Broadband Gear Report

By Laura Hamilton, Editor-in-Chief

1. The Sweet Sound of VoIP — VoIP phone service now sounds better and connects faster than the standard PSTN, according to data collected over the last 12 months by Minacom's standards-based, single-ended service quality test system. Results show that VoIP service quality increased steadily over the last year, with an average MOS of 4.2, compared to 3.9 for the PSTN. Based on a MOS threshold of 3.6, only 1 out of 50 calls in North America were considered to be unacceptable — 1 in 10 worldwide — while greater than 85% of VoIP calls exceeded average PSTN quality over the same period.

Results show that VoIP service bettered PSTN quality worldwide, and improved in all regions over the course of the survey. In addition to superior sound quality, calls over VoIP connected quicker overall — 8.2 seconds on average, compared to 8.9 seconds for those placed over the PSTN. Regionally, the PSTN was faster to connect for calls placed to North America (4.3 seconds vs. 5.7 for VoIP), while international calls connected faster with VoIP (8.7 vs. 10.4 seconds for PSTN). Linear regression indicates that VoIP is closing the gap, connecting 2 seconds faster in July 2006 than a year earlier.

A recent Internet phone quality study by Brix Networks indicated that 1 in 5 calls were classified as unacceptable, and that call quality was steadily declining. As this study may have created the impression that VoIP service is not capable of delivering PSTN-grade phone service, Minacom says that it believes it should be clarified that this report evaluated computer-to-computer (PC-PC) Internet phone service, similar to those offered by Skype, Google Talk, MSN and Yahoo Messenger. The quality and service reliability of these applications does not compare to that of the VoIP phone services offered by cable operators, telcos and broadband VoIP providers who carefully deploy, monitor and manage the quality of their services, according to Minacom.

2. Big Haul Expected for Cable — Cable operators worldwide stand to earn revenues in excess of $1 billion in 2011 from mobile traffic backhaul, according to a study from ABI Research. In contrast, 2006 revenues are forecast to be only $57.6 million. The difference represents a 75% CAGR over the forecast period.

According to Principal Analyst Michael Arden, cable operators' interest in the mobile market takes two forms: "On one hand, cable operators are considering the revenues to be gained from leasing their networks for mobile backhaul. On the other, they are getting involved as direct competitors in the mobile arena, and will brand their own mobile services."

In the United States, most MSOs seem likely to partner with Sprint — using Sprint's base stations and other mobile infrastructure. However, as the cable operators' own mobile brands gain traction, they will backhaul their own traffic. In this scenario, the mobile operators do not quite play the role of MVNOs, because the cable operators will use their own resources for backhaul to save costs. But, Arden says, "This slightly unusual business model works for the cable operators because they have available network capacity, and they feel the need to offer wireless services to compete effectively with the satellite and telco operators in the 'bundled services' arena."