Consumption-based pricing model may make it easier for incumbent ISPs to provide high-speed broadband.
Building a slide deck, pitch, or presentation? Here are the big takeaways:
- Cisco is rolling out a licensing plan for its cable operators that use the Converged Broadband Router platform, designed to make it easier to provide high-speed broadband to consumers.
- The plan could make it cheaper for incumbent ISPs to provide high-speed internet, potentially allowing them to compete with fiber-to-the-home providers like AT&T Fiber and Google Fiber.
Cisco is launching a new licensing plan for cable operators to make it easier for them to provide high-speed broadband, the company announced Monday at CES 2018.
The Infinite Broadband Unlocked (IBU) program simplifies the licensing process, therefore potentially reducing the cost of providing multi-gigabit services, the press release said. With lower costs, cable operators-who are the incumbent internet service providers (ISPs) in many areas-may be able to more effectively compete with fiber-to-the-home services like AT&T and Google Fiber.
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To simplify licensing, the plan only offers one consumption-based license type to operators. Instead of buying several licenses for every group of the market they want to service, an operator could buy just the one license and focus more on business outcomes, the release said.
"IBU helps cable operators be more competitive and gain subscriber market share," said Sean Welch, vice president and general manager, Cable Access, Service Provider Business, Cisco, in the release.
The licensing is tied to the number of subscribers, making the cost to the operator aligned with revenues, the release said.
While fiber internet providers, like Google Fiber, have been considered distant players in the market, analysts say their existence pushes incumbent ISPs to find ways to reduce costs while increasing speeds in order to compete. Cisco's plan is one potential way for them to compete.
After a near company meltdown in October 2016, Google Fiber grew rapidly in 2017, launching in three new cities. With the help of a new way of laying fiber-shallow trenching-Fiber was able to launch in Louisville, KY in five months. While the company hasn't announced any upcoming cities for 2018, the growth may light a fire for incumbent ISPs.
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The announcement also comes in the wake of the FCC's decision to end net neutrality in December, giving ISPs more power to throttle speeds or charge extra for certain content. It remains to be seen if ISPs will provide the high-speed internet made possible by this plan, or if the speeds will be throttled.
IBU is now available to all Cisco Converged Broadband Router (cBR-8) customers worldwide, according to the release.
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