Opportunity or Trouble with C's - CableB2B, CableHome, Canoe?
Cable's pursuit of a homogeneous nationwide interactive advertising
By: Bruce Bahlmann - Contributing Author (your
is important to us!)
February 4, 2008
has engaged in a number of efforts to standardize various aspects of its
infrastructure, services, and business relationships. One of its latest
efforts is known as Cable Access Network Operations Extensions (Canoe).
While many details of Canoe remain confidential, Comcast’s Brian Roberts has
pitched this to Wall Street comparing cable’s vision for interactive
advertising to Google’s Internet search business, in its ability to match
advertising messages with a relevant audience across an aggregated set of
first heard this, my immediate reaction was to question whether Canoe was
any different than CableB2B or CableHome. So, rather than retrace already
well traveled waters of describing what Canoe is, the goal of this article
is to offer some background on these other CableLabs projects and how
similar they are to Canoe. The significance of this comparison lies in the
fact that both CableB2B and CableHome represent CableLabs projects that
Paddling up Cable’s Past
CableB2B specifications sought to cover portions of the business interface
between cable operators and providers of services deliverable over the cable
plant, through cable modems, advanced set-top boxes, and other technologies.
CableB2B was also a convenient project for the cable industry to undertake
during a time when federal regulations were tittering on whether to require
all cable operators to open their networks to Internet Service Providers (ISP)s
whose dialup customers were rapidly migrating to the now widely available
cable modem service. Eventually, as federal regulations eased the CableB2B
program quietly went away. In the aftermath, vendors who put time and money
into supporting the program began to ask questions. Some of the answers
suggested that various cable operators involved in the program could not all
agree on the business aspects required to make CableB2B successful and that
various technical aspects of the project were not all mutually agreeable
either. These struggles suggest that when it comes to having multiple cable
operators agree to similar business models or even similar interface
functionality (as suggested in Canoe) that the mutual agreement will be hard
to come by - they are all separate companies after all.
1.0 CableHome Vision
Shortly after the swirl of CableB2B blended into the stream, CableHome
surfaced to mix things up yet again. CableHome was touted as cable’s
foundation for future home services (a market estimated at its inception to
reach $5 billion by the year 2005) which built upon entry level features of
residential gateways to offer zero customer configuration, cable operator
management, and was designed to support advanced QoS sensitive PacketCable
services. While the cable industry did what it could to capture the interest
in some vendors to build, certify, and deploy CableHome devices, noticeably
absent from the program’s inception was the full support and involvement of
the Consumer Electronics (CE) industry. CE already had other plans in the
works (namely UPnP and
DLNA) and as a result was less than enthusiastic to
follow through with building custom devices that would only work within
cable systems. In the end, it wasn’t the concept of CableHome (see Figure
1.0) that failed but rather the cable industry’s inability to rally CE to
build devices that would only service such unique features within a cable
CableHome also brought into question the possibility that beyond DOCSIS and
the early versions of PacketCable the days of cable rolling its own
successful standards are coming to an abrupt end. In fact, many of
CableHome’s zero customer configuration features were already part of a much
more comprehensive standard (TR-069) championed by the telecommunications
industry. Similar developments in PacketCable and even DOCSIS are taking
place as CableLabs increasingly taps into international telecommunications
standards such as
3GPP, etc. over rolling its own. So, in light of CableLabs’
increasing alignment with international standards, Canoe could face a strong
current in rolling its own standard for interactive advertising as national
advertising agencies will likely demand universal standards across
Television market share has also drastically changed in the past 10 years
for cable. During this time Satellite companies (DirecTV and Dish) have
surpassed individual cable companies in terms of numbers of digital
television subscribers (see Table 1.0) and Verzion has climbed to a
respectable level in just a couple years. Today only 8 operators in the US
serve 1 million or more digital television subscribers. Cable operators
provide digital television services to 50% of the subscribers in the US
followed by Satellite operators with 48% and lastly by the lone telephone
operator (Verizon) with 1.6%.
Digital TV Subs
Table 1.0 US digital
television providers with more than 1 million subscribers in 2007 (Source
cable’s command of 50% of digital television subscribers in the US is more
than Google’s 43% of online search, the big difference is that Google
doesn’t need to orchestrate a business and interface agreement between 5
different cable operators as well as engineer such a system in preparation
to present something compelling to advertisers in the case of Canoe.
Instead, Google is truly a one stop shop for online advertising with
unprecedented nationwide (as well as global) reach. Table 1.0 reflects
only cable’s digital subscribers as cable’s basic subscribers who use analog
cable services or non-digital set top boxes wouldn’t be eligible to receive
Forward stroke or backwards stroke?
Cable’s foray into standardizing something other than cable infrastructure
is not a new concept (see Table 2.0) and while there are examples of
successes (such as Go2Broadband), there seems to be a narrow margin of error
between success and failure. Go2Broadband was a success because of its
simplicity and mutual benefit it provided for all active members.
CableB2B program is
an initiative to create specifications supporting the automation of
regular, day-to-day business communication between cable system
operators and Internet content providers, including ASPs and ISPs.
Difficulty to agree
home networking interface specifications necessary to extend
high-quality, cable-based services to network devices within the
home while maintaining customer privacy.
Foothold within home
Lack of CE
advertising relationships and interface between cable system
operators and advertisers.
National and local
To Be Determined
Table 2.0 Cable’s special
national advertising perspective, the consensus is that there is already
plenty of opportunity in cable to advertise on the national level. However,
at the regional or local level such opportunities are much more expensive
and much less efficient. Cable advertising is generally cheaper than other
national advertising outlets, so if cable goes out and strings together
multiple operators that could lower the costs of advertising at the regional
or local level that would make advertising in cable more interesting.
the perspective of overcoming obstacles encountered by CableB2B and
CableHome, project Canoe faces with the prospect of traveling up stream
without a paddle; as overcoming sensitive mutual agreements from a business,
operations, and technical perspective will be challenging. These challenges
combined with cable’s dwindling market share only make the boat that much
smaller. A much better standard would be one that all providers of video
(cable, Internet, Telephone, and Satellite) can agree on rather than just
one industry trying to standardize its own interactive advertising system.
an innovation standpoint, cable industry gets kudos for endeavoring to carve
out a market for itself in the national interactive advertising marketplace.
One would just wish that they had thought of this sooner as the prospects of
multifaceted agreements across vastly different companies to achieve a
unified interactive advertising front seems unlikely – especially if such
agreements are required to battle an enemy with none of these obstacles.
Perhaps all project Canoe really accomplishes is forcing the hand of the
larger operators to further consolidate rather than cajole more agreements
and/or alliances among its elite. On the other hand, the worst thing that
could happen is that project Canoe further slows or stifles one of cable’s
biggest remaining advantages – its collective ability to act independently
and appear to larger telephone companies not just as another large foe it
needs to knock out but rather as many strong companies, each of which can
come up with different innovative solutions that make it nearly impossible
to compete with a one dimensional product line.
|Can Birds-Eye.Net help you or your Company?
Receive your Birds-Eye.Net articles and white
papers hot off
the presses by adding our RSS feed to your reader.