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Non-Tech : Amati investors
AMTX 1.550+4.0%Dec 11 3:59 PM EST

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To: jeff w day who wrote (6400)11/30/1996 6:22:00 PM
From: JW@KSC   of 31386
 
The State of ADSL #2

Copper load of this

Another day, another link in the digital chain. So what makes
ADSL so special? Geof Wheelwright admires its solid copper bottom

Everybody wants to offer you a fast connection to the Internet - for
high-speed Web browsing, for demanding applications such as
video-conferencing or for use of heavy-duty Java-based applications.
But consumers are reluctant to pay a huge premium for such
performance.

Enter a technology known as asymmetric digital subscriber line
(ADSL), which promises access speeds that go beyond those
promised by both ISDN and cable modems hooked up to cable
television lines.

ADSL is designed to work over existing telephone lines and so could
deliver this kind of performance without the high cost associated with
either of the other access solutions. Both ISDN and cable modems
require considerable infrastructure investment by telephone and cable
TV companies.

According to the ADSL Forum - a US and European industry group
established in 1994 to promote the ADSL standard - telcos around the
world are beginning to recognise the immense value of their existing
copper phone lines. This means they can begin to offer high-speed
access quickly, without spending lots of money on infrastructure.

The group describes ADSL as an asymmetric modem capable of
transmitting films, television programmes and high-speed data over
long copper links.

It claims the technology has proved itself in the field and is now ready for wide-scale deployment. It also says that VDSL - a turbo-charged modem that moved into field trials this year - can transmit high-definition television (HDTV), as well as many live TV channels and high-speed data over shorter lines.

In a report published on the Web, the forum says: 'The two make an
amazing combination, offering rates from 1.5Mbps to 52Mbps,
depending on line length, over the very same wires used for plain old
telephone service (Pots). Indeed, ADSL and VDSL share the line with
Pots, enabling telephones, fax machines, PCs and TVs to connect to
remote services over a single line at the same time.'

Focusing first on ADSL, the forum promotes the concept of copper
access for broadband services and develops practical solutions for
system problems engendered by ADSL and VDSL networks. It pays
particular attention to the near term, when it says ADSL will be
deployed along a migration path toward ATM, but before ATM
becomes widely distributed.

Copper lines can now be used for video on demand, Internet access,
remote Lan access and multimedia access. Consequently, solutions
must be developed for wiring, premises distribution, terminal
interfacing, link protocols and network management - all in
conjunction with evolving network paradigms.

'ADSL will play a crucial role over the next 20 years as telcos enter
new markets for delivering information in video and multimedia
formats,' says the report. 'By bringing movies, television, video
catalogues, remote CD-Roms, corporate Lans, and the Internet into
homes and small businesses soon, ADSL will make these markets
viable for telephone companies and application suppliers alike.'

According to the forum, ADSL depends on advanced digital signal
processing and creative algorithms to squeeze so much information
through twisted-pair telephone lines. It says many advances have been
required in transformers, analogue filters and A/D converters.

'Long telephone lines may attenuate signals at 1MHz - the outer edge
of the band used by ADSL - by as much as 90dB, forcing analogue
sections of ADSL modems to work very hard to realise large dynamic
ranges, separate channels and maintain low noise figures,' says the
group.

'On the outside, ADSL looks simple - transparent synchronous data
pipes at various data rates over ordinary telephone lines. On the
inside, where all the transistors work, there is a miracle of modern
technology.'

The miracle is this. To create multiple channels, ADSL modems
divide the available bandwidth of a phone line in one of two ways:
frequency division multiplexing (FDM) or echo cancellation. FDM
assigns one band for upstream data and another band for downstream
data. The downstream path is then divided by time division
multiplexing into one or more high-speed channels and one or more
low-speed channels. The upstream path is also multiplexed into
corresponding low-speed channels.

Echo cancellation assigns the upstream band to overlap the
downstream, and separates the two by means of local echo
cancellation, a technique well know in V.32 and V.34 modems. Echo
cancellation also uses bandwidth more efficiently, but at the expense
of complexity and cost. With either technique, ADSL splits off a
4KHz region for Pots at the DC end of the band.

An ADSL modem organizes the aggregate data stream created by
multiplexing downstream channels, duplex channels and maintenance
channels together into blocks, and attaches an error correction code to
each block. The receiver then corrects errors that occur during
transmission up to the limits implied by the code and the block length.
The unit may, at the user's option, also create superblocks by
interleaving data within subblocks; this allows the receiver to correct
any combination of errors in a specific span of bits.

Initial trials indicate that the correction used in ADSL will create
effective error rates suitable for Mpeg2 and other digital video
compression schemes.

Supporters of ADSL technology include Motorola Semiconductor,
Ericsson Austria, AT&T's recently sold Paradyne division and Alcatel
Bell. The AT&T Paradyne work is particularly interesting.

In June of this year, AT&T Paradyne released an enhanced version of
its ADSL modem technology that it says can achieve transmission
speeds of over 7Mbps. At the time, the company predicted products
based on the enhanced technology would enable SPs to offer multiple
channels of high-quality video for broadcast - as well as
video-on-demand television and data services over standard phone
lines - years ahead of the cable TV companies.

Paradyne says this is a commercially viable ADSL transceiver
technology that operates at broadband transmission rates, previously
unavailable, with low-cost, low-power technology. Earlier versions of
ADSL transceivers were only able to transmit data and video to the
user (downstream) at 2Mbps and 64Kbps from the user to the
network (upstream). The firm claims its enhanced Globespan ADSL
technology will dramatically increase downstream rates to more than
7Mbps and upstream rates to 640Kbps.

'Service providers have been looking for practical implmentations of
ADSL products with transmission rates of 6Mbps or more for quite
some time,' says Gabe Torok, general manager of Paradyne's
advanced transmission technology unit.

Paradyne is promising that its Globespan 7Mbps ADSL technology
will enable SPs to offer new video and data services cost-effectively
over existing phone lines, without interrupting standard telephone
service.

ADSL-based products are expected to support interactive TV services,
such as video on demand and distance learning, real-time broadcast of
news, sports and weather, video teleconferencing, standard ISDN
basic rate interface services, Internet access and remote connections
to corporate networks and intranets.

'By design, ADSL enables a standard phone line to be used
simultaneously for a phone call and for video or data services,' says
Clete Gardenhour, director of business development for Paradyne's
Advanced Transmission Technology Unit. 'By increasing the
transmission capacity of that line with Globespan, we've just doubled,
tripled, or even quadrupled its value for consumers.'

He insists there will be added value for those who sell this technology.

'Imagine Dad on a business call while the youngest child watches a
favorite video on demand educational programme, and Mom is on a
video teleconference call with friends while the teenagers are doing
homework assignments using the Internet - all using the same phone
line simultaneously. The possibilities are endless, and we expect to see a variety of exciting new applications created by innovative service and content providers in the near future.'

But prices are harder to predict. Paradyne says consumer pricing for
ADSL products and services will be established by equipment
manufacturers and service providers as they begin offering new
high-bandwidth services.

Telecoms giant Motorola is also moving into the ADSL market with
lots of partnership agreements. In April, for example, Motorola and
Amati Communications announced a strategic alliance to deliver
'cost-effective, standards-based ADSL solutions for interactive
multimedia via plain old telephone service lines'.

Amati has licensed its discrete multitone (DMT) line code technology
to Motorola. Motorola will couple DMT with its mixed-signal expertise
and its 0.5 micron CMOS technology to design an integrated
single-chip solution that the company says will drive the cost of an
ADSL line down to several hundred dollars.

Until now, only 1.5/2Mbps ADSL systems have been available.
Motorola and Amati say this alliance will capitalise on the expertise of
both firms to develop ADSL technology capable of delivering up to
6Mbps downstream and up to 640Kbps bi-directionally.

Motorola is pledging to introduce its standard compliant single-chip
ADSL solution to the market later this year. 'Motorola's goal is to
deliver a single chip for less than $90 in production volumes,' says
Debbie Sallee, communications strategic planner for Motorola's Mos
Digital-Analogue IC division. 'This will allow our customers to meet
the industry's targeted cost per line for interactive multimedia
services.'

Amati is not the only partner Motorola has signed up in the battle to
move to ADSL. Illinois-based Westell announced in July that it was
entering into an alliance with Motorola for the development of
modems that use ADSL.

'The near-term societal impact of this technology will be phenomenal,'
says J Nelson, Westell president of US operations. 'The
communications landscape will look radically different in just a few
years, which will be of great benefit to everyone.'

Westell, which claims to have developed the first ADSL modem and
have the leading market share worldwide, will incorporate Motorola's
standards-based DMT transceiver chip, called Copper Gold, in its
modems and systems.

In addition, the two companies have plans to collaborate on product
design and development of future generation, ADSL-based
semiconductors, modems and systems.

These integrated transceivers support both STM and ATM
transmission speeds up to 8Mbps, which is about 600 times faster
than with today's common 14,400bps modems. Westell says the
scalable DMT architecture supports a range of transmission speeds
from 32,000bps to 8Mbps from the network provider to the customer,
and 32,000bps to 1Mbps from the customer to the network provider.

'Several telecoms service providers have stated their desire to
implement standards-based DMT solutions for their DSL services,'
says Rob Faw, Westell president of global operations. 'Our company's
alliance with Motorola is intended to meet those customers'
requirements.'

Westell was also behind the development in June of what the
company claims is the first secure plug-and-play ADSL PC modem
card. Westell's new Flexcap PC-card modem - which is being used by
UUNet Canada in the world's first ADSL trial by an Internet service
provider - will enable rapid-rate video and data applications that are
not possible with current modems.

The initial product is scheduled for what Westell calls a controlled
introduction to telephone companies, Internet service providers and
customers during this summer, with general availability set for late
1996.

For consumers to take advantage of the benefits of the Flexcap
modem, phone companies and ISPs will also need to deploy ADSL
technologies in their networks. When they do, the modem promises to
provide 1.5Mbps speeds from the network to the customer and
64Kbps from the user's location to the service provider.

But the company acknowledges that the success of Westell's Flexcap
modem will be dependent on consumer demand for ADSL modems
and other high-speed communications technologies.

The Flexcap modem also offers software, developed by Canadian
software company Medialight, that includes encryption, user
authentication, enhance communications and routing protocol that
support single users, as well as business work groups.

For most people, ADSL is still a product of the future - but not very
far in the future. It requires neither the high user cost of ISDN nor the steep infrastructure cost to the world's phone companies. It is almost certain that within the next two years, many users will be clamoring to get hold of modems that use this technology.

For dealers and Vars the opportunity will lie in recognising the
capabilities this new technology creates, and developing solutions that make the best use it of. On the face of it, there appears little likelihood anyone will develop anything else that will offer the same kind of attractive price/performance ratio as ADSL before it starts to be widely available. But you can expect those with a vested interest in existing ISDN arrangements - as well as the nascent cable modem
market - to try very hard.

09-OCT-96
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