Price is key to fast Net links
Strategy: Big 3 in PCs want phone firms to offer rock-bottom monthly fee.
BY JON HEALEY
AND TOM QUINLAN
Mercury News Staff Writer
As they construct a plan to turbocharge Internet connections, Microsoft Corp.,
Intel Corp. and Compaq Computer Corp. are focusing on the single issue crucial
to the effort's success -- the price.
The computer industry companies can deliver only a portion of the needed
technology, the high-speed modems. To realize the rest of their package, they
are seeking to convince major telephone companies to offer ultra-fast Internet
connections at a rock-bottom monthly fee.
If it succeeds, their effort would slash the cost of the emerging ''digital
subscriber line'' (DSL) service by at least 75 percent in the Bay Area, into the
neighborhood of $40 per month.
And if that price proves enticing, the computer industry plan could transform
the business of Internet service. A wholesale shift of customers to the phone
companies' Internet services probably would spell doom for many small- and
mid-sized competitors.
SL technology uses an ordinary copper phone line to transmit digital packets
of data at high speeds to the Internet or corporate computer network. Once a
connection is established, it remains open -- the user never needs to dial in.
Meanwhile, the phone line can still be used to make calls because the digital
data does not interfere with the dial tone.
Microsoft, Intel and Compaq have been talking not only to Pac Bell's parent,
SBC Communications, but also to the other four regional Bell telephone
companies and GTE Corp. A main topic has been developing a standard for a
slower but more flexible version of DSL, which would allow consumers to buy
computers and modems that work with any of the phone companies' networks.
Sources said the three computer companies have advocated charging
consumers as little as $40 a month for DSL-based Internet access. That's at
least twice what consumers typically pay for conventional-speed access --
but it's about the same price charged for high-speed access via cable TV
modems, which are expected to be the major competitor to DSL. |
