Cisco Bets Heavy on Landing Cablecos in RBOC Absence

While most infrastructure providers are at The Cable Show to pitch products to their cableco customers and expand their current base, some say the stake are higher for Cisco Systems Inc., which is pushing its content distribution technology to operators because it lacks key RBOC accounts.

When it comes to Tier 1 telco IPTV deployments in the United States, Cisco is on the outside looking in – longingly at the tandem of Microsoft Corp. and Alcatel-Lucent, which have the coveted AT&T U-verse IPTV project.

With Verizon also teamed with Microsoft and with BellSouth now part of AT&T, it appears to be time for Cisco and its many IPTV-related acquisitions to look elsewhere hard and fast. Enter this week’s NCTA.

“Cisco wants that deal, but even more they need to have the MSOs in their pocket because they don’t have the RBOCs,” explained Tom Nolle, president of CIMI Corp. “If the cable companies follow Microsoft/Alcatel (the ‘proprietary format’) then Cisco is shut out of IPTV.”

That’s a scary thought for any networking company, but far more so for Cisco. It has shelled out billions of dollars in the past few years for the likes of Scientific Atlanta, Linksys Corp. and Arroyo Video Solutions and has invested in content protection firm Widevine Inc.

Cisco’s CDS Internet Streaming is not the only delivery capability the company plans to support. “We support both streaming using protocols such as Windows Media RTSP and progressive rendering using HTTP,” the company said in a reply to an inquiry as to how the product differs from what’s already done on the Internet.

The vendor added that CDS helps enable cable operators scale their video streaming while ensuring a high quality end user experience and minimizing CAPEX. Internet streaming is generally done in one of two ways: The first is to use a content delivery network (CDN) service and the second is to use a proprietary streaming system.

Cisco is betting heavy in Las Vegas that it can get cablecos to tackle streaming its way instead of outsourcing to a CDN, reasoning that support of multiple streaming formats and of PacketCable multimedia for QoS will be big lures.

“In today’s competitive landscape, service providers need to provide a differentiated, highly personalized customer experience,” said Paul Bosco, vice president of cable and video initiatives of Cisco. “By incorporating the Cisco Internet Streaming solution directly into our Content Delivery System, Cisco is providing flexible and powerful options to increase customer satisfaction and help enable service providers to deploy a variety of next-generation, value-added video entertainment services and much more.”

Nolle has another perspective on the Cisco news.

“They’re pretty much counterpunching against Microsoft/Alcatel there; obviously they’re afraid that that duo will carry their win into cable,” he said.

While Cisco claims cable giant Time Warner for its CDS, only time will tell if it holds off rivals and builds enough of a customer to offset the limited RBOC opportunities.

Cisco said CDS Internet Streaming is scheduled to be available in the third quarter of 2007, adding it is in trials with a number of service providers that it did not identify.

AT&T Inc. www.att.com
Alcatel-Lucent www.alcatel-lucent.com
Cisco Systems, Inc. www.cisco.com
Microsoft Corp. www.microsoft.com
Time Warner Cable Inc. www.timewarner.com
Verizon Communications Inc. www.verizon.com

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