This paper describes the current cable environment and what demands it has on development of a cable-friendly AVC video coding stream. It considers what the further restrictions on AVC are for recreating the same services already provided by MPEG-2 plus coexistence in the same network with MPEG-2 video streams and other digital services. The paper also looks at what are the requirements for multiplexing, random access to support existing broadcast services, and how this affects the coding design. Furthermore it looks at additional emerging needs to address services like Personal Video Recorders (PVRs), Videoon- Demand (VOD), and Digital Program Insertion (DPI) and how this can constrain the design on the video stream and the video coding layer. This paper concludes by saying it is not enough to just have a highly efficient video coding standard developed, the cable environment (or any application environment) imposes its own set of demands that trades off the advanced video coding design and some compression efficiency for expected viewer experience.