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Technology Stocks : USRX

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To: damniseedemons who wrote ()5/13/1997 9:53:00 PM
From: Glenn D. Rudolph   of 18024
 
LONDON, ENGLAND, 1997 MAY 12 (NB) -- By Steve Gold. Last November, en- route
to the Comdex Fall computer show in Las Vegas, this writer upset a few
people at US Robotics's [NASDAQ:USRX] headquarters in Skokie, Illinois,
because of my persistent questioning about field tests that USR had
undertaken in the US and Europe for its then alpha test x2 56,000 bits per
second (bps) modem technology.

The Q&A session with the USR technical gurus ended with the PR person
giving me the "evil eye," over my questions. I can't say I blame him,
but the chickens, as they say in England, are about to start to coming
home to roost.

US Robotics claimed that it had undertaken extensive tests on its 56k
modems, operating them across telco lines in the US and through major
telcos in Europe, including British Telecom (BT) in the UK.

I've said it before, and I'll say it again -- no modem vendor has yet
carried out any tests on 56k modems on smaller telco lines, including
the several million cable telephone subscribers in the UK and Europe.

According to Lauren Weiner, sales and marketing guru with Zen Internet
in the UK, and a US citizen who admits to having been around to access
bulletin board systems (BBSs) in the 1970s, the modem vendors may have
a problem with these types of users, especially in the UK, "where many
lines are old."

"Back in the US, most lines are relatively new. Here in the UK, while
many of the exchanges are new, a lot of the lines are very old. Their
performance is unproven with 56k modem technology. Right now we're
having problems with subscribers who can't get their modems to support
33,600 bps technology to its fullest extent. When 56k arrives, we
expect there to be similar problems," he noted.

Fortunately for phone users with "iffy" lines, Weiner notes that there
is a solution, since the telco can be requested to "turn up the gain"
on the line. This will enhance the signal to noise performance of the
line, but the downside is that the line will not be optimized for
voice calls. Too bad if, like many home users, you have the modem
share the line with voice calls.

It's good to come across someone else with a healthy attitude towards
this 56k modem technology, and not someone who is apparently
brainwashed into believing the sales and marketing hype that surrounds
56k modems. Too many people are going around at the moment claiming
that 56k is as much a breakthrough as 28,800 bps modems were when they
arrived to replace 14,400 bps units.

I don't think so. For one thing, the modem kit has to be installed at
the distant end of the link and, because of the asymmetric way in
which data flows (56,000/33.600 bps), the x2 and k56flex modem
technology in best suited to Internet usage, rather than general
online access.

CompuServe US and Europe have only just upgraded their dial-up ports
to support 33,600 bps -- it could be some time before the online giant
supports 56k on a wide scale, even if the service is testing Cisco 56k
kit at the moment.

Don't get me wrong. Many modem users will upgrade to, and enjoy, 56k
modem usage. I just think there will be significant numbers of users
in country areas, or on cable exchanges, who won't be able to whizz
their data along at 56,000 bps. And those users are the ones that
modem vendors are going to have to answer to.

The Online Eye is a weekly report compiled by Newsbytes' UK and
European bureau chief Steve Gold. Comments, including ICBMs from ISPs,
online services and modem manufacturers, are welcome to
steve_gold@newsbytes.com .
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