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Cable Telephony: The Threat to Small Business ILEC Markets 2007-2012
a market research report
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Cable companies have been on a fast track, upgrading their
networks to provide integrated digital video, high-speed data
and voice services—which means incumbent telcos now face stiff
competition from cable operators aiming to supply small
enterprise customers with a bundled services. With
competitors like Cox Communications, CableVision, Comcast,
Charter, Time-Warner, and other top-tier cable operators launching
telephone services to small business, the ILECs
face a situation comparable to what AT&T faced in the years just
after Divestiture.
In this new research study, Insight examines a highly accessible
(and lucrative) market for cable’s value-added services. TV ad
insertions for cable telephony services are targeted at some 73
million cable customers, and take rates for telephony offers have
approached 20 percent in some markets. In this report, Insight Research analyzes the telephony and
enhanced services that cable providers currently offer small businesses using four delivery options: standard
telephony, channelized HFC, dedicated modem and shared
modem service. Based on this examination, Insight quantifies the
addressable market opportunity for cable companies in two-way
capable cable markets, and measures the competitive risk they
pose to the incumbent telephone carriers located within the cable
systems’ service areas.
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Report Excerpt
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1.1 Cable Telephony and Broadband Services for the Small Enterprise
Competition is already fierce between the providers of residential telephone and broadband data services, but the competition for the small enterprise market is just beginning to heat up. INSIGHT Research defines the small enterprise segment as businesses with less than 100 employees. On a per-customer basis, revenue associated with providing a small enterprise with data and voice services can generate three to four times the revenue of the residential customer buying a bundle of voice, data, and video services.
The local exchange carries (LECs) and the cable television multiple system operators (MSOs)
have seen a surge in their subscriptions to bundled telephone and data
services in the last year. Current estimates place the subscription to
broadband services at more than 50 million....
Download the
Free Executive Summary
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Market Segmentation
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By Carrier
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ILECs
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MSOs |
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AT&T
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Armstrong |
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Bellsouth |
Atlantic Broadband |
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Centurytel |
Blue Ridge |
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Cincinnati
Bell |
Brighthouse |
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Citizens Telecommunications |
Buckeye |
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Embarq |
CableOne |
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Hawaiian Telecom
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Cablevision |
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Iowa Telecomm Services |
Charter |
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Qwest
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Comcast |
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TDS
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Cox |
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Verizon
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GCI |
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Windstream
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Insight |
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Knology |
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Mediacom |
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Midcontinent |
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Millenium |
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Northland |
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Suddenlink (Cebridge) |
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Time Warner |
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WOW! |
By Enterprise by Industry Sector
Retail Trade
Health Care
and Social Assistance
Finance and
Insurance
Accommodation
and Food Services
Wholesale
Trade
Professional,
Scientific and Technical Services
Administrative, Support, Waste Management and Remediation Services
Manufacturing
Construction
Other
Services (except Public Administration)
Real Estate,
Rental and Leasing
Transportation
Management of
Companies and Enterprises
Educational
Services
Information
Arts,
Entertainment, and Recreation
Utilities
Mining
Undefined
Agriculture,
Forestry, Fishing and Hunting
Small Enterprise Lines by Sector
Medium and
Large Enterprise Lines by Sector
Small
Enterprise Lines Losses/Gains by Carrier
Small
Enterprise Revenue Losses/Gains by Carrier
By Cable Company
Line
Potential By Sector By Employee Size
High Speed
Internet Offer
Telephony
Offer
By LEC
By MSO
Competitor: Number of Small Businesses and SE Lines
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Table of Contents
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Chapter I EXECUTIVE SUMMARY 1.1 Cable Telephony and Broadband Services for the Small Enterprise 1.2 The Small Enterprise Market for High-Speed Data and Voice
Chapter II CABLE NETWORK TECHNOLOGY 2.1 Development of the CATV Network
2.1.1
Traditional Coax Network
2.1.2 HFC
2.1.2.1 HFC Components
2.1.2.2 HFC Topology 2.2 Circuit Switched Cable Telephony 2.3 Circuit Switched With Hybrid IP Networks 2.4 IP Cable Telephony
2.4.1
Data over Cable Service Interface Specification (DOCSIS)
2.4.1.1 DOCSIS 1.1 & 2.0
2.4.1.2 DOCSIS 3.0
2.4.2 PacketCable
2.4.2.1 PacketCable 1.1 & 1.2 2.5 Cable IP Telephony Implementation Issues
2.5.1 Primary Line Service/E911
2.5.2 Communications Assistance for Law Enforcement Act (CALEA)
Chapter III TELCO BROADBAND TECHNOLOGY IMPLEMENTATION 3.1 Digital Subscriber Line (DSL) 3.2 Fiber to the Premise (FTTP) Architecture
Chapter IV THE SMALL ENTERPRISE MARKET DEMOGRAPHICS 4.1 Classification of Businesses
4.1.1 Agriculture, Forestry, Fishing and Hunting
4.1.2 Mining
4.1.3 Utilities
4.1.4 Construction
4.1.5 Manufacturing
4.1.6 Wholesale Trade
4.1.7 Retail Trade
4.1.8 Transportation and Warehousing
4.1.9 Information
4.1.10 Finance and Insurance
4.1.11 Real Estate, Rental and Leasing
4.1.12 Professional, Scientific, and Technical Services
4.1.13 Management of Companies and Enterprises
4.1.14 Administrative, Support, Waste Management and Remediation Services
4.1.15 Educational Services
4.1.16 Health Care and Social Assistance
4.1.17 Arts, Entertainment, and Recreation
4.1.18 Accommodation and Food Services
4.1.19 Other Services (except Public Administration)
4.1.20 Public Administration
4.1.21 Undefined 4.2 The Classification of Businesses by Size 4.3 Distribution of Business by Size 4.4 The Business Line Market Methodology and Analysis 4.5 The Business Line Market in Small Enterprises 4.6 Small Enterprises as an Opportunity Space
Chapter V LEC AND MSO COMPETITIVE SMALL ENTERPRISE BUSINESS LINE MARKETS 5.1 The LEC Business Line Market 5.2 The LEC Small Enterprise Business Line Market 5.3 The MSO Small Enterprise Business Line Market
Chapter VI THE MSOs SMALL ENTERPRISE MARKET POTENTIAL AND BUSINESS SERVICES OFFERS 6.1 MSOs
6.1.1 Adelphia
6.1.2 Armstrong Cable
6.1.3 Atlantic Broadband
6.1.4 Blue Ridge
6.1.5 Bright House
6.1.6 Buckeye
6.1.7 CableOne
6.1.8 Cablevision
6.1.9 Charter
6.1.10 Comcast
6.1.11 Cox
6.1.12 GCI
6.1.13 Insight
6.1.14 Knology
6.1.15 Mediacom
6.1.16 MidContinent
6.1.17 Millenium
6.1.18 Northland
6.1.19 Suddenlink (Cebridge)
6.1.20 Time Warner
6.1.21 WOW!
Chapter VII THE LECs SMALL ENTERPRISE MARKET POTENTIAL AND BUSINESS SERVICE OFFERS 7.1 LECs
7.1.1 Alaska Communications Systems (ACS)
7.1.2 AT&T
7.1.3 BellSouth
7.1.4 CenturyTel
7.1.5 Cincinnati Bell
7.1.6 Citizens Communications
7.1.7 Embarq
7.1.8 Hawaiian Telecom
7.1.9 Iowa Telecomm Services
7.1.10 Qwest
7.1.11 Telephone and Data Systems (TDS)
7.1.12 Verizon
7.1.13 Windstream
Chapter VIII MSO VERSUS ILEC MARKET OVERLAYS 8.1 MSO Market Overlays of ILECs
8.1.1 Alaska Communications Systems (ACS)
8.1.2 AT&T
8.1.3 Bellsouth
8.1.4 CenturyTel
8.1.5 Cincinnati Bell
8.1.6 Citizens Communications
8.1.7 Embarq
8.1.8 Hawaiian Telecom
8.1.9 Iowa Telecomm Services
8.1.10 Qwest
8.1.11 Telephone and Data Systems (TDS)
8.1.12 Verizon
8.1.13 Windstream
Appendix GLOSSARY Table of Figures
Chapter II II-1 Traditional Tree-and-Branch Coax Architecture II-2 Coax Distribution to Customer Premises II-3 HFC Architecture Providing Voice and Video Services II-4 Circuit Switched Cable Telephony II-5 Typical Cable Frequency Spectrum Allocation II-6 Circuit Switched with Hybrid IP Network Architecture II-7 Cable IP Telephony II-8 Basic DOCSIS II-9 Basic PacketCable Architecture
Chapter III III-1 Voice over DSL Generic Architecture III-2 Telco Fiber to the Premise Architecture
Chapter V V-1 Distribution of Small Enterprises by Business Employee Size in the ILEC Markets Table of Tables
Chapter I I-1 Business Lines by Industry Sector
: Small Enter vs. Large and Medium Enter I-2 List of Major ILECs & MSOs Analyzed I-3 Small Enterprise Business Line Loss Estimates for the ILECs, 2007-2012 I-4 Small Enterprise Business Line Revenue Loss Estimates for ILECs
($39/line)
Chapter II II-1 DOCSIS Evolution: Service Comparison II-2 DOCSIS Evolution: Customer Equipment Supported II-3 DOCSIS Evolution: Upload/Download Speeds Supported
Chapter III III-1 The Versions and Features of xDSL III-2 Fiber Installation Cost Estimates III-3 FTTP Cost Analysis: Earnings per Share Impacts
Chapter IV IV-1 US Business Distribution: All Business Sizes
IV-2 Business Establishments by Industry Sector and Business Size: IV-3 Business Lines: Distribution by Industry Sector 53
IV-4 Business Lines by Industry Sector and Business Size: IV-5 Business Lines by Industry Sector and Business Size - Small Enterprises
Chapter V V-1 US Total Access Line Trends: Residential and Business, 2001-2004 V-2 US ILEC Access Line Trends: Residential and Business, 2001-2004 V-3 US CLEC Access Line Trends: Residential and Business, 2001-2004 V-4 US Total Access Line Trends: Residential and Business, 2005-2006 V-5 US ILEC Access Line Trends: Residential and Business, 2005-2006 V-6 US CLEC Access Line Trends: Residential and Business, 2005-2006 V-7 Traditional US Business Line Estimates, 2006-2012 V-8 ILEC Annual Business Line Losses: All Business Sizes, 2007-2012 V-9 Annual ILEC Business Line Revenue Losses ($39/line), 2007-2012 ($Millions) V-10 Enterprises Lost by the ILECs to Competitors in All Business Sizes, 2007-2012 V-11 Enterprise Level Revenue in All Sizes Lost by the LECs to Competitors, 2007-2012 V-12 Distribution of Small Enterprises among the Top LECs 65 V-13 Distribution of the Small Enterprise Business Lines among Top ILEC Markets V-14 Small Enterprise Business Line Loss Estimates for the ILECs, 2007-2012 V-15 Small Enterprise Business Line Revenue Loss Estimates for ILECs
($39/line), V-16 Five-Year Small Enterprise Business Line Losses by ILEC V-17 Five-Year Total Small Enterprise Business Lines Revenue Loss ($39/line) by ILECs V-18 Distribution of Small Enterprises Lost by ILEC over Five-Year Forecast V-19 Distribution of Cumulative Small Enterprise Revenue Losses by ILEC
V-20 Small Enterprises and Business Lines Distribution by Industry Sectors
V-21 Distribution of Small Enterprise Establishments and Small Enterprise
Business Lines
Chapter VI VI-1 Adelphia Holding Company: Small Enterprise Industry Line Potential by Emp Size VI-2 Armstrong Cable: Small Enterprise Industry Line Potential by Employee Size VI-3 Armstrong Cable: High-Speed Cable Offerings VI-4 Atlantic Broadband: Small Enterprise Industry Line Potential by Employee Size VI-5 Atlantic Broadband: High-Speed Cable Offerings VI-6 Blue Ridge: Small Enterprise Line Potential by Industry by Employee Size VI-7 Blue Ridge: Cable and Telephony Offering VI-8 Blue Ridge: High Speed Internet Offering VI-9 Bright House: Small Enterprise Line Potential by Industry by Employee Size VI-10 Bright House: High-Speed Internet Offering VI-11 Buckeye: Small Enterprise Line Potential by Industry by Employee Size VI-12 Buckeye: High-Speed Internet Offering VI-13 CableOne: Small Enterprise Line Potential by Industry by Employee Size VI-14 CableOne SOHO Internet Offers VI-15 Cablevision: Small Enterprise Line Potential by Industry by Employee Size VI-16 Cablevision: Business High-Speed Internet Packages VI-17 Cablevision: Business Telephony Offering VI-18 Cablevision: Business Bundle of High Speed Internet and Telephony VI-19 Charter: Small Enterprise Line Potential by Industry by Employee Size VI-20 Charter: High-Speed Internet Service Offerings VI-21 Comcast: Small Enterprise Line Potential by Industry by Employee Size VI-22 Comcast: Business High-Speed Internet Service Offerings VI-23 Comcast: Residential Digital Telephone Offerings VI-24 Cox: Small Enterprise Line Potential by Industry by Employee Size VI-25 Cox: Business Internet Service Offerings VI-26 GCI: Small Enterprise Line Potential by Industry by Employee Size VI-27 GCI: Business Internet Service Offerings VI-28 Insight: Small Enterprise Line Potential by Industry by Employee Size VI-29 Insight: Business Internet Service Offerings VI-30 Knology: Small Enterprise Line Potential by Industry by Employee Size VI-31 Knology: Business Internet Service Offering VI-32 MediaCom: Small Enterprise Line Potential by Industry by Employee Size VI-33 Mediacom: Business Internet Service Offerings VI-34 MidContinent: Small Enterprise Line Potential by Industry by Employee Size VI-35 Midcontinent Business Internet Service Offerings VI-36 Mellenium: Small Enterprise Line Potential by Industry by Employee Size VI-37 Millenium: High-Speed Internet and Telephone Pricing VI-38 Northland: Small Enterprise Line Potential by Industry by Employee Size VI-39 Northland: Internet Service Offerings VI-40 Suddenlink: Small Enterprise Line Potential by Industry by Employee Size VI-41 Suddenlink: High-Speed Internet Offerings VI-42 Time Warner: Small Enterprise Line Potential by Industry by Employee Size VI-43 Time Warner: Internet Service Offerings VI-44 Mellenium: Small Enterprise Line Potential by Industry by Employee Size VI-45 WOW! Small Business Internet and Voices Services
Chapter VII VII-1 ACS Small Enterprise Business Line Potential VII-2 ACS Business High-Speed Offerings VII-3 ACS Business Phone Service Offerings VII-4 AT&T Small Enterprise Business Line Potential VII-5 AT&T Business High-Speed Offerings VII-6 BellSouth Small Enterprise Business Line Potential VII-7 BellSouth Business High-Speed Offerings VII-8 BellSouth Business Telephone Offerings VII-9 CenturyTel Small Enterprise Business Line Potential VII-10 CenturyTel Business High-Speed Offering VII-11 Cincinnati Bell Small Enterprise Business Line Potential VII-12 Cincinnati Bell Business High-Speed Offering VII-13 Cincinnati Bell Business Telephone Offerings VII-14 Citizens Small Enterprise Business Line Potential VII-15 Citizens Business High-Speed Offerings VII-16 Citizens Business Telephone Offerings VII-17 Embarq Small Enterprise Business Line Potential VII-18 Embarq Business High-Speed Offerings VII-19 Embarq Business Telephone Offering VII-20 Hawaiian Telecom Small Enterprise Business Line Potential VII-21 Hawaiian Telecom Business High-Speed Offering VII-22 Iowa Telecom Small Enterprise Business Line Potential VII-23 Iowa Telecom Business High-Speed Offerings VII-24 Qwest Small Enterprise Business Line Potential VII-25 Qwest Business High-Speed Offerings VII-26 Qwest Business Telephone Offerings VII-27 TDS Small Enterprise Business Line Potential VII-28 TDS Business High-Speed Offerings VII-29 Verizon Small Enterprise Business Line Potential VII-30 Verizon Business High-Speed DSL Offerings VII-31 Verizon Business High-Speed FIOS Offerings VII-32 Windstream Small Enterprise Business Line Potential VII-33 Windsteam Business High-Speed Offerings VII-34 Windstram Business Telephone Offerings
Chapter VIII VIII-1 ACS: MSO Competitors by Line Size VIII-2 AT&T: MSO Competitors by Line Size VIII-3 Bellsouth: MSO Competitors by Line Size VIII-4 CenturyTel: MSO Competitors by Line Size VIII-5 Cincinnati Bell: MSO Competitors by Line Size VIII-6 Citizens: MSO Competitors by Line Size VIII-7 Embarq: MSO Competitors by Line Size VIII-8 Hawaiian Telecom: MSO Competitors by Line Size VIII-9 Iowa Telecom: MSO Competitors by Line Size VIII-10 Qwest: MSO Competitors by Line Size VIII-11 TDS: MSO Competitors by Line Size VIII-12 Verizon: MSO Competitors by Line Size VIII-13 Windstream: MSO Competitors by Line Size
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