That's according to an article from Reuters.
The news service reports that cable operators are concerned that satcasters DIRECTV and EchoStar will dramatically expand their high-def lineups this year. Spencer Wang, a Bear Stearns analyst, says the cable ops will need to develops new ways to increase bandwidth to stay competitive.
"In the short term, the greatest concern is High Definition TV, given growing HD TV set penetration and DirecTV's plans to offer over 100 national HD feeds by the end of this year," Wang said, according to Reuters.
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However, Reuters writes that the cable companies also must increase capacity without overly increasing their expenditures, which could upset shareholders.
Several companies, such as BigBand Networks, are offering solutions such as Switched Digital Video that saves bandwidth by only delivering a channel to the home when the viewer actually watches it.
Reuters reports that BigBand's stock jumped 30 percent last month when it went public with cable TV operators Comcast, Cablevision and Time Warner already signing on as customers.
Time Warner has said publicly that it believes that Switched Digital Video will enable it to offer as many channels as DIRECTV by year's end.
Cameron Cooke, a Janco Partners analyst, tells Reuters that cable will have to invest in companies such as BigBand to ensure it will have the technology to keep pace.
"Cable is going to have to
invest in some way in all of these different technologies
until they make the leap to full fiber," says Cooke. "I'm
thinking about ten years from now you'll start to see cable
operators taking cable into the home."
Michael Arden, a ABI Research analyst, says Switched Digital
Video could cost each cable system just $5 to $10 per home
in upgrade costs.
Vyyo, which is offering another capacity-enhancing
technology called Spectrum Overlay, says it can enable a
cable operator to increase bandwidth by 3 GHz. However, it
could cost an an average of $125 per home, says Reuters.
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