Megacable moves forward with its FTTH migration plan

Another of the panels developed during Nextv Series Mexico, which was the last one that took place on the first day of its 2020 virtual edition, was called  ‘The future of cable operators in the D2C era’. The main topics focused on the impact of the arrival of the main D2Cs in Latin America in 2021; the new role of cable operators as aggregators or access providers; and the value of local operators and the future of small TV networks.

The team of industry experts gathered by Dataxis to star in the panel discussion included Hugo Ramos, Commscope’s Chief Regional Technologist; and Raymundo Fernandez, CoCEO at Megacable.

Regarding the transformation of Megacable and where it is going, Fernandez reported that ‘we have seen a very strong evolution as cable operators and that pay TV provider towards a comprehensive communication company. We increasingly see ourselves as an infrastructure company that attacks different market verticals, thanks to the fact that we have a fiber structure, and also hybrid in some cases. We can attack corporate markets, mass markets – which is where they know us best- and carrier markets. Our transformation is based on being a company that provides connectivity in all homes and, through that connectivity, provides value-added services, such as pay TV. To sum up, we see that we are a completely connectivity company; of broadband; that we reach the corporate and residential markets, and that we serve large carrier companies. The key change is given in having gone from being content providers, to being a connectivity and telecommunications infrastructure company’.

Furthermore, regarding the investment and deployment of GPON, Fernandez explained that ‘we are undergoing a very strong transformation to this technology. Megacable continues to be a company where GPON and HFC will coexist, both providing the upload and download speeds that the market requires, with quality standards’. On the other hand, the executive expressed his opinion on whether it will become all FTTH or not,  and said that ‘each country and each economy is different. This migration that we are doing is extremely expensive. In Mexico, we have between 143 and 145 FTTH HPs per kilometer. Our technology is hybrid, and allows a STB to work on the GPON network as well as on the coaxial cable network. I think that this is the most important technological transformation that we are going through, without considering the evolution of the video part’.

Regarding whether the Docsis networks will survive in the future or if a migration will be inevitable, Ramos assured that ‘there is no single solution for all cases. Our role today is based on supporting operators as technological partners, to maximize the infrastructure invested. The executive also expressed that ‘currently, the requirements for higher bandwidth are beginning to change towards requirements of low latency, high reliability and a more deterministic behavior of an end-to-end network. Wireless networks, Docsis and FTTH will need smarter networks, mainly networks that bring the customer closer’.

Fernandez also expressed himself on whether Latin American operators should think of SmartHome as a future plan, and assured that ‘it depends on the maturity of each one and the maturity of the market. Currently we are not focused on SmartHome, because we are focused on making a complete evolution of the network and the next generation video, and we also want to improve the customer’s Wi-Fi experience. There comes a time when it is necessary to choose which project to focus on. We are not prepared, and the market is not requiring it, but it is something that we would possibly do once we finish with all this great migration’.

Regarding whether cable companies will continue to offer pay TV services or will they be an intermediary for a D2C service that comes directly from apps, without going through an STB and going directly to TV or other devices, the Megacable executive assured that ‘that is going to be determined by the time that it costs us the most to provide and have a video subscriber. I do not see that in our countries there will be enough space for all direct to consumers within the Megacable universe, at least in the short term. There is going to be a decrease in subscribers to D2C and we, in that aggregation, with a good user interface, a good user experience and a good offer, will be able to have a vision to be able to provide video services in the coming years. The new generation of video mounted on the Android TV platform, which is what we are launching, is a great experience for the Mexican subscriber’.

Regarding whether there is an opportunity in the future for operators to compete in the universe of virtual assistants, Fernandez reported that ‘we translate it into the use of remote control, based on Google Assistant. We are starting. Voice recognition technology has evolved to such an extent that it is extremely efficient. Everything that is easy and affordable will be part of the evolution. It is a success and it will come to stay’. In addition, the executive added that ‘we are working on advertising by areas of the main cities, but that will come when we have installed the entire project of evolution to GPON. It is quite an aggressive migration. We are changing 5.5 million devices and converting 27 thousand kilometers of network. Advertising will not be the main revenue share that we have, but it allows us to communicate efficiently to subscribers certain advertising and communication announcements’.