Cable operators and other broadband service providers have important strategic assets that they can further monetize — generating new sources of revenue.
Let’s start with facilities. With headends and central offices distributed throughout their service areas, cable operators have actual brick-and-mortar real estate that could provide OTT edge service providers with locations to house their servers (as Netflix and others have already done).
Pole attachments, fiber strands and right-of-way assets give providers almost ubiquitous access across their footprint. While the availability to sublet this access varies, the coverage is a most attractive resource to any new provider of access services, be it wired or wireless.
Retail stores are another type of facility that many cable operators have to offer. These stores could be used to promote and sell the products of OTT edge services providers.
Cable operators have a highly skilled, experienced workforce. These “human resources” have specialized capabilities that could be of use to others, if positioned and priced correctly. That can produce a new revenue stream for operators.
The field technicians employed by MSOs have the tools necessary to travel across the landscape and attend to both the customers and the remote facilities that an OTT edge service or new access provider may need to visit.
Last, and perhaps most importantly, cable customers are a valuable asset. The subscriber lists contain the names and addresses of people already spending their money on access and edge services; these people are likely to be receptive to new offers.
In recent years, MSOs have been collecting and analyzing data about their customers and their purchasing and viewing habits. This anonymized and demographic information can be valuable, not only to edge service providers but to a range of other businesses.
By leveraging such assets, cable operators can pursue a variety of new business opportunities. We run through these new opportunities below.
Access provider platform
To prepare for the introduction of 5G, new wireless access providers (such as Starry) and existing mobile network providers like Verizon will be placing new base station radios or small cells all over the landscape to reach their customers with short-range, line-of-sight radio equipment. Incumbent service providers have several opportunities in this market:
Connection of the radios to the access provider network can be provided using the cable operator’s fiber or HFC network.
The cable operator’s right-of-way, including existing outside plant facilities, could be used to locate base stations or small cell equipment for the wireless access provider. Depending upon rules from the provider of pole attachments to the cable operator, space could be sublet to the wireless or mobile access provider or wireless equipment could be adopted by the operator. The location of the equipment is one possible revenue stream, maintenance of that equipment is another. With the MSOs’ fleet of vehicles and trained RF-experienced field staff, there is a great opportunity for agreements that could benefit both companies.
In-home/in-office service force
The army of technicians that MSOs have at their disposal is already trained and equipped to provide on-premises customer care. Extending that capability to a third party could be fairly simple.
Installing and maintaining CPE
An OTT TV provider could have technicians install or service its set-top boxes. A business telephone service provider could have someone do station installation at the customer’s office. A firewall provider could have help installing on-premises appliances. Even a provider of SD-WAN-based specialized WAN services could have a trained workforce to help place access devices at customer sites, perhaps tied in to Internet access services from the cable operator.
A huge opportunity exists in the healthcare arena. Patients can already teleconference with their doctors using a standard laptop computer, tablet or phone. But new accessories in electronic monitoring of vital signs can take this to another level. While this equipment will be designed for self-installation and run over the top of any broadband network, many customers will require assistance, which is what a cable operator’s field force can deliver.
Customer database/sales integration
A cable operator’s existing customers represent a group already consuming access and edge services, at a minimum from the provider itself. These customers can be targeted with offers from edge services partners.
Data center/CDN provider
With headends or central offices throughout a community, an MSO or telco has the raw facilities to enter the business of supplying server resources to edge service providers.
The upcoming CORD/HERD (Central Office and Headend Reconfigured as a Data Center) standards will pave the way for cable operators to operate multi-tenant edge services servers efficiently. With the operator and OTT edge provider working together, they can create a better customer experience for both.
Declining revenues due to OTT and access competition must be replaced for the cable operator’s business to continue to grow. By working with the competition, operators can transform from victims to victors.
Jack Burton, Broadband Success Partners