Computers Made Plain Cable Modems Are About To Get Cheaper
Investor's Business Daily
Fri, Dec 19 1997
The idea of surfing the Web via cable is just a distant, expensive dream to you.
But a handful of companies want to bring your vision closer to reality and within
your budget. Their plan: New technology they hope will turn the modem industry on
its ear.
Companies such as 3Com Corp. in Santa Clara, Calif., are making new
cable modems they hope will be part of tomorrow's computers. 3Com
officials believe these new, cheaper types of cable modems will
revolutionize Web access.
"It's the first time consumers can have higher speed at home than at their offices,"
said Rick Edson, 3Com's senior vice president of new business initiatives.
"It's just like the arrival of (electric) power in the 1880s."
That may be a bit strong, but the new modems should make it easier for both
consumers and cable companies to upgrade to the new technology. That's
something to watch for in future years when you're grumbling about a Web page
taking too long to download.
Cable modems are not new, although this type is. Like the few cable modems now
in use, they download pages from an Internet service provider at 700 times the
speed of today's fastest phone-based modems.
But with these new cable modems, the information you send back to the service
travels along your phone line at a much-slower rate. Developers of the new devices
say all you really need is to get to Web pages a lot faster.
These modems follow a set of specifications developed by
the Multimedia Cable Network Systems partners, a consortium of
cable providers. The new standard - called the Data Over Cable
Service Interface Specification, or DOCSIS - could make
cable Internet service more popular.
For one, modem producers now can develop products they know will be compatible
with network equipment.
And you could save some money. 3Com's cable modems, for example,
cost $200 to $250. That compares with $400 for current cable modems
and $168 for phone-based modems.
If you're brave or tech savvy, you also could bypass the installation fees of $95 or
more that some cable companies now charge. You could install the device yourself,
much as you would any internal modem.
Among the companies building the new DOCSIS modems are 3Com and
South Korea's Samsung Group. Rockwell International
Corp. in Seal Beach, Calif., is developing chip architecture
for the modems.
3Com is the first to market with the devices. The company has a new
line that includes two cable modems. One is called VSP, which works
with your current modem and allows you to download information at up
to 38 megabits a second. Today's fastest phone modems run at
56 kilobits, or 1/700th of the VSP speed. The higher-end model,
the VSP Plus, has an analog modem built in.
There are some caveats. One is that the high-speed access is only one-way, to your
home or office. In other words, you're paying half the price, but you're also getting
only half the device.
"(It) addresses some of the barriers -the lack of standards and the lack of
lower-cost products that are installed in people's PCs. But the transition is not as
easy as (its backers) make it out to be," said Lee Doyle, an analyst at International
Data Corp. in Framingham, Mass.
It's unlikely a significant number of consumers will access the
Internet via cable lines soon, Doyle says. There still are plenty of
hurdles for the cable companies.
In five years, about 5% of home Web surfers will access the Net via
cable, says Doyle. That's up from less than 1% today, he adds.
The change will be slow because few of the cable lines in this country can support
two-way communications, which consumers prefer, Doyle says. Cable companies
will have to upgrade the rest, and that may only be cost-effective in densely
populated neighborhoods.
Other equipment, such as network switches, is also necessary. Finally, cable
providers will need to retrain their service personnel.
"Ninety-five percent of consumers are using analog modems and phone lines to get
on the Internet," Doyle said. "In order for cable companies to
compete with that, they'll need to spend billions of dollars."
3Com points out its cable modems don't require cable companies to spend big
bucks right away. They receive information via cable lines, but they send
information via phone lines. That means they work fine with existing cable.
Today, cable operators rent modems to subscribers and incur the cost of operating
the machines themselves. The new devices should save cable providers money and
make offering Internet services more palatable to them.
3Com acknowledges users eventually will demand high-speed, two-way
communications. It is readying two-way cable modems. But in the meantime,
modems such as the VSP may prove useful, company officials say.
(Copyright Investor's Business Daily, Inc. 1997.
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