DOCSIS 3.0 Gaining Traction - Analyst Blog - VanEck ETF Trust VanEck Short Muni ETF (BATS:SMB)

Major cable operators in the U.S. are aggressively deploying high-speed Wideband network based on DCOSIS 3.0 technology. Intense competition among cable operators, satellite carriers, and telecom service providers for broadband market share has forced the cable MSOs to opt for cost effective bandwidth enhancing technology. DOCSIS 3.0 supports throughput of at least 100 Mbps. With DOCSIS 3.0, cable operators are now able to offer one of the fastest Internet speeds available in the market.

In fact, DOCSIS 3.0 is helping the cable MSOs to explore some new markets which were hitherto unexplored by them. The loss in the basic video market are now getting more than recovered in the broadband services segment especially in the cable telephony and the high-speed Internet access market.

As of now, major competitors of DCOSIS 3.0 are the fiber-based network of telecom service providers. However, both the FiOS network of Verizon Wireless (VZ) and U-Verse network of AT&T (T) supports much smaller throughput of around 50-60 Mbps download speed.

Deployment of DOCSIS 3.0 becomes essential for cable MSOs since preference for video-on-demand (watching movie on the Internet) has increased significantly among customers. In addition, demand for online gaming and downloading of various multimedia applications have also increased.

Using DOCSIS 3.0, Comcast Corp. (CMCSA) will start offering 105 Mbps downstream and 10 Mbps upstream speed very soon. Cablevision Systems Corp. (CVC) is already offering 101 Mbps downstream speed. Mediacom Communications Corp. (MCCC) is opting for 105 Mbps Download speed. Time Warner Cable Inc. (TWC) is also deploying DOCSIS 3.0 network.

Another potential future growth area for cable MSOs is the small and medium sized business (SMB) segment. Various industry researches estimate that the SMB segment is a $30 billion market opportunity. Comcast has already launched its business-tier DOCSIS 3.0 service that offers downstream speeds of 100 Mbps and upstream speeds of 15 Mbps.
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