions designed for each business, including streamlined billing, 24/7 support and project management – all from one provider;
  • A variety of internet plans, including Spectrum Business Internet Gig, with speeds up to 940 Mbps;
  • Online management tools to help businesses monitor service requests, service levels and more.

Cable's Expanding Fiber Investments and Services

As the MSOs are gearing up for a new decade of jousting with telcos and new rivals they are steadily pumping more fiber into their access networks. There remain many questions about how cablecos intend to take advantage of their increased fiber investments.[iv]

The SCTE Heavy Reading Survey identifies the key focus areas for cable’s heavy investment in fiber builds.  They believe they can expand their business market share through increasing fiber deployments for 10GigE services and 5G backhaul deployments. In fact 62% of cable companies expect to upgrade their networks within the next 2 years for 5G backhaul (over 60% of respondents were Tier 2/3 market operators).  Regional carriers have several steps they can take now to counter this offensive being launched by your legacy competitor as well protecting you from the new disruptors.

What Can Telcos do now?

As the CableCo’s realize investing in a customer service portal can increase sales, improve loyalty, expedite sales and provide valuable customer usage information while reduce operating expenses. Portal integration is a great way to improve your CEM and over deliver on customer expectations. With OcularIP™, portal integration into your network is easy to set-up and intuitive for your customers to use.

A recent Forrester report states that over 80% of business customers prefer to access a web portal for their interaction with a business partner. Marketing, billing and trouble ticket portals provide information, but customers aren’t getting the item they value most – how the service performing now! That’s where OcularIP comes in.

Using OcularIP you can provide real-time customized and optimized circuit visibility. And with Performance Connect™ API, you can quickly and easily integrate a service level portal into your web strategy, OSS/BSS, EMS, including systems, platforms and applications.

OcularIP Makes It Easy

Your OcularIP service portal can be operational in minutes! OcularIP offers a full turnkey carrier grade program to offer the portal to your clients. OcularIP is in use with 137 carriers worldwide, over 110 in North America. Request a logon, download the OcularIP vCollector app (26mb) enter a key and let OcularIP learn your circuits, that’s it.

The only thing that outshines OcularIP’s functionality is the support we are committed to provide you. Contact us at infor@localbackhaul.com.

i 12/30/2019 David Strauss, Principal, Broadband Success Partners

[ii] By JEFF BAUMGARTNER, Senior Editor, Light Reading, 12/3/2019

[iii] Charter Launches Spectrum Total Connect Jan 13, 2020

[iv] Cable’s Fiber Outlook Survey SCTE Report Heavy Reading November 2019

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