1. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 1 Switched Digital Video (SDV) Overview Robert Kidd Subscriber Network and Applications Engineering

2. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 2 Switched Digital Video Business Drivers and Viewership Dynamics

3. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 3 Why Switched Digital Video?  Powerful bandwidth management tool Decouples bandwidth from offered content  Works on existing MPEG-based set-tops Fully supported on existing S-A set-tops  Enables new programming offerings Premium, ethnic tiers – enables “the long tail”  Transparent to consumers More choice - no change in viewing experience  Improves visibility to consumer demand Provides detailed viewership data Can be used to enhance targeted advertising  A key component of Next Generation Networks

4. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 4 HDTV is penetrating the mainstream market  HD programming is expanding 14-18 HD channels in most major markets today DirecTV by 2007 will offer 150 national channels in HD and 1,500 local broadcasts Dish adding 7 new HD channels on February 1, totaling 25 HD channels More niche networks launching HD (MTV just launched; HGTV and Food Network launching HD programming by mid’06)  Consumer purchase of HD televisions on the rise Roughly 40% of U.S. homes to have 1 or more HD televisions by end of 2007 Prices of HDTV sets continue to decline HH Income of HDTV owners Source: Forrester's Consumer Technographics ™ Q2 2005 North American Survey

5. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 5 Example: DirecTV has suggested that “niche” content is helping to drive their growth  “…our PARA TODOS product added 120,000 net subscribers in the quarter…”  “We now have 700,000 subs in the PARA TODOS package, that is double where we were at the beginning of ’04.” Source: May 2, 2005 DTV – Q1 2005 The DirecTV Group, Inc. Earnings Conference Call

6. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 6 Another niche experience: Dish Networks now offers extensive international programming options African ABN America - $14.99/mo. Armenian Armenia TV - $14.99/mo. Arabic 15 channels - $39.99/mo. Al Jazeera Kuwait TV Chinese 17 channels - $29.99/mo. Farsi 3 channels - $32.99/mo. French 3A Telesud - $14.99/mo. German Polish 1 channel - $14.99/mo. Greek 6 channels - $36.99/mo. Israeli Israeli Network - $19.99/mo. Italian 2 channels - $12.99/mo. Japanese TV Japan - $25.00/mo. Korean 4 channels - $36.99/mo. 4 channels - $38.99/mo. PortugueseRussian South Asian Tagalog Urdu TV Globo - $19.99/mo.2 channels - $24.99/mo. 6 channels - $49.99/mo. 1 channel - $14.99/mo. 3 channels - $34.99/mo. The high price of these offerings demonstrates the value to niche consumers.

7. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 7 Switched Digital Video Switched Channels Everyone could get their own special channels: increased appeal of overall package to ALL subscribers Broadcast Channels Next 10 5-10 Viewers Next 30 1-5 Viewers Next 200+ < 1Viewer Typical Viewership at a node Top 4 >30 Viewers Audience Broadcast Channels Current Analog & Digital Broadcast Approach Only the most popular channels are offered due to capacity constraints Unused Capacity SDV Drives a Paradigm Shift in Bandwidth Management “The Long Tail” Within any service group, NOT every channel is watched all the time

8. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 8 Switched Digital Video Will Enable Cable Sites to Deliver More Content Than Ever Before, While Using Existing Hardware HeadendHub Headend Hub Today’s Broadcast System Our Switched Digital Video (SDV) System Service Group All Programs Are Broadcast to All Subscribers All the Time Programs Are Transmitted to a Service Group Only When a Subscriber in That Group Is Actively Watching Them SDV Sends Programs to Subscribers Only in Areas Where Programs Are Being Requested in Real-Time

9. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 9 Potential Bandwidth Gains with SDV Traditional Broadcast with Statistical Mux Switched Digital Video 200 Programs Offered 17 QAMs HFC Bandwidth Required 300 Programs Offered 25 QAMs HFC Bandwidth Required 200 Programs Offered 6-8 QAMs HFC Bandwidth Required 300+ Programs Offered n QAMs HFC Bandwidth Required Bandwidth scales as number of channels offered Immediate bandwidth savings HFC bandwidth scales based on viewership HFC bandwidth required is independent of number of offered channels MSOs can save bandwidth by delivering programs based on viewership

10. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 10 Viewership Ranking

11. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 11 Peak Usage Over Time - Saturday Service Group GC10 - 1108 Tuner

12. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 12 Peak Usage vs. Service Group Size

13. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 13 SDV Gain vs. Offered Programs

14. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 14 Switched Digital Video An Open Architecture

15. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 15 SA Switched Digital Video Status  History TWC re-engaged on IP-based approach – late ‘04 TWC Issued RFP for IP-based architecture - in April ‘05 Cross-vendor “tweaks” to spec completed - April-July ‘05 Specifications and open protocols published – July ’05 Functional end-to-end system in S-A lab – October ’05  Status SA first to market with the TWC “Phase II” SDV solution TWC Albany – Multiple hubs provisioned, deploy to friendlies this week TWC Oceanic – Design complete, switching on test hub in the headend TWC Rochester – Design in process SR 4.2 beta code installed at multiple TW sites and at other MSOs SDV Production Installations and Beta Trials also underway at other MSOs

16. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 16 Bulk Encryptor HFC Network Open IP Architecture for Switched Digital Video Settop with SDV Client Video Content IP Network Mini Carousel Control IP Network Video Sources Channel Change Message Session Binding Groomed Video IGMP Join Out-of-Band Channel In-Band Channel Server Interactive Session Request Encrypted Multicast Video Staging Processor SDV Server Master SRM Edge QAM QPSK Content Sources SDV Manager Management & Provisioning Shell Session Setup Open Interface Specification Video Content Management All interfaces are open and published Separates server from switch Based on IP Multicast Separates switch from QAM VOD Pump Enables QAM Sharing

17. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 17 SDV Equipment Typical Rack Elevation

18. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 18 2) Reserve 37 for VOD 2) Join multicast for SDV ch8 DNCS w/ App-Independent Session and Resource Manager (SRM) GQAM VOD Pump 0) Channel change to SDV ch8 (HD) 3) SDV ch8 (HD) -3) Give me 36x 625kb/s sessions -6) set up CBR SPTS IP unicasts to Netcrypt -1) Take sessionIDs 1-36 on GQAM X -2) Reserve sessionIDs 1-36 “shell sessions” for SDV 1) Use sessID 12 for HD-SDV ch8 incl: actual bit rate and multicast addresses 4) SDV ch8 1) Buy VOD “Movie” 3) Send VOD “Movie” to GQAM X 4) “Movie” 5) “Movie” 6) “Movie” ServerInteractiveSessRequest/response “Movie” 37 Headend SDV / VOD Session Setup Messages DCM Staging Processor 2) Mini Carousel SDV ch8 (HD) 12 SDV Manager -4) Provision SDV Servers -5) set up multicast CF sessions on Netcrypt -5) DNCS sends SourceIDs, multicast addresses, bit rates to SDV Manager 2) Tune to GQAM X DNCS 4.2 Master SRM SDV Manager SDV Server Netcrypt DCM Staging Processor Hub

19. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 19 QAM Sharing  Better utilization of QAM resources  Lower probability of blocking with less combined overhead  Better network resiliency with larger QAM pool  Planning by aggregate demand  No stranded capital Available Capacity For BW Request Lower Blocking Probability Improved Service Availability X

20. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 20 QAM Carriers Required With and Without QAM Sharing

21. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 21 SDV Network Redundancy  N:1 Server Backup Up to 8 servers backed up by a single server for high availability and hitless upgrades  IGMPv3 Source Specific Multicast (SSM) Redundancy of network attached devices (Netcrypt, encoders, and DCM)  Mini-carousel Provides in-band tuning information in cases where out-of- band communication fails

22. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 22 1:n Redundancy SDV Server Redundancy State Data State Data 1 State Data 2 State Data n Database Synchronization Protocol - Database transfer - Change of state indications - Heartbeat.... Primary Server 1 Primary Server 2 Primary Server n Standby Server

23. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 23 Source Redundancy Using IGMPv3 Source Specific Multicast (SSM) GQAM Router Source 1 Source 2 Source 1 Multicast X Source 2 Multicast X Source 1 Multicast X Program X Pgm X OK Pgm Check GQAM Router Source 1 Source 2 Multicast X Pgm X BAD GQAM Router Source 1 Source 2 Multicast X Source 2 Multicast X Program X Pgm X OK Join Source 2 for Program X Pgm Check 1) Nominal 3) Recovery 2) Fault

24. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 24 Mini Carousel  SDV Server: Updates mini carousel dynamically Sends mini carousel to SDV client over IP multicast Multicasts mini carousel update even if reverse path is impaired or congested  SDV Client: Checks mini carousel to see if channel is available Alternative, fast tuning mechanism if channel is already available on switched tier Ability to tune available channel even if reverse path is impaired or congested Mini Carousel provides resiliency in the event of a reverse path outage or congestion

25. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 25 SDV Session Resiliency  Bandwidth Reservation Prevents fragmentation of bandwidth across multiple carriers  Bandwidth Reclamation of Idle Sessions User-defined timeouts for marking available sessions  QAM Re-assignment Sessions on failed QAMs will be re-assigned based on active viewers

26. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 26 Session and Resource Manager (SRM) must manage QAM bandwidth intelligently to reserve enough contiguous BW for HD In the example below*, all QAMs in the service group are filled to a point where there is more than enough total bandwidth available for the requested HD stream, but no single QAM has enough contiguous bandwidth. SD HD QAM 1 QAM 2 QAM 3 QAM 4 Requested Streams: HD stream Blocked! Bandwidth available for SD stream Narrowcast Modulators feeding one Service Group * Note: Any bandwidth can be requested. Standard Definition (SD) and High Definition (HD) are shown in the example only for simplicity. Bandwidth Management and Resource Reservation

27. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 27 Bandwidth Management and Resource Reservation QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4  As SRM begins to fill QAMs in a Service Group, it load balances among the QAMs…  After all QAMs are filled to the point where the largest bandwidth (e.g. HD) would just fit, it then begins to fill QAMs one by one. It attempts to always maintain available contiguous bandwidth for the biggest streams.  It fills QAM 1 first... …then QAM 2… …and so on.  As sessions come and go…  if load is high, it will fill the most full QAMs in order to preserve contiguous bandwidth. QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4 QAM 1 QAM 2 QAM 3QAM 4  If load is light, it will revert to balancing the load.

28. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 28 QAM Re-Assignment SDV Server is capable of re-mapping SDV sessions from a failed GQAM to an active GQAM feeding the same service group. QAMs are load-balanced in light load conditions to minimize impact of outage Availability improves with additional VOD/SDV carriers allocated Priority is given to the streams with the most users

29. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 29 S-A Architecture Highlights S-A / CiscoBenefits Phase 2 Architecture Tested Open architecture based on IP Multicast protocols and open interfaces to the QAM, Server, SDV Manager, and Client QAM Sharing SDV and VOD sessions can share bandwidth, requiring less RF spectrum and equipment Integrated Client Faster boot times, rapid Mini-carousel auto- discovery, and full visibility to all channel changes Bulk Encryption Netcrypt support in DNCS 4.2 eliminates need to modulate/demodulate IGMPv3 SSM Provides standards-based network and source redundancy Multi-CBR and HD support Flexibility to optimize bandwidth utilization and ability to offer new HD content on SDV tier

30. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 30 S-A Feature Highlights S-A / CiscoBenefits Single Management System SDV Manager provisions SDV servers and Netcrypt from DNCS 4.2 Server Redundancy N:1 Auto Backup minimizes down-time during failure or maintenance SDV Session Re-assignment Provides session resiliency in event of a QAM failure GQAM support Leverage installed GQAMs which are Phase 2 compatible with no need to upgrade hardware Integrated VOD Encryption Netcrypt not required in shared VOD/SDV environment since session based encryption is accomplished in the GQAM

31. © 2006 Cisco Systems, Inc. All rights reserved.Cisco ConfidentialCisco Days SDV 31