CPE Management and the Xbox

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What is the future of CPE Management?

The release update of the XBOX Metro shouldraise the eyebrows of cable MSO executivesfor several reasons but none more important

than the inevitable impact on the long-term future

ofCPE management.

New Xbox Update

The Xbox is already a media center allowing thedownload of video and music as well as streamcontent from home computers. The new update toXbox Metro contains features such as remote controlof the Xbox for Windows phone users and the abilityto queue content for the TV.

It is the last part (content for the TV) that is importantbecause Xbox has entered into agreements with over40 content providers. Some of the content lined upis/will be coming from:

Verizon FiOS (25 HD channels) ComcastXnityondemandapplication(not

with release but coming) HBO Go (not with release but coming) UFC ESPN

Syfy channel

The advancement of the Xbox will certainly gene-rate future content wars (remember that Comcast

purchased a 51% stake in NBC Universal) and couldwell provide Microsoft the foothold they need tobecome the dominate operating system for homeconsoles.

TheJusticeDepartmentandvestateattor-neys general have reached a court settlementallowing the companies to proceed with theircombination, subject to conditions intended topreserve competition among TV providers.regulators are requiring Comcast to make NBC

programming available to competitors such assatellite companies, as well as new Internetvideo services that could pose a threat to thecompanys core cable business.

Source:Joelle Tessler, Associated Press

There is no doubt that internet and WiFi access willbecome increasingly important. But whether or notthe traditional cable TV subscriber remains a viablemarketsegmentorisreplacedwiththeprotsfromcontent control/production is yet to be determined.However, these discussions are beyond the scopeof this article.

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How the Xbox changes CPEManagement

Why is the Xbox important to customer premiseequipment CPE management? The use of the Xboxfor content makes the Xbox and subsequent gene-rations of consoles including Apple TV, a naturalreplacement for the set-top boxes currently being

used by most cable subscribers.

At the heart of all cable operations is the mana-gement of CPE. CPE includes set-top boxes, cable,ttings,connectors,remotecontrolsandeverythingelse used to connect cable services into homes orbusinesses.

CableMSOsacrossthenationhavewarehouseslledwith millions of CPE inventory that is currently beingmanaged with cable warehouse management sys-tems that handle everything from distribution torepairs and serialized reconciliations.

As the development of the Xbox or other mediacenter consoles advances, cable MSOs will start tosee a decline in the need for their CPE hardware.Eventually the older proprietary set-top boxes willbe become obsolete. In all likelihood, cable MSOs willno longer be supplying set-top boxes in 10-15 years.

A Change in CPE Management Skill set

The good news is cable MSOs have a decade or sobefore CPE management for set-top boxes becomesa more minor part of operations. What is unknownis how much CPE (new media center consoles) cableMSOs will be involved with. Certainly cable MSOswill need to be able to provide a media center/set-top box to some subscribers but how many is un-

determined.

Logically, cable MSOs will be able to breathe a sighof relief when CPE theft and hub and spoke distri-bution systems no longer have the same operatio-nalsignicance.InsteadtheopportunityforcableMSOs will be to raise the skill levels for installationtechnicians and customer service support staff.

Subscribers will want their connected services tobe programmed for all their media center consoles.

Installation technicians and customer service re-presentativeswillneedtobeWindowsprocientas well as be able to troubleshoot a variety of ap-plication issues.

A Final Note

As the technological complexity increases, new ar-rangements will need to be made for media centerconsole support. My instinct tells me that subscri-bers lose access to content they will either blameMicrosoft or the cable MSO. Without clear cut res-ponsibilities between cable MSOs and Microsoft,subscriber issues may open the door for one-stopsolutions and competitors.

What this all means is that cable MSO executivesshould be formulating an exit strategy for CPE ma-nagement. Their exit strategy should include:

Scaling back cable warehouse operations Setting the foundation and training pro-

grams necessary to be able to provide subs-

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cribers exceptional quality service. Understanding and constructing support

agreements for issues with operating sys-tem providers.

In the meantime, cable MSOs can protect their cur-rent CPE investments by making sure they use acable warehouse management system to minimizeCPE theft, track CPE inventory anywhere in their

system and manage contractors. The savings from acable warehouse management system can be usedto help fund the exit strategy.

Tell us your thoughts on how the Xbox or AppleTV will affect how cable MSOs conduct future ope-rations. Please take the time to complete the shortsurvey below. We will email you back the results

If you liked this article you may also enjoy reading:

Cable MSO Trend Survey

Below are a few survey questions. Providing youremail address will allow Mintek to send you theresults of the survey!

Email for survey results only How will the integration with alternative

content providing devices impact yourtraditional CPE purchases over the next 5years?

Willhavesignicantimpact Will have an impact Will have little impact Will have no impact

How will the integration with alternativecontent providing devices impact yourtraditional CPE purchases over the next 5years?

Willsignicantlyimpact Will have an impact Will have little impact Will have no impact

How will content integration with consumerdevices impact your Supply Chain capital,planning and resource budgets over thenext 2-5 years?

Willhavesignicantimpact Will have an impact Will have little impact Will have no impact

Assuming this technology trend continues,

how long will Cable MSOs spend capitalfunds on CPE not part of the consumer pro-duct 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 purchasingmodel to offer consumer devices as part of

their product offering?

Cable CPE, cable cpe theft, Cable Warehouse Ma-nagement

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