Cogeco 2014 Annual Report Download - page 14

MD&A COGECO CABLE INC. 2014 13
To better serve its customers, Peer 1 Hosting continued the consolidation of its legacy data centres infrastructure into newer facilities and migrate
the Goswell Road and Croydon customers into the Portsmouth, United Kingdom data centre and started the migration of Yonge Street customers
into the Front Street and Pullman Court facilities in Toronto, Canada. Also, to accommodate migrations and meet ongoing customer demand,
Peer 1 Hosting expanded its data centre facilities in Portsmouth and Pullman.
Focus in fiscal 2015
We will continue to focus on the enhancement of our suite of services with the planned release of Cogeco Data Services' next generation cloud
services and additional managed IT and connectivity services. In addition, Peer 1 Hosting will continue its ongoing improvements to its e-commerce
and cloud offerings based on findings of recent market and customer research.
Peer 1 Hosting will continue the consolidation and standardization of its data centres infrastructure in fiscal 2015. Cogeco Data Services will
complete the construction of pods 2, 3 and 4 at its Barrie data centre and continue to expand its data centre footprint with the construction of a
new data centre in Montréal, Québec. The first pod of the Montréal data centre is scheduled for completion in the Spring of fiscal 2015. The new
facility, built to be in line with US Tier 3 standards (as outlined by the Uptime Institute), will bring the footprint of Cogeco Data Services data centres
to over 200,000 square feet. In addition, Cogeco Data Services will continue upgrading its core network to enable new services and capabilities.
IMPROVING THE NETWORKS
We operate in an industry characterized by rapid technological innovation which will continue to require substantial capital for the upgrade,
expansion and maintenance of our network and the launch and expansion of new or additional services.
CANADIAN CABLE SERVICES SEGMENT
Progress in fiscal 2014
We have recently completed significant capital expenditures in our Canadian cable services segment, having invested $214.4 million during the
fiscal year ended August 31, 2014. Our capital expenditures were designed mainly to increase our scalable infrastructure, to extend and improve
network capacity and to deploy advanced technologies. In particular, as a result of our capital investment:
• Switched Digital Video ("SDV") technology implementation has been essentially completed for further bandwidth recovery, to satisfy
the greater demand for channels in Ontario. The SDV technology has been rolled-out to almost all households in this Province.
• DOCSIS 3.0, which allows us to provide faster Internet speeds with packages currently up to 120 Mbps in Canada, is available to 94%
of homes passed; and
• We deployed state of the art public WiFi access points in the “Golden Horseshoe” area in Ontario and in Magog in Québec.
Focus in fiscal 2015
We will develop our WiFi offering through the introduction of new hotspots in other key Golden Horseshoe locations, followed later by certain
Québec communities, seeing the interest for our customers grow with regards to using the Internet outside their homes. As we believe the ramp-
up in our public WiFi access point deployment in Canada will make our HSI service more attractive, additional investment in back-office system
for the WiFi Service will enable future business products.
The SDV technology, already implemented in Ontario, will be extended to the Québec region starting in 2015 over the next two fiscal years. This
technology enables bandwidth savings by distributing dynamically only viewed channels.
AMERICAN CABLE SERVICES SEGMENT
Progress in fiscal 2014
During the fiscal year ended August 31, 2014, Atlantic Broadband invested $71.7 million to increase the effective capacity of its networks, enhance
the capabilities of some of its underserved markets, to strategically extend and interconnect its network where appropriate and launch its TiVo
video platform.
Atlantic Broadband completed in fiscal 2014 the conversion of all its analogue video services to digital in three areas representing over 10% of
its footprint: Aiken, South Carolina; Clearfield and Shippenville, Pennsylvania. This conversion has provided capacity that enable Atlantic
Broadband to launch over 100 HD channels in these systems and to increase our Internet speeds today and into the future.
Moreover, we upgraded our HSI platforms to enable the launch of DOCSIS 3.0 class speeds (up to 75 Mbps) in parts of our Pennsylvania operation
including Bradford, Warren, and Clearfield as well as in Salamanca, New York, increasing our coverage of DOCSIS 3.0 to 94% of homes passed.
We also rebuilt our West Virginia network to enable the launch of HSI and Telephony services and provide customers in this area a choice in their
communications provider for the first time ever.
As a pilot for future architectures, we completed our first Fibre-to-the-Premises network extension in a small portion of the Miami Beach area
known as Indian Creek Village. Utilizing Radio Frequency over Glass ("RFoG") technology combined with a Metro-Ethernet overlay, we are
delivering symmetrical 1 Gigabit Internet speeds, our full complement of 350 TV channels, multi-room TiVo service, and multi-line Telephony
services to this exclusive community.
Through a multiyear headend consolidation initiative project we eliminated 10 of the 27 we had a few years ago. This initiative has enabled us
to complete our ring architecture in central Pennsylvania, and through newly negotiated fibre Indefeasible Rights to Use ("IRU") to establish
peering points in several key markets including Ashburn, Virginia; Pittsburgh and Philadelphia, Pennsylvania; Buffalo, New York and Miami,