According to In-Stat, Need for Two-Way and IP Boosts Market for Digital Equipment in Cable Headends.

Business Editors & High-Tech Writers

SCOTTSDALE, Ariz.--(BUSINESS WIRE)--Nov. 19, 2001

As existing cable infrastructure is re-built to increase the bandwidth and provide the two-way communications needed to support new services such as two-way voice telephony, high-speed Internet access and Video-On-Demand (VOD), the number of cable headends converting to digital acquisition will experience a Compound Annual Growth Rate (CAGR) of 35.8% worldwide over the next five years.

Cahners In-Stat Group (http://www.instat.com) reports that the worldwide dollar value of digital equipment intended for use in digital cable TV headends and the rest of the delivery plants will top $286 million during 2001, and will rapidly expand to more than $743 million during 2005.

"The additional capabilities that a digital cable system offers customers can present providers with a myriad of opportunities," said Gerry Kaufhold, a principal analyst with the high-tech market research firm.

"However, in order to provision these services, existing infrastructure must be revamped. The top eight Multiple System Owners (MSOs) have embraced two-way and IP (Internet Protocol), but many smaller cable operators, especially those in rural areas, will not be able to justify the investment."

In North America, In-Stat estimates that the market for equipment to build out two-way digital cable systems for consumers will peak during 2003, and by 2004, the cable industry will need to focus on business markets to find continuous long-term growth.

In-Stat has also found that:

-- Although North America will hold the lion's share of the market through
2005, that share will dwindle, accounting for about 71.7% of the total market
during 2001, but declining to just over 50% during 2005.

-- Western Europe will be the main market outside North America until 2004.
During 2005, the Asia Pacific region will become the No. 2 market. There will
be a few specific opportunities among countries in the Rest of the World (ROW)
segment as well.

The report, "Digital Cable Headends Migrate To 2-Way, Add Internet Protocol" (No. MB0110DC), provides Cahners In-Stat Group's discussion and conclusions about the market for digital equipment for digital cable TV headends and infrastructure.

To purchase this report, or for more information, please visit http://www.instat.com/catalog/cat-dt.htm or contact Matthew Woods at 617/630-2139; [e-mail]. The report price is $2,995.

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.

In-Stat is a unit of Cahners Business Information (www.cahners.com), a leading provider of critical information and marketing solutions to business professionals and a member of the Reed Elsevier plc group.