MARKETS FOR MULTIMEDIA BROADBAND

Cable TV Operators Continue to Upgrade Infrastructure; Digital Data and Video Services More Widely Available

SCOTTSDALE, Ariz., March 7, 2001 - Cable television Multiple Systems Operators (MSOs) in the United States are continuing to upgrade their cable TV networks in order to offer digital video, voice, and data services to their subscribers, according to Cahners In-Stat Group (http://www.instat.com). In an annual survey of U.S. cable MSOs, the high-tech market research firm found that the most prominent driver for a cable system upgrade is the strong customer demand for high-speed Internet access. Cable operators are responding to this demand with over 90% of the cable MSOs surveyed now offering high-speed Internet service, up from 32% in late 1999.

Cable MSOs are also moving aggressively to add digital TV channels to their lineups. 64% of the operators surveyed expect to have at least five digital channels available within the next 24 months, while 18% expect to offer more than 30 digital channels. However, the MSOs are still in the process of deploying the digital cable set top boxes that subscribers need to access most digital services. The survey respondents said that only about 15% of their subscribers currently have digital cable TV set top boxes in their homes.

In-Stat's research also found:

• Survey respondents indicated strong, continuing investments in deploying fiber optics in their cable plant. Within 24 months, 42% of respondents indicate that they will have more than 100 miles of fiber optic cable deployed from their primary headend.
• Cable telephony is also on the rise, with 28% of MSOs currently offering voice service, up sharply from just 3% in late 1999. Another 20% of the operators plan to add cable telephony service by the end of 2001.
• About 44% of MSOs surveyed have chosen 64-QAM as the modulation technology for digital TV channels. Another 25% of the respondents stated they have chosen the more expensive 256-QAM modulation system..

The report, "U.S. Cable System Operator Survey: Digital Services on the Rise", (#MB0102DC) is based on an in-depth survey of 48 cable TV systems in the U.S. The report includes analysis of current and future channel allocation strategies, cable modem penetration, cable telephony strategies, equipment suppliers, fiber optics infrastructure, digital transmission technologies, and HDTV strategies. The report also profiles the survey respondents including their number of subscribers, number of homes passed, and number of headends.

To purchase this report, or for more information, please contact Matthew Woods at 617.630.2139; mwoods@instat.com. The report price is $3,995 USD.

Cahners In-Stat Group (http://www.instat.com) covers the full spectrum of digital communications research from vendor to end-user, providing the analysis and perspective that allows technology vendors and service providers worldwide to make more informed business decisions.

For more information, contact:

Kirsten Skedd, Marketing Manager
Phone: 480.609.4534
Email: kskedd@instat.com