Comcast said it has successfully trialed the DOCSIS-powered network of the future in Jacksonville, Fla.

The cable operator said it delivered symmetrical 1.25 gigabit-per-second speeds to a local-area home using Network Function Virtualization (NFV) and Distributed Access Architecture (DAA) with Remote PHY over DOCSIS-powered hybrid fiber-coaxial network.

Comcast is touting the successful trial as a “milestone” in the cable industry’s journey to what it markets as its “10G” future—one in which operators will deliver super-fast multi-gigabit downstream and upstream speeds with ultra-low latency, surpassing the potential of the wireless industry’s 5G push.

Comcast is engaged in the 10G initiative along with NCTA, CableLabs and SCTE, as well as operators from around the world.

“The great strength of our network technology is that we will have the ability to scale these next-generation speeds to tens of millions of homes in the future without digging up yards, or starting massive construction projects,” said Tony Werner, president of technology, product and Experience at Comcast Cable. “This technology provides a path to meeting the needs of the future and making multi-gigabit symmetrical speeds a reality for everyone, not just a select few.” 

Added Elad Nafshi, senior VP of next-generation access technologies at Comcast Cable: “We’ve been inspired by the work our global technical community has done to advance the technologies that made this performance possible and are proud to begin the process of delivering those benefits to customers.” 

The telecommunications industry has been riding the hype wave of virtualization over the past few years, and the cable industry has not been immune to this trend. To be sure, virtualization brings significant benefits in terms of improved operations, better resiliency, feature velocity, better customer experience and possibly lower cost, and indeed the cable industry is right to focus on adopting this enabling technology in their operating environment. We expect virtualization to gain meaningful traction in 2020 in the cable industry.

This said, virtualization is an enabling technology with far reaching implications for the operating environment of a cable operator beyond simply deploying a new system, and there is not one optimal approach to pursue; each operator should carefully consider the path to virtualization that is best suited to its current network, operating environment and parameters, service needs, and market dynamics.

Although the focus of virtualization conversations has typically focused on the CCAP—granted an essential component of a virtualization strategy—it is important to note that significant benefits can be derived from virtualizing the management and control planes, which can be achieved even while retaining the legacy I-CCAP. We expect cable operator strategies regarding virtualization to follow four paths in the next five years:

1. Retain the legacy I-CCAP as long as it continues to meet the operator’s needs. Despite technology innovation, legacy technologies tend to stay around a lot longer than one would expect, as long as they adequately meet the operator’s needs.

2. Virtualize the CMTS core while retaining the edge QAMs and move the PHY layer to a remote PHY shelf, which can be located in the headend or the hub. The advantage of this architecture is that it enables the MSO to derive some virtualization benefits while retaining RF from the headend and preserving the edge QAMs.

3. Remote PHY: The CMTS core is virtualized, and the PHY layer is moved to a Remote PHY device (RPD), which is housed in the access node. The traffic out of the headend is IP, carried over digital fiber. This approach allows the operator to leverage existing resources in the headend for MAC processing, keeping nodes simpler (no compute resource) with lower power requirements.

4. Remote MACPHY: The MAC and PHY layers are moved to the node, and a Remote MACPHY device (RMD) is housed in the node and performs the CMTS core capability in the node. This approach is simpler and has lower latency, but possibly a higher power requirement in the node and the need for compute resources in the node.

Although each of the above strategies has pros and cons and significant considerations based on the needs of each operator, it is important to note that all four solutions can be managed by a virtualized control plane, and more modern management tools such as RESTCONF and YANG can supplement traditional tools such as SNMP and CLI to deliver significantly improved management and monitoring. Furthermore, the architecture that the operator adopts today is not necessarily the one it will have over time. For example, Option 2 could be an interim solution for an operator that is looking to ultimately have a Remote PHY architecture but is not yet ready to move away from the edge QAMs and RF. Furthermore, some innovative vendors are developing solutions where the MAC functionality can be either part of the CMTS core or in the node.

It is imperative that an operator carefully considers its needs and makes a well-thought-out evolution plan, rather than be swept by the virtualization wave, and to work closely with a leading industry vendor that can offer the right solutions to meet its needs.

Liliane Offredo-Zreik (@offredo) is principal analyst atACG Research.

Harmonic said its virtualized cable access solution, CableOS, has been deployed by Canadian operator Westman Communications.

The operator has deployed CableOS in a distributed access architecture (DAA), using Harmonic’s Remote PHY, serving 35 communities in Manitoba with DOCSIS 3.1-powered internet service.

As the cable broadband access business shifts to virtualization, Harmonic has a head start. As of the end of the third quarter, Harmonic had deployed CableOS with 19 cable operators globally, serving 935,000 customer modems, up 20% from the end of Q2.

Related: Harmonic Drives 14% Q3 Revenue Growth as CableOs Biz Takes Off

“We want to deliver enhanced next-generation services to our customers over the best network in the most cost-effective way possible," said Graham Johnston, chief technology officer at Westman Communications, in a statement. "Harmonic's flexible software-based CMTS with simplified licensing and R-PHY support, along with their extensive DAA deployment expertise, enabled us to launch the CableOS solution in under two months, a considerable feat for such a significant technology transformation.”

Comcast, which has compared its new virtualized CCAP core technology to its X1 video system, will proceed with plans to license the software-based network tech to third-party cable companies just as it does with X1, according to Dell’Oro Group analyst Jeff Heynen.

“Comcast fully believes that other cable operators can benefit from their virtual CCAP core architecture, and they intend to license it just as they have done with their X1 video platform,” Heynen wrote in a blog post.

In July, Comcast announced that it had entered a multi-year agreement with Harmonic to license the San Jose, California-based access tech vendor’s CableOS product, which virtualizes Converged Cable Access Platform functions. It was reported earlier by Light Reading that Comcast was thinking about licensing out the vCCAP solution it was cooking up with Harmonic. And in October, Comcast told Light Reading that it had moved into deployment mode with not only access network virtualization, but also a shift toward Distributed Access Architecture. The cable operator said more than 100,000 of its customers are being served by vCCAP and DAA architectures.

“There are, of course, questions around just how that licensing model might work and how revenue might be distributed between Comcast and Harmonic, its vCCAP partner,” Heynen wrote. “But it’s clear that Comcast is leaving the door wide open to profiting from its software development work.”

During its third quarter earnings call, Comcast said that monthly data usage by its customers had more than doubled over the last three years.

“To deliver more bandwidth, MSOs traditionally have had to split their optical nodes to reduce service group sizes,” Heynen said. “Each node split, however, requires more passive and active equipment, including splitters, combiners, receivers, and transmitters. More importantly for opex is the need to increase the number of hardware-based CCAP platforms to support the additional bandwidth and service groups. The net result is a significant increase in space and power requirements in both headend and hub sites, as well as additional complexity in fiber cabling requirements.”

Comcast, Heynen noted, is taking a “lead role” in pushing virtualization, which allows it to add capacity without incurring exponential increases in space and power consumption.

“Even if Comcast moves away from its plan of delivering full-duplex (symmetric 10 Gbps) services in a node + zero environment, a virtualized CCAP core gives them the ability to scale at their own pace and at any location,” Heynen wrote. “Servers could still be located in existing headends or primary hub sites, or they could be deployed in centralized data centers. With workload balancing across their CCAP core servers, there are effectively no restrictions on where Comcast can grow its capacity.”

As for X1, Comcast executives have compared the micro-services-based nature of their vCCAP solution with the video operating system. Currently, Comcast licenses X1 technology to Cox Communications, which uses it as the foundation of its Contour video product. Canada’s Rogers Communications, Shaw Communications and Videotron also license X1 tech. 

Comcast, which has compared its new virtualized CCAP core technology to its X1 video system, will proceed with plans to license the software-based network tech to third-party cable companies just as it does with X1, according to Dell’Oro Group analyst Jeff Heynen.

“Comcast fully believes that other cable operators can benefit from their virtual CCAP core architecture, and they intend to license it just as they have done with their X1 video platform,” Heynen wrote in a blog post.

In July, Comcast announced that it had entered a multi-year agreement with Harmonic to license the San Jose, California-based access tech vendor’s CableOS product, which virtualizes Converged Cable Access Platform functions. It was reported earlier by Light Reading that Comcast was thinking about licensing out the vCCAP solution it was cooking up with Harmonic. And in October, Comcast told Light Reading that it had moved into deployment mode with not only access network virtualization, but also a shift toward Distributed Access Architecture. The cable operator said more than 100,000 of its customers are being served by vCCAP and DAA architectures.

“There are, of course, questions around just how that licensing model might work and how revenue might be distributed between Comcast and Harmonic, its vCCAP partner,” Heynen wrote. “But it’s clear that Comcast is leaving the door wide open to profiting from its software development work.”

During its third quarter earnings call, Comcast said that monthly data usage by its customers had more than doubled over the last three years.

“To deliver more bandwidth, MSOs traditionally have had to split their optical nodes to reduce service group sizes,” Heynen said. “Each node split, however, requires more passive and active equipment, including splitters, combiners, receivers, and transmitters. More importantly for opex is the need to increase the number of hardware-based CCAP platforms to support the additional bandwidth and service groups. The net result is a significant increase in space and power requirements in both headend and hub sites, as well as additional complexity in fiber cabling requirements.”

Comcast, Heynen noted, is taking a “lead role” in pushing virtualization, which allows it to add capacity without incurring exponential increases in space and power consumption.

“Even if Comcast moves away from its plan of delivering full-duplex (symmetric 10 Gbps) services in a node + zero environment, a virtualized CCAP core gives them the ability to scale at their own pace and at any location,” Heynen wrote. “Servers could still be located in existing headends or primary hub sites, or they could be deployed in centralized data centers. With workload balancing across their CCAP core servers, there are effectively no restrictions on where Comcast can grow its capacity.”

As for X1, Comcast executives have compared the micro-services-based nature of their vCCAP solution with the video operating system. Currently, Comcast licenses X1 technology to Cox Communications, which uses it as the foundation of its Contour video product. Canada’s Rogers Communications, Shaw Communications and Videotron also license X1 tech. 

Harmonic has announced another business win for its CableOs product, with the virtualized cable access solution deployed with DSA, a nonprofit antenna association in Denmark.

The software product will be managed by Harmonic’s local CableOS partner, Infowise.

Earlier this week, Harmonic attributed a 14% spike in Q3 sales to CableOS, which it said is now deployed with 19 cable operators globally.

Related: Harmonic Drives 14% Q3 Revenue Growth as CableOs Biz Takes Off

"Harmonic's CableOS solution will ensure our smooth transition to DOCSIS 3.1, allowing us to efficiently and cost-effectively increase broadband capacity through a flexible architecture to support the deployment of R-PHY in the future,” said Henrik Lindholm, chairman of DSA, in a statement.

"As operators around the world move to DOCSIS 3.1 and roll out Gigabit internet offerings, it's becoming obvious that choosing a software-based CMTS offers distinct advantages over hardware, including operational efficiency, accelerated introduction of new features and scalability," said Gil Katz, senior VP of cable access business operations at Harmonic. "Our CableOS offering features a unique virtualized architecture that empowers cable providers like DSA to deliver fast broadband speeds and significantly reduce their operating expenses."

Harmonic said its long-gestating virtualized cable access business has finally arrived.

And the evidence was certainly there in the fourth quarter, with revenue spiking 14% year over year to $115.7 million. Specifically, the San Jose, California-based vendor’s cable access business generated $55.7 million in the quarter, $42.9 of which, the company said, was gross profit, as Harmonic shifts cable access away from large proprietary hardware devices to software virtualization.

“Our virtualized CableOS solution was the primary driver of this growth, demonstrating the operating leverage achievable as we scale our software based solutions,” Harmonic CEO Patrick Harshman told investment analysts Monday evening.

Related: Harmonic Adds $55 Million CableOS Deal with Unnamed Euro Operator

Comcast, with which Harmonic has a warrants agreement, controls the foundation of CableOS sales at this point. The cable operator signed a four-year, $175 million agreement to use CableOS as it converts to a virtualized network scheme involving Distributed Access Architecture.

“When we say we've signed $175 million software license agreement, you should understand that such a deal represents approximately the same gross profit that's $400 million of remote PHY sales,” Harshman said.

Beyond the solid margins, Harshman said the Comcast deal will generate more than just the base contract agreement.

Related: Harmonic Announces FTTH Capabilities for CableOS

“So to be clear, $175 million is the minimum cash we’ll see through this deal,” he said. “Additional sales of associated remote PHY equipment or any other technology or services to Comcast will be incremental to our top and bottom lines. And finally, this unique software license covers Comcast direct service footprint.

Beyond Comcast, the CEO said “we’re making good progress expanding our customer base.” As of the end of the third quarter, Harmonic had deployed CableOS with 19 cable operators globally, serving 935,000 customer modems, up 20% from the end of Q2.

And not included in the Q3 numbers are deployments with two international Tier 1 operators.

“With both customers, the progress is good and our confidence is high,” Harshman said. “With one of these customers, we expect deployment and revenue to begin to ramp in the fourth quarter. With the other, deployments and revenue is expected to begin in the first half of next year.”

According to Harmonic, CableOS renders operators 70% power savings, a 20-1 physical space reduction and a drop in the meantime to detect network problems from 30 minutes to 15 seconds.

All of this cited, the company also noted a recent Dell’Oro Group forecast predicted 50% compound growth to around $1.2 billion for the virtualized cable access market by 2023.

“With this market growth chart as a backdrop, let me be clear. This is a market category that Harmonic largely invented and that we're now uniquely positioned to lead,” Harshman said. 

Harmonic’s virtualized cable access sales are starting to come to fruition, with the San Jose, Calif.-based technology company announcing a five-year, $55 million contract with a unnamed European operator for its CableOS software product.

The announcement, made during Harmonic’s second-quarter earnings call Monday, comes just a few weeks after Comcast finally game through with an expected big CableOS order—a five-year contract valued at $175 million, with $50 million hitting the software makers books this year.

In total, CableOS is now commercially deployed by 16 cable operators, CEO Patrick Harshman told investors, “with 780,000 connected cable modems at the end of the second quarter, which is up 16% sequentially from the number we shared with you at the end of the first quarter.”

Related: Harmonic: Volume Deployment of CableOS is on the Way

CommScope’s newly acquired Arris unit leads the cable access network technology business but Harmonic is the leading insurgent, selling a software the virtualizes Converged Cable Access Platform functions traditionally performed by expensive proprietary hardware, such as cable modem termination system (CMTS).

“Today, we've made 35 unique patent filings,” Harshman declared. "Big picture is increasingly clear that the cable access market is beginning to make a major pivot towards these virtualized CMTS distributed access architectures. It's also clear that this is not just a U.S. phenomenon. We're seeing the trend beginning to unfold across all regions, driven by those operators who are most aggressive about strengthening their competitive position.

“Our pioneering innovations and strategic customer engagements have put us in a unique position to take advantage of this global wave,” Harshman added. “And let me be clear, Harmonic is determined to take advantage of this opportunity not only by leading technologically, but to be the global market share leader. We're doing this by leveraging our position and as the first cloud native CMTS supplier, our associated with unique solution for new distributed access architectures, our strong intellectual property position and foundational wins within our several of the world's largest and most influential cable operators.”

While Harmonic planted its virtualized flag over the cable access business, it reported GAAP revenue of $84.9 million for the second quarter, down 14.4% year over year.

Continued infiltration of CableOS will certainly help matters going forward. The company’s software (SaaS) revenue came in at $30.4 million for Q2, representing $35.9% of total revenue. SaaS was just 30.9% of total revenue a year ago. 

Speaking to Investors during Harmonic’s first-quarter earnings call, CEO Patrick Harshman declared his company’s intention is to be “No. 1” in the cable access-network technology business, displacing incumbents Arris/CommScope and Cisco Systems.

But like an NBA team tied in the closing minutes of a playoff game seven, Harmonic faces some nervous moments as it seeks its title. The tech vendor is waiting for Tier 1 clients to get done with trials of its CableOS and actually start deploying the virtualized cable access product.

As leading operators such as Comcast move towards Distributed Access Architecture (DAA) and virtualization of key network components, San Jose, California-based Harmonic stands to seize sizable market share with its DAA-focused fiber nodes and CableOS virtualized cable access product, which turns giant pieces of hardware like the cable modem termination system into software.

“Harmonic has quite a bit of momentum; they’re really pushing the envelope in terms of distributed access technology,” analyst Jeff Heynen, research director of broadband access and home networking for the Dell’Oro Group, said.

CableOS Tests Wrap Up

Harmonic has said four of the top eight cable operators in North America and Europe are engaged in commercial trials of CableOS, one of which is widely known to be Comcast. The company also said it has 32 commercial deployments and field trials of the product currently underway, and that 670,000 cable modems are now tied to CableOS, up 24% from the fourth quarter.

In March, Harmonic announced a pact with the National Cable Television Cooperative to jointly offer the virtualized cable access solution to the co-op’s more than 750 members.

Harshman said one large foreign operator signed a $50 million contract for CableOS.

Unfortunately, Harmonic’s bottom line has yet to reflect this momentum. First-quarter revenue was off 11.1% year-over-year to $80.1 million. Notably, revenue from cable-access products was down more than 30% to $12.9 million.

Harmonic has offered shareholder guidance that cable access revenue will range from $100 million to $130 million for the year and needs to see business pick up significantly in the ensuing three quarters to come through.

Harmonic isn’t alone. Competitor Casa Systems, which reported a 56% Q1 revenue slide last week, also says it’s in a “holding pattern,” waiting for MSO customers to get off the dime with emerging access tech.“We’re seeing an industrywide slowdown as cable operators implement a shift to virtual CCAP and DAA,” Casa Systems CEO Jerry Guo told investors, describing a “quarter we’re not at all happy with.”

For his part, Harshman spent much of the April 29 earnings call assuring investment analysts that major deployments of CableOS are coming, starting in the second quarter.

“There were a couple of major architectural change decisions made by our lead customers,” the CEO said, explaining the deployment delays. “And going into the beginning of the year, frankly, there was a little bit of uncertainty about the exact time frame that those could be implemented and how we would kind of get back on track. But the good news is, all that work is just about done, and we feel as though we’re largely currently getting back on track.”

Harshman assured investors his confidence stems from hard evidence. “We’re not just talking about verbal dialogues here, we’re talking about very detailed spreadsheets,” he said. “And frankly, plans that we’re investing in.”

One analyst asked if the deployment delays could be caused by an unforeseen cable access competitor making a late-game play against Harmonic.

“We don’t know what we don’t know,” Harshman conceded. “We have not heard of anything else being demoed in the lab, successfully and competitively. It’s prudent not to be overconfident. But it’s hard to imagine, frankly.”

A Big Market to Fight Over

Harmonic and Nokia, which also serves the DAA and virtualization market, are competing for a big prize. Heynen said the cable access market was worth $1.5 billion in 2018 and is growing at a single-digit but still nice pace.

As the analyst explained to Multichannel News, the benefits of virtualization and DAA are myriad. “You can save on rack space, you save on power consumption and you save on hardware costs,” Heynen said. “Comcast is going to be a big driver of DAA. The question is, how fast does Comcast move?”

That’s a question that Harmonic shareholders would certainly like to have answered themselves.

The DAA revolution is coming, Harmonic insists, it’s just being delayed a quarter or two due to some integration issues occurring with the company’s largest clients.

That was the message put forth during Harmonic’s first-quarter earnings call Monday. The technology vendor’s virtualized cable access technology, which it calls CableOS, is one of the most closely watched product lines in the cable industry right now, threatening to upend the hegemony enjoyed by CommScope-owned Arris, Cisco and Casa Systems.

Harmonic said that 670,000 cable customers are getting their network service through CableOS right now in markets mostly in the U.S. and Europe, a 24% uptick over the first quarter of 2018.

However, the company’s Q1 revenue from cable access products was only $12.9 million, down considerably from the $18.5 million generated in the first quarter of last year.

Harmonic’s stock cratered more than 5% following Monday’s call, with investment analysts concerned about the company’s ability to live up to full-year guidance of $100 million - $130 million in cable access revenue.

For his part, Harmonic CEO Patrick Harshman said he expects CableOS revenue to start ramping up quickly starting in the second quarter. Harmonic has loosely identified four Tier 1 clients in North America and Europe as being in various phases of testing CableOS, with one of those customers widely suspected to be Comcast.

“There was a couple of major architectural change decisions made by our lead customers,” Harshman said. “And going into the beginning of the year, frankly, there was a little bit of uncertainty about the exact timeframe that those could be implemented and how we would kind of get back on track. But the good news is all that work is just about done. And we feel as though we're largely currently getting back on track.”

One investment analysts asked, might there be unforeseen competitive forces actually causing these delays? 

“We don't know what we don't know,” Harshman conceded. “We have not heard of anything else being demoed in the lab, successfully and competitively. It’s prudent not to be over-confident. But it’s hard to imagine, frankly.”

Numerous operators, including Comcast, are aggressively moving to Distributed Access Architecture (DAA), pushing fiber deeper into the network and moving network functions out of the plant and closer to customers. This process walks hand in hand with virtualization of network functions like Cable Modem Termination System (CMTS). Meanwhile, a number of Tier 2 & 3 clients aren’t necessarily migrating their networks to DAA, Harmonic said, but are rather simply subbing in virtualized components as they swap out DOCSIS 3.0 network infrastructure for the newer DOCSIS 3.1 standard. 

Harmonic has reached an agreement with the NCTC to jointly offer the tech vendor’s CableOS virtualized cable access solution to the cooperative's more than 750 member cable operators.

Harmonic said deployments are already underway with National Cable TV Cooperative members including 1Tennessee, Buckeye Broadband, Comporium, Hilliary Communications and TVS Cable.

CableOS, a software-based iteration of Converged Cable Access Platform (CCAP), is in nearly 30 commercial and field trials currently, Harmonic said last month during its fourth quarter earnings call. Participating companies include four out of the top eight North American and European cable operators.

Related: Harmonic Posts 12% Revenue Growth in Q4 on CableOS Gains

"Harmonic's cost-effective approach to virtualizing the cable access architecture will small- and mid-sized members to have a viable choice for increasing their broadband capacity and deploying a competitive, high-speed Internet offering, while ensuring they provide reliable streaming video services,” said Rich Fickle, president and CEO of NCTC, in a statement.

“By allowing hundreds of small- and medium-sized cable operators the opportunity to connect with world-class technology companies, the NCTC enables its members to be stronger and more successful than they could be acting alone," added Nimrod Ben-Natan, senior VP and general manager, cable access business, at Harmonic. "Allowing operators to achieve new levels of scalability, reliability and efficiency, our CableOS solution is gaining significant momentum, and this new relationship with NCTC is proof of its winning business model."

Casa Systems cut its revenue guidance by $50 million for the rest of the year this week, explaining that its cable operator clients are putting off longterm investments on network expansion as they mull their big moves to virtualized architectures.

Speaking to investors during Casa’s second quarter earnings report, company president and CEO Jerry Guo said customers are making only short-term investments on network capacity expansion, eschewing high-capacity purchases of Converged Cable Access Platform hardware as they mull their strategy on next-generation Distribute Access Architecture (DAA).

Related: Casa Systems Shrinks IPO Size to 6M Shares at $13 Each

“Over the last few weeks, it has become clear to us that we are witnessing a pattern shift in procurement in the cable market,” Guo told investors, according to a transcript provided by Seeking Alpha. “While our customers weigh the timing for their large-scale rollout of the next network architecture, they are choosing to only procure capacity in a short-term basis. And they're not making very long-term upgrades of the chassis-based products in some cases.

“We do see DAA delayed industry wide in terms of large scale deployment,” Guo added. “And given that a lot of operators are contemplating DAA, they are slowing down their spending in their current capacity expansion.”

Guo said believes larger scale DAA deployment will begin in 2019.

Of course, none of this is helping Casa’s bottom line in the short term. The company’s stock is down around 23% since its Tuesday earnings report, during which it cut full-year revenue guidance to as low as $330 million.

Casa reported second quarter revenue of $68.7 million, up 3.1% from the year-ago quarter, but down 23% from the first quarter of this year.

Denver – Whether it involves technical specifications or plans involving trials or deployments, the cable industry continues to push ahead with next-generation, distributed access network architectures that will help to pave the way to the virtualization.

But there’s still some uncertainty in terms of the speed at which those transitions will get under way as MSOs look to distributed access architectures (DAA) to push fiber deeper into their networks and enable higher fidelity digital optics, while also reducing the space and power requirements of their headend and hub sites.

While 34% of operators surveyed last year expected to have preparations for distributed access architectures (DAA) underway in 2018, the expectation now is that bigger deployments will likely get pushed into 2019, Jeff Heynen, consulting director at SNL Kagan, said here Wednesday at Light Reading’s Cable Next-Gen Technologies & Strategies event.

Still, “it’s very clear…that distributed access is going to be a major factor in terms of the revenue tie” for cable access network technology,” he said.

RELATED: Forecast Gets a Fix on Next-Gen Cable Network Tech Spending

CableLabs, meanwhile, has been moving forward with specs for DAA and Distributed CCAP Architectures (DCA) that aim to ensure interoperability between suppliers. Taken together, CableLabs’s DAA-facing efforts include several areas such as Remote PHY, Remote MACPHY, and Full Duplex DOCSIS, and its work with coherent optics.

Jon Schnoor, lead engineer, wired technologies at CableLabs, said the specs for Remote PHY are nearing an end, with 11 interop events already completed, and have already moved into the qualification stage. Spec writing for Remote MACPHY, which introduced a new component called the MAC Manager, is underway.

RELATED: CableLabs Moves Ahead with Remote MAC/PHY

In addition to Remote PHY devices (RPD), CableLabs’s work also extends to include a new device called a Remote MAC Device (RMD) that moves the CCAP functionality into the node.

As part of some phase II work, CableLabs and its constituents are also working on something called the Remote MAC Core, which can be put in the node, headend or hub. That, Schnoor explained, will give operators the flexibility to put that functionality wherever they need it on depending on their power and space limitations.

Phase III, with a 2019 timeframe, will aim to virtualize the DCA portion of DAA, and utilize a software-powered control plane.

These approaches should enable operators to distribute more functions toward the edges of the network over time and free up space in headends and hubs, or possibly eliminate the need for them altogether.

MSOs, meanwhile, are also moving ahead with DAA and virtualization plans as that work at CableLabs continues.

WideOpenWest, for example, has teamed with Nokia on a Remote MACPHY initiative that is initially focused in Cleveland and Chicago.

Cash Hagan, WOW’s chief operating officer, said new nodes are going in today, with an initial focus on saturated parts of the network. Later this year, WOW will expand that work into additional markets, and will also start to install a distributed access node anytime one needs to be cracked open, he added.

Hagan said a key driver is to build more capacity into the network while achieving other capex and opex benefits that it gets as it cuts down on space and power needs in headends and hubs. “The only way to get there is by distributing the network,” Hagan said.

Comcast is also pursuing a DAA initiative with a focus on Remote PHY, which it says can add value in a number of different architectural models currently in place in its network.

In addition to the power and space benefits, it will also simplify the network and enable Comcast to get a real-time view into the performance of its network.

With service reliability being a paramount factor, having that instant visibility into the network “is critical to everything we want to do going forward,” Elad Nafshi, Comcast’s senior vice president, next generation access network, said here during a keynote later in the day.

Nafshi, who sees the access network becoming an epicenter of cable innovation, also confirmed that Comcast’s DAA activities will focus on Remote PHY.

There’s been a debate roiling in cable engineering circles about the pros and cons of Remote PHY and Remote MAC/PHY, options being weighed as operators mull new Distributed Access Architectures (DAA) that aim to boost capacity while also reducing their power and space requirements in the headend or hub.

Nokia holds that the debate has been rendered moot following the debut of a new virtualized DAA platform that features a “universal” cable access node that can be configured to run as a Remote PHY (RPD) device or Remote MAC/PHY (RMD) device.

In addition to reducing space and power requirements, cable operators are also looking for DAA to improve the fidelity of the outside plant and to help them drive more capacity for DOCSIS 3.1 and set them up for Full Duplex DOCSIS, an annex for D3.1 that will support multi-gigabit symmetrical speeds and require a node+0/deep fiber network in which there are no amplifiers between the node and the home.

The new node, Nokia claims, can turn the MAC portion on or off, because it’s been reduced to an independent software virtual network function that can be controlled remotely by the cable operator.  

“We believe we’ve ended the debate,” Jeff White, head of cable strategy at Nokia’s fixed networks group, proclaimed, holding that the dividing line between the two options is now “quite small” and that this is the sort of breakthrough that makes this part of the architecture decision a secondary one for MSOs.

He added: “It’s a piece of software” that can run in a server, in a traditional CCAP [converged cable access platform] chassis or in the node itself.

Nokia, whose work in this area stems from its 2016 acquisition of Gainspeed, plans to show off its new platform at next week’s SCTE•ISBE Cable-Tec Expo in Denver.

RELATED: Nokia Nabs Gainspeed

The product set and features for Nokia’s virtual DAA platform include a virtualized CMTS (that includes the DOCSIS MAC), the aforementioned universal node, and an access controller that can support both Remote PHY and Remote MAC/PHY.

Nokia’s move will also put some completive heat in other vendors that have launched or are developing DAA products, a group that includes Arris, Cisco Systems, Casa Systems, Harmonic and Huawei.

The toggling capability represents a new approach for Nokia, as Gainspeed had previously been pushing a technology agenda that centered on Remote MAC/PHY. White said the “light bulb went off” about this more flexible approach as operators started to think more critically about their network functions virtualization (NFV) and software-defined networking (SDN) strategies.

White said Nokia has found that operators are looking at both options, as one or the other might work better under circumstances, scenarios and conditions.

If space in the headend is major issue, he said, a Remote MAC/PHY approach might make more sense, and allow operators to reduce or eliminate hubs. Remote MAC/PHY might also be better suited for a strategy in which an MSO is looking to centralize and virtualize the bulk of the command and control mechanisms from a centralized system or data center.

Remote PHY, he added, might be a better option if power is limited in the cable operator’s outside plant, as a Remote MAC/PHY node is likely to require between 5% to 10% more power than a Remote PHY node, which requires less processing horsepower.

White said operators are looking at a “cap and grow” approach to DAA as well as some specific use cases, such as a “hotspot” on the network or in contested MDU environments. Still others might go at it hub-by-hub as they look to consolidate those.

Nokia hasn’t announced any deployments, but Comcast, Liberty Global and WideOpenWest were among the MSOs that praised Nokia’s acquisition of Gainspeed last year. At the time, WOW said it was “well down the path" with testing and "preparing for deployment" of Gainspeed's vCCAP.

“Nokia is revolutionizing the cable industry with an innovative new cable solution that gives operators the flexibility to implement a distributed access architecture without being handcuffed to a specific approach,” Cash Hagen, WOW’s chief operations officer, said the release issued Monday. “Virtualizing the DAA not only simplifies the network and drives cost savings, it also allows us to accelerate the delivery of new services that ultimately provide a better customer experience.”

Cisco Systems plans to cut up to 14,000 jobs, or 20% of its global workforce, in the “next few weeks,” CRN reported Tuesday, citing unnamed sources close to the company.

Cisco’s been asked to comment on the report, but CRN said the company has already offered early retirement packages to employees.

Update: Cisco declined to comment.

CRN said the cuts will range from 9,000 to 14,000 employees, and will come as Cisco shifts its focus and skillset to support the move toward more virtualized, software-defined networks and away from purpose-built hardware.

Cisco is scheduled to post fiscal Q4 results Wednesday (August 17). The company, which sold its CPE business to Technicolor in late 2015, posted Q3 revenues of $12 billion, up 3% year-on-year, and said it expects Q4 revenue growth of up to 3%.

Cisco, helmed by CEO Chuck Robbins since July 2015, announced it would cut 6,000 jobs, or 8% of its global workforce, in August 2014, a year after the company laid off about 4,000 workers.

Earlier this year, Cisco expanded its service provider organization amid a broader reorganization.

In today’s environment of cord-cutters and streaming services, cable MSOs are under pressure to offer competitively priced services while providing an enhanced quality of experience.

The pressure is not unfounded – there is a lot at stake for cable companies facing what can be described as an "over-the-top (OTT) double-edged sword.” Internet service has never been more important to cable companies as they watch linear video give way to on demand programming, but meeting customer demand for fast and reliable internet service is ironically what led to the decline of their video revenue stream as it paved the way for OTT service providers such as Netflix, Hulu and Amazon Prime. 

With OTT not going away, cable companies must look to provide a greater experience in order to stay ahead of what will certainly be the future of television to remain viable. But what steps can MSOs take to provide a greater level of service? 

For one, adoption of virtualization technologies and trends like Head Ends Re-Architected as a Data Center (HERD), which is the adaptation of the telco Central Office Re-Architected as a Data Center (CORD) initiative for the MSO market, will be important. Another differentiator is the continued drive to push the network closer to subscribers with what is described as a Fiber Deep evolution—pushing the fiber closer and closer to the end user to provide better service. 

While cable companies may look different by 2020, whether they begin decoupling programming packages or even aggregating OTT packages as Comcast is planning to do with Netflix, they need to focus on their architecture to support a better experience now and allow them to offer differentiating features in the future. 

Importance of Highly Responsive Internet Services

As user demands around Internet speed and availability have increased, the need to store content locally to provide high quality, responsive access to the content that customers want is required in order to address the competitive landscape.

The Internet relies on locally stored or “cached” content to serve up a great user experience. Cable has an advantage here, since they are the network down the block—not miles away in a large data center. That distance will impact responsiveness and, especially in peak hours, quality of service. The cable headend has for many years served up on demand content, but will need to make one more transformation to bring content even closer to consumers.

The first generation of streaming video might take customers to a data center out-of-state providing poor performance while tarnishing a cable company’s internet services reputation. By leveraging the HERD approach and utilizing data center technologies like virtualization, caching and software defined networking in the headend, those organizations can keep customers satisfied, lower the abandonment rate and make sure the advertisers get compensated.

Competition is already robust and to stay ahead, the customer experience is best served from the headend down the road rather than from a random data center in the cloud.

Content Delivery, Mobile Edge Computing and the Redefined Network Edge

Netflix is a great example of a company that innovated its networks out of necessity. While a fledgling streaming media company a few years ago, the company realized that the legacy Internet was not enough for the new mobile generation. Netflix used the cloud and the internet but found that video would not work unless it was delivered by a local server. When streaming from a far-away data center, the user often became dissatisfied and cancelled their service. Content Delivery Networks solved the problem to a degree, but still lacked the ability to scale with demand and would still limp along slowly.

To overcome this challenge, Netflix reimagined content distribution and placed servers close to the Internet’s edge, providing near real time responsiveness. Now picture making the performance even better by having the network respond with more bandwidth by effectively optimizing caching technology.

By moving and virtualizing these servers and sharing precious network resources, cable MSOs can effectively make all OTT content closer to the end user, improving latency and providing a platform for video aggregation that can support live and real time events such as the Super Bowl or a heavyweight boxing match.

And by driving the fiber deeper, they can further improve performance: deep fiber pushes the optical-to-electrical conversion of signals closer to subscribers, which increases potential bandwidth to homes (allowing for support of newer and more numerous services), as well as cutting down on operational costs related to power and maintenance.

Marrying Transport and Caching

Let’s face it, video follows a hockey stick curve, where there may have been slow growth initially but we have seen that growth rate quickly increase to a much faster rate. With the ability today to interact with content and binge watching becoming the new normal, cable MSOs must be able to quickly react and provide a differentiated user experience for their customers. To achieve this, cable MSOs will need to throw a combination of compression, caching, and CDN technologies at the problem.

But what if there was a new option, with the ability to get a file from just a few miles away—near instantly—and the user wouldn’t realize the difference. The future of the cloud is a combination of network, compute and storage architectures to create the best experience. By offering the right mix of bandwidth and orchestration, cable MSOs will be able to take their businesses to the next level.

This will keep the OTT consumers happy while cable MSOs avoid becoming the weak link in the video delivery value chain.

-Elias Cagiannos is MSO Practice Leader at Ciena

Cisco Systems is shoring up its cloud platform by putting up $260 million for CliQr, a privately held company that has developed a cloud orchestration platform for virtualized environments.

Cisco said it has already integrated CliQr with a number of its data center switching and cloud platforms, including Cisco’s Application Centric Infrastructure and its Unified Computing System.

Cisco believes  the acquisition of the San Jose-based company and its CloudCenter platform will help its customers simplify and accelerate their private, public and hybrid cloud deployments.

CliQr’s platform, Cisco added, will help its customers create a single application profile across data centers and public or private clouds.

Cisco said the CliQr team will join its Insieme Business Unit, reporting to Prem Jain, the unit’s senior vice president and general manager. Cisco expects to close the deal in its fiscal third quarter.

"Customers today have to manage a massive number of complex and different applications across many clouds," said Rob Salvagno, vice president, Cisco Corporate Development, in a statement. "With CliQr, Cisco will be able to help our customers realize the promise of the cloud and easily manage the lifecycle of their applications on any hybrid cloud environment."