Plan of Action

The all-digital cable plant continues to be a set-top box away. But that isn't stopping Charter Communications from rolling out total digital cable to its subscribers in Long Beach, Calif. The cable operator is six months into a field trial that is doing so well, it may be become systemwide by year's end.

What's the challenge facing MSOs in crafting an all-digital system? For openers, there's the cost.

Digital set-top boxes (or less expensive dongles) must be hooked up to every television in the system. Once every set can decode the digital signals, the operator can reclaim the analog bandwidth. That gives it the ability to add hundreds of digital channels, high-definition (HD) offerings, and VOD (video-on-demand).

That's the promise. The cost of the boxes is the pricey entrance fee. Today, the minimum per digital set-top box is about $100. Operators say that will have to drop to about $50 before they will embrace widespread deployment.

"You can't really turn off the analog portion of your system without getting all the customers a device to decode digital," says Pragash Pillai, Charter director of digital engineering. "And putting traditional set-top boxes in every home is a very expensive proposition."

That's why Charter's trial involves a new approach to digital conversion: "simultrans." This approach takes the 96 analog channels on the system, converts them to digital, and sends both out to subscribers. Televisions with the digital set-top boxes get a sharper image than analog sets.

"We can't force people to move to the digital tier," says Pillai, but it is important to make it available. Consumers generally assume digital to be better than analog. "The system in Long Beach has a better picture quality than satellite," says Pillai. "Once the system offers all-digital channels, the message we send out is that it's not only satellite that provides it."

Charter chose the Long Beach system because it has 860 MHz, enough bandwidth to accommodate the digital simultrans without having to reclaim some analog channels. When an operator converts an analog channel to digital, it replaces the one analog channel with three HD channels, 10 VOD channels, or eight to 12 standard-definition channels. If a plant has only 750 MHz (as most do), then seven to 12 analog channels would need to move off the analog service to open up the bandwidth.

Another reason Long Beach was chosen: It has only one ad zone. nCube's digital ad-insertion and VOD technology is used to store and distribute ads. The ads are digital files on a server and currently have to be decoded for placing in the analog stream.

What streamlines the process, explains Kristin van der Laan, nCube sales engineering manager, are cuetones in the incoming cable-network feeds that are read by both the analog and digital networks, making ad placement an automatic process.

"The ad splicer gets the digital broadcast and splices in the digital ad," says van der Laan. "The process is the same on the analog side."

Terri Richardson, nCube vice president of product and market management, says that adding the simultrans capability to the nCube system is a software, not a hardware, issue: "It's just another variation of our analog system."

Pillai says ad insertion has worked out well, and he's confident it will function in a system with multiple ad zones. Indeed, one of the advantages of all-digital is the opportunity for targeted advertising.

There are other advantages, too.

For one, there is reduced need for service technicians, since digital service can be turned on and shut off remotely. Plus, use of conditional access provides more signal security, reducing cable theft.

While Charter is converting its Long Beach customers (who are among the nation's highest in digital cable penetration, at 62%), the cable operator still faces the big question: When will it be able to reclaim the bandwidth?

With satellite operators serious about adding more HD channels, cable operators will be pressed to better utilize bandwidth. "I can't give you the exact date," says Pillai, "but it would be by 2006 or 2007."