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2012 prediction: The slow death of coax begins

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You might have seen that Verizon (s VZ) uploaded a few new videos to YouTube (s GOOG) Thursday, discussing the future of TV and video in the home. Those videos highlighted two big trends occurring in the pay TV space:

  1. Set-top boxes are shrinking, and will eventually disappear altogether, as users are able to watch video on other connected devices.
  2. Wireless technology will eventually replace wired networking for video distribution in the home.

In both cases, what the videos speak to is a future in which the devices that viewers watch video on — whether they be TVs themselves, or a growing number of mobile handsets or tablets — are connected to that content wirelessly.

There are other reasons to embrace this change, and not just the ability to reach more devices. There’s a huge economic driver here for operators. Streaming live video wirelessly means that they can do away with costly set-top boxes that get installed in homes to decode video signals. While those boxes are typically leased by consumers and act as an additional revenue stream, it’s not clear that operators recoup their investment on that equipment.

Cable and IPTV operators would be able to operate much more profitably if consumers brought their own device with connectivity — which is one reason why Verizon (s VZ) is pushing forward to make its content available on Microsoft’s Xbox Live service, (s MSFT) as well as other connected devices like Roku streaming boxes.

But moving to wireless would also allow those operators to do away with coaxial cable — the stuff that connects every room in the house to TV programming today. Anyone who’s ever added a TV in a new room in his house knows how much of a hassle it can be to deal with coax. While one could theoretically run that coax himself (and some handy homeowners do so!), more often than not, running a TV line to your teenager’s bedroom when she gets a TV for her birthday usually requires a call to the local cable company, a truck roll and a lengthy installation process as a technician installs the new cable.

Those types of support calls are expensive. Certainly more expensive than hooking up a wireless receiver to a TV that connects directly to a single wireless gateway. More expensive than letting your customers hook up a Roku box in their kids’ rooms and downloading an app that will provide all the same content that used to be delivered over coax to a slow, ugly, MPEG-2 set-top behemoth.

Verizon isn’t the only operator looking to cut the coax: AT&T (s T) introduced its own wireless home gateway and wireless receivers earlier this year. We expect more carriers to follow suit in the coming year, as a way to both improve accessibility for consumers and lower costs for themselves.

Photo courtesy of (CC-BY-SA) Flickr user Akarsh Simha

9 Responses to “2012 prediction: The slow death of coax begins”

  1. Coax isn’t dying yet. There are thousand of over the air free local HD TV stations that are wired and antenna hungry.
    As a local installation company ownner, we recive numerous requests for those wired connections, and if you haven’t tried them, you may be missing out.

  2. We all know that TV business will be changed in very near future. I thought it’s definitely right. However, I’ve found that is not that simple actually. There are too many people involved.
    Of course, nobody knows if same situation happens as Mobile devices market did. By the way, don’t forget that two big brothers had failed for several times. Maybe, it’ll be different in next time, but it’s not a piece of cake even for them.

  3. When people in the industry talk about “coax”, it is the cable coming into the house. That is coax or HFC ( hybrid fiber coax) in industry parlance in the context of WAN. In addition to majority of payTV services in the US, majority of the super duper broadband in the us is being delivered on this HFC infrastructure and will be for a while. Coax was never a big deal within the home, so maybe coax in the WAN is really the point to discuss.

  4. This “prediction” about the death of coax is pure non-sense.

    Most American households get their Internet service through coaxial cable. The only competition to coax is:
    1-Slow and unreliable DSL which is a dead technology’
    2-Verizon’s FIOS, the only thing that can compete with coax. Unfortunately, Fibre is very expensive to roll out, and very few places in the US have FIOS available.

    The idea that limited “wireless” service is going to replace the bandwidth required to stream HD movies is just silly.

    Internet via Coax will still be here, long after this idiotic website is long gone.

    • Bob Chip Jones

      I Reject Your Reality & Substitute My Own.
      I have been involved with OSP (Outside Plant) since the late 70’s. In over 32 states and only god knows how many cities first installing coax cable, then upgrading to a Fiber Backbone which is where the majority of cable companies stand today. Most of these companies just over-lashed the fiber to the existing coax and then
      upgraded the coax to fit the new design. The life expectancy of your larger diameter cables (500,750) is around 30 years just in expansion and contraction
      which does not include the ripping apart of connections
      during an upgrade which was done as fast as possible by
      hiring contractors who paid there people a”Piece Rate”
      to rip this stuff apart to upgrade.
      That being said,the main coax is reaching if not already
      there it’s life expectancy. Ingress and egress is becoming
      more and more of a problem as well as consuming much of the
      maintenance budget of these cable systems.
      Wireless systems have there limitations and the need for
      a hard line will always exist.
      As time goes by here in the VERY NEAR future, coax cable WILL be phased out due to the maintenance costs,life expectancy as well as the low carrying capacity. Cable companies have been trying to squeeze more and more
      out of their bandwidth, which with aging cable makes this
      a difficult task at best.
      I predict when the economy takes it’s next upswing, there
      will be another cable boom. At current,2012 the prices of fiber optic cable and equipment is starting to come down as more and more companies start using the technology. Coax Will and MUST be replaced to keep up with the consumers high demand for bandwidth. You will start to see this Coax replacement with such technologies as FTTC (Fiber to the curb)as well as other coax replacement methods. This technology is already being deployed in some areas of the country now.
      Now, there will be a need for the small coax running in your home, however this will also be phased out as the price to replace this comes down as well.

  5. Coax is the primary means of accessing TV and internet in my home. All wiring to all other rooms was done by me. At first, the cable was connecting my TVs in several rooms to the antenna which was in the attic, like a bat, hanging upside down. When I signed up with Comcast, I found that one of the 3-way connectors in the attic had broken down due to the summer heat over 20 years. All the cable and splitters have been replaced with RU6. Only one TV is connected by the cable company’s box. The others are connected straight to the wall outlet, getting their signals from the cable as it comes from the street. Or it WAS that way until Comcast decided to make life difficult by requiring me to have digital boxes in between the cable and the TVs. Now I have to settle for the less than HD signal as well as all the features my TVs have that are no longer accessible since the TV remote is useless; I have to use the DTA. All of this is to ‘encourage’ me to buy Comcast’s HD programming.

    What will happen to my reception and the features that were built into my TVs if cable is replaced by wireless?

  6. The prediction does not resonate well with the news on Verizon’s commitment to stop expanding FIOS. It rather suggests the short term will be return to Coax, delay os skip fiber optics to allow Comcast to realize return on Coax investment while Verizon prepares for wireless broadband media delivery. The later is not a 2012 reality when it compares to the availability and speed of FIOS.