Modem Guy
3Com in the digital catbird seat
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With phone and computer firms massing this week to endorse standards for warp-speed service over phone lines, the Telephone Guy will soon vie with the Cable Guy to be your escort to the stars.
Before the Tuesday opening of the ComNet trade show in Washington, phone companies like Ameritech and GTE and computer biggies like Microsoft, Intel and Compaq Computer are expected to announce a standard for Digital Subscriber Line service over telephone lines with a transmission speed rivaling that of Internet service over cable-TV lines now offered by the At Home Network and its cable-firm partners.
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Copper phone wires reach more customers than cable: There are nearly 200 million phone lines in the U.S. and more than triple that worldwide, including businesses cable doesn't touch. So 3Com couldn't be happier about the DSL standard. Like the Internet on cable, DSL on phone lines is made possible by modems. And 3Com has roughly half the worldwide modem market, with its US Robotics brand products ("The Future Is 3Com," December 1, 1997).
3Com's CEO, Eric Benhamou, will be ComNet's first keynote speaker, and his modem-mongers will be close by. "You'll see some very interesting announcements from us," says Rick Edson, senior vice president for new business initiatives at 3Com. The company is already on its second generation of DSL modems, with phone companies field-testing them here and abroad.
This week's standards agreement overcomes one problem that was stalling DSL's deployment: Too many proposed alternative standards, making mass-produced modems impossible. "Now that we're solving this Baskin Robbins approach to DSL standards," says Edson, proponents can concentrate on attacking other barriers.
For one, phone companies will need to deploy DSL -- modems and network gear across their plants -- and historically, says Edson, telcos have renovated only about 7% of their plant each year. For another, DSL service, at rumored introductory rates of $50 a month, would cannibalize demand for a service called "T-1" that's nicely profitable today for phone companies at $600 a month. This conflict is a big reason why At Home Network, the $40-a-month cable-modem service, isn't fearing for its life just yet.
DSL is chugging along, though. Now available in pilot programs from carriers like USWest Communications are DSL Internet access and telecommuter networking that are similar to -- if more expensive than -- the cable modem service now used by about 100,000 cable subscribers. Other potential DSL offerings include enhanced home shopping and video-on-demand with simulated VCR controls. Unlike the costly phone service offered today called "ISDN," DSL won't require customers to lease a second phone line to make plain old phone calls.
Despite DSL's fat bandwidth, current modem technologies aren't quite powerful enough to allow transmission of live TV or High Definition TV over copper phone lines. Video-conferencing may also prove a challenge because of the split-second delays introduced by error-correction coding.
But this week's agreement to unite behind a DSL standard shows the eagerness of phone firms to compete with cable firms for the potential annuities from selling rapid communications services. As the competition heats up, maybe we'll even be able to afford them.
-Bill Alpert |
