The cable TV industry is substantially benefitting from the small and mid-sized business (SMB) segment. Significant improvement in business data and video traffic is expected to act as a future growth catalyst for the industry.
Furthermore, managing wireless backhaul traffic for mobile towers has also opened up a multi-billion dollar market opportunity. Cable operators are now gradually offering innovative wireless broadband services to business customers in order to maintain this favorable momentum.
According to a recent report by research firm Dell’Oro, the market size of global wireless backhaul equipment will reach $8 billion by 2018. Also within this market, router and switch revenues will grow at a compounded annual growth rate (CAGR) of 5% while transmission equipment revenues will rise at a CAGR of 2% in the next 5 years.
Another research firm, Informa Telecoms & Media, has estimated that the public access small cell market will likely be worth $16 billion by 2016. Significant growth of 4G LTE (Long term Evolution) and growing deployment of small cells are the primary reasons for this encouraging outlook.
Large cable TV operators such as Comcast Corp. (CMCSA - Analyst Report) and Time Warner Cable Inc. (TWC - Analyst Report) are immensely exploring the SMB segment as a counter-strategy to protect their loss in the legacy video-offering market as telecom giants like Verizon Communications Inc. (VZ - Analyst Report) and AT&T Inc. (T - Analyst Report) are aggressively offering fiber-based video services.
Various industry researches estimate that the SMB segment is expected to offer a market opportunity worth $20 - $30 billion. In 2013, Comcast and Time Warner Cable generated $3,241 million (up 26.4% year over year) and $2,312 million (21.6% year over year) revenues respectively, from the SMB segment.