07/12/2011 22:50
mintek.com
What is the future of CPE Management?
T
he release update of the XBOX Metro should raise the eyebrows of cable MSO executives for several reasons but none more important than the inevitable impact on the long-term future of CPE management.
New Xbox Update
• Syfy channel The advancement of the Xbox will certainly generate future content wars (remember that Comcast purchased a 51% stake in NBC Universal) and could well provide Microsoft the foothold they need to become the dominate operating system for home consoles.
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“The Justice Department and five state attorneys general … have reached a court settlement allowing the companies to proceed with their combination, subject to conditions intended to preserve competition among TV providers…. regulators are requiring Comcast to make NBC programming available to competitors such as satellite companies, as well as new Internet video services that could pose a threat to the company’s core cable business.” The Xbox is already a media center allowing the download of video and music as well as stream content from home computers. The new update to Xbox Metro contains features such as remote control of the Xbox for Windows phone users and the ability to queue content for the TV. It is the last part (content for the TV) that is important because Xbox has entered into agreements with over 40 content providers. Some of the content lined up is/will be coming from:
Source: Joelle Tessler, Associated Press There is no doubt that internet and WiFi access will become increasingly important. But whether or not the traditional cable TV subscriber remains a viable market segment or is replaced with the profits from content control/production is yet to be determined. However, these discussions are beyond the scope of this article.
• Verizon FiOS (25 HD channels) • Comcast Xfinity on demand application (not with release but coming) • HBO Go (not with release but coming) • UFC • ESPN
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07/12/2011 22:50
mintek.com What is the future of CPE Management?
How the Xbox changes CPE Management
A Change in CPE Management Skill set The good news is cable MSOs have a decade or so before CPE management for set-top boxes becomes a more minor part of operations. What is unknown is how much CPE (new media center consoles) cable MSOs will be involved with. Certainly cable MSOs will need to be able to provide a media center/settop box to some subscribers but how many is undetermined.
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Why is the Xbox important to customer premise equipment CPE management? The use of the Xbox for content makes the Xbox and subsequent generations of consoles including Apple TV, a natural replacement for the set-top boxes currently being used by most cable subscribers. At the heart of all cable operations is the management of CPE. CPE includes set-top boxes, cable, fittings, connectors, remote controls and everything else used to connect cable services into homes or businesses. Cable MSOs across the nation have warehouses filled with millions of CPE inventory that is currently being managed with cable warehouse management systems that handle everything from distribution to repairs and serialized reconciliations. As the development of the Xbox or other media center consoles advances, cable MSOs will start to see a decline in the need for their CPE hardware. Eventually the older proprietary set-top boxes will be become obsolete. In all likelihood, cable MSOs will no longer be supplying set-top boxes in 10-15 years.
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Logically, cable MSOs will be able to breathe a sigh of relief when CPE theft and hub and spoke distribution systems no longer have the same operational significance. Instead the opportunity for cable MSOs will be to raise the skill levels for installation technicians and customer service support staff. Subscribers will want their connected services to be programmed for all their media center consoles. Installation technicians and customer service representatives will need to be Windows proficient as well as be able to troubleshoot a variety of application issues.
A Final Note As the technological complexity increases, new arrangements will need to be made for media center console support. My instinct tells me that subscribers lose access to content they will either blame Microsoft or the cable MSO. Without clear cut responsibilities between cable MSOs and Microsoft, subscriber issues may open the door for one-stop solutions and competitors. What this all means is that cable MSO executives should be formulating an exit strategy for CPE management. Their exit strategy should include: • Scaling back cable warehouse operations • Setting the foundation and training programs necessary to be able to provide subs-
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mintek.com What is the future of CPE Management?
cribers exceptional quality service. • Understanding and constructing support agreements for issues with operating system providers. In the meantime, cable MSOs can protect their current CPE investments by making sure they use a cable warehouse management system to minimize CPE theft, track CPE inventory anywhere in their system and manage contractors. The savings from a cable warehouse management system can be used to help fund the exit strategy. Tell us your thoughts on how the Xbox or Apple TV will affect how cable MSOs conduct future operations. Please take the time to complete the short survey below. We will email you back the results If you liked this article you may also enjoy reading:
Cable MSO Trend Survey
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Below are a few survey questions. Providing your email address will allow Mintek to send you the results of the survey! • Email for survey results only • How will the integration with alternative content providing devices impact your traditional CPE purchases over the next 5 years? • Will have significant impact • Will have an impact • Will have little impact • Will have no impact • How will the integration with alternative content providing devices impact your traditional CPE purchases over the next 5 years? • Will significantly impact • Will have an impact • Will have little impact • Will have no impact
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• How will content integration with consumer devices impact your Supply Chain capital, planning and resource budgets over the next 2-5 years? • Will have significant impact • Will have an impact • Will have little impact • Will have no impact • Assuming this technology trend continues, how long will Cable MSOs spend capital funds on CPE not part of the consumer product cycle? • Less than 5 years • More than 5 years but less than 10 years • More than 10 years but less than 15 years • More than 15 tears • Will Cable MSOs transition their purchasing model to offer consumer devices as part of their product offering? Cable CPE, cable cpe theft, Cable Warehouse Management
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Other Articles Written by stuart smith Stuart Smith is Mintek’s InBound Marketing Specialist. He works hard at creating compelling content to keep Mintek’s customers and prospects entertained with relevant information.
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