Transport agnosticism made easy:
@Home division, @Work, to provide DSL service to Bay Area CLEC:
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Posted: 3:00 p.m., EDT, 6/29/98
@Home pact with telco carrier may be first of many
By Loring Wirbel
SAN FRANCISCO - Internet backbone specialists weaned on cable-TV hybrid-fiber/coax infrastructures are spreading their wings this month, showing that they are willing to play with telephony networks developed by competitive local-exchange carriers (CLEC).
@Work, a division of @Home Networks (Redwood City, Calif.) and the developer of services for business customers, signed a pact with Bay Area CLEC NorthPoint Communications Inc. to provide digital-subscriber-line services for its customer base.
For the past several months, Milo Medin, @Home chief technologist, has hinted that there is nothing in his company's network of dedicated local-caching servers that is specific to cable-TV multisystem-operator (MSO) networks. But the minority investment @Work made in NorthPoint last week is the first concrete effort by @Home or its subsidiaries to move directly into telephone carriers.
Analysts are expecting similar moves from the newly merged Time-Warner RoadRunner and MediaOne Express conglomerate, which two weeks ago received investments of more than $210 million each from Microsoft Corp. and Compaq Computer Corp. Although RoadRunner/MediaOne is aimed more directly at digital-TV services carried over HFC backbones, one source close to Compaq said, "some of the telephone companies are interested in revisiting the issue of video services over ADSL and VDSL, so it wouldn't be surprising if RoadRunner starts moving to more of a carrier-neutral strategy."
The biggest message of last week's @Work/NorthPoint deal may be that backbone specialists, as well as carriers themselves, must serve as neutral technology providers, being ready to switch allegiances if a cable MSO appears to be doing better than an ILEC or CLEC in a given region - or vice versa.
Transport agnostics
"Folks providing both backbone and content services are discovering they must be transport-agnostic, and give fair consideration to any wireline or wireless backbone," said Beth Gage, senior broadband consultant with TeleChoice Inc. (Denver). She said that the @Work subsidiary of @Home had an existing customer base on 56-Kbit and T1 connections, not cable MSO connections, which made the DSL deal with NorthPoint a rational extension of existing philosophies.
The backbone specialists working with both cable TV and telephony camps could represent the first merger point at which true hybrid broadband networks emerge. Gage cautioned, however, that the next two to three years will be characterized by separate parallel networks built by MSOs and telephone carriers, with true hybrid networks not emerging for five years or more.
Ann Zeichner, vice president of marketing at NorthPoint, pointed out that the relationship is non-exclusive for both companies. Also, @Work already has partnered on the non-MSO side by providing leased T1 services in conjunction with Teleport Communications Group. What the pact means for NorthPoint, however, is that the company can take its data-only wholesale CLEC service model to markets outside the Bay Area at a more rapid clip, since @Work will provide existing sales teams for NorthPoint SDSL services in at least eight to 10 regional markets by the end of the calendar year.
The relationship is only with @Work for now, though NorthPoint executives said that if they decide to aim wholesale xDSL services at residential customers, they may open discussions with the @Home group as well. John Stormer, director of business development at NorthPoint, said @Work chose NorthPoint as a partner because of its data expertise. NorthPoint founders came from MFS Communications Inc. (now part of WorldCom), and had worked on both xDSL and ATM networks.>>>> |
