Cable modems, when does the serious video start??????????????????
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A Bullish Cable Modem Report
Kinetic Strategies pegs year-end number at 111,000; Comcast's Internet service
By Alan Breznick and Jim Barthold
The number of two-way cable modem subscribers in North America will climb past 100,000 by year's end, according to a new Kinetic Strategies Inc. report.
Kinetic, a cable Internet research firm based in Phoenix, projects that U.S. and Canadian MSOs will sign up slightly more than 111,000 two-way cable modem customers in more than 70 communities by Dec. 31. That's more than double the 50,000 high-speed data customers that Kinetic estimated for the end of the third quarter.
Time Warner Cable will continue to lead the way with 29,000 data subscribers at year's end, according to the research firm. It projects that the U S West Media Group will be second with 17,000 customers, followed by Cox Communications Inc. with 15,000, Rogers Cablesystems Ltd. with 11,000 and Comcast Corp. with 10,000.
Based on those estimates, the @Home Network consortium will close the year with 48,000 two-way, cable modem subscribers - almost double its 26,000 total at the end of the third quarter. The laggard in the @Home group continues to be lead partner Tele-Communications Inc.: It's projected to finish the year with only 4,000 data customers.
Kinetic predicts that the number of two-way cable modem subscribers will clear 200,000 in the spring and reach 1 million by mid-1999. It's also forecasting 3.2 million data customers by the spring of 2002.
COMCAST LAUNCH:
Comcast Commercial Online has launched a cable modem-based turnkey Internet access and communications service for businesses with up to 100 workstations.
Comcast Commercial Internet Service (CCIS) uses @Home Network's high-speed Internet backbone; Motorola Inc. cable modems; and on-site caching and routing to deliver individually branded e-mail, Microsoft Corp.'s Internet Explorer and other software.
Businesses will connect to the Internet via Comcast's hybrid fiber/coax network and @Home's Internet backbone at speeds equal to or in excess of T1 or ISDN lines, the service said. Prices will be lower than those offered by traditional telco operators.
CCIS is being introduced in several New Jersey communities served by Comcast Cable. In 1998, CCIS will be available in Baltimore, Philadelphia, Detroit, Orange County, Calif. and Sarasota.
ADC'S NEW MODEM:
ADC Telecommunications Inc. has introduced a cable modem system that the vendor says will address growing access requirements for the Internet and telecommuting products.
As part of the system, ADC will brand cable modems designed, developed and manufactured by Phasecom Inc. "One of the things that we have been developing with all of our products is the concept of Quality of Service [QoS]," explained Ham Mathews, ADC's program manager for cable data. "The problem is [that] when you get on these cable networks, it's a shared medium and you get too many people on there. A few users can hog the bandwidth and keep everybody else off and make it look like they're getting throughput similar to a dial-up modem, which is not what they wanted when they signed up for the service."
Mathews says ADC's products will let MSOs engineer networks, control capacity and prevent overloading: "From the end user's point of view, that means it's always on, always connected, and they don't get shut down by somebody hogging the bandwidth."
The system, which is moving toward compliance with the Multimedia Cable Network System Data Over Cable Service Interface Specifications requirements, can provide 250 simultaneous users with 100,000 bits per second in its minimum configuration.
When fully configured, 1,200 users can have the same 100,000 bits per second QoS provided by ADC's enhanced media access control scheduler.
The system is being positioned for small office/home-office users who need high-speed downstream communications and lower speed upstream.
BEEP BEEP!:
Looking to expand beyond the so-called "early adopter" market, Time Warner Inc. plans to introduce a revamped version of its Road Runner high-speed data service by spring.
The Road Runner 2.0 service, which will be introduced at this week's Western Show in Anaheim, Calif., will feature a redesigned graphic user interface; a new navigation menu; more integrated e-mail, message boards, chat listings and personal home page features; and more integrated national and local online content.
In another notable break with the past, the new Road Runner will feature much more online programming supplied by independent content developers.
Karl Rogers, the senior VP-programming at Road Runner, says he has signed deals with more than 25 national content providers, including A&E Networks, Bloomberg, CNET, Discovery Channel, E! Online, ESPN, MTV Networks, Yahoo! and ZDTV.
"Our commitment is to get the top two or three providers in each category," Rogers says, adding that he'd eventually like to sign 150 to 200 providers.
With more than 25,000 customers in 10 regions and penetration rates as high as 4% in its three oldest data markets, Time Warner executives hope that the overhaul and two new national marketing campaigns will build Road Runner into a mainstream service. They're shooting for 15% to 25% penetration in five years.
NEW FROM @HOME:
@Home Network also plans to unveil a new design, enhanced graphic user interface and new online features at this week's Western Show.
The new @Home interface will feature more multimedia content, including audio and video clips. Among other things, the new version of @Home also let subscribers have up to three user accounts
Separately, @Home announced a deal with Fourth Communications Networks Inc. last week that will put the cable high-speed data service into hotel rooms. Under terms of the agreement, @Home's @Work Network unit will become the primary provider of data network services to Fourth Networks' hotel customers, including the Hilton, Marriott, Hyatt, Radisson and Sheraton chains.
Using leased telephone lines rather than cable wires, @Home is already offering the service to three Fourth Network hotels in California. The partners plan to roll out the service nationwide to a few hundred hotels next year.
In addition, @Home will pay about $2.5 million for a 1.5% stake in Fourth Network. Fourth Network will pay @Home a monthly fee for the Internet service, as well as a share of ad revenues.
COX, INTERNET VENTURES DEAL:
Apart from its stake in @Home Network, Cox Communications Inc. plans to launch a turnkey, high-speed data service from Internet Ventures Inc. in a small southern California system next month.
Cox and IVI said the MSO's 32,000-subscriber system in Humboldt County is testing the one-way cable modem service in 100 homes this month. Plans call for rolling out the service to the entire system in January.
The two-tiered PeRKInet service, which relies on Hybrid Networks Inc. modems and a telephone line return path, will cost consumers $19.95 a month for 256-kbps speed. Business customers will pay $95 a month for much faster 10-mbps service. Installation will cost $99, and customers will pay an extra $17 a month to lease modems. Subscribers also will be able to buy the units for $350.
BRAVO'S NEW WEB SITE:
Bravo Networks plans to launch two "broadband" World Wide Web sites designed for cable-modem distribution early next year.
The two new sites dedicated to Bravo and the Independent Film Channel will feature a mix of the two channels' existing TV programming, current online content and original material, including live video coverage of local arts events.
Joe Cantwell, the executive VP-media distribution/development at Bravo Networks, says broadband Internet service will be "a melding" of traditional TV and current online features.
MSNBC SITE A WINNER:
MSNBC.com ranked as the most popular cable network World Wide Web site in October, according to Media Metrix Inc.
MSNBC's site beat out 18 other cable-related sites by generating a 5.1% audience reach, according to Media Metrix. Following it were The Weather Channel's site, ESPN SportsZone, CNN.com and Playboy's site. CNNSI.com, Discovery Channel Online, CNNfn.com, MTV's site and Food TV's site rounded out the top 10.
ANOTHER HIT:
CNN Interactive's four news sites scored the top combined rating in another recent ranking of popular World Wide Web sites by usage.
@Plan ranked the four CNN sites highest in its fall/winter survey. But the Weather Channel site topped the individual standings, followed by Time Warner Inc.'s Pathfinder umbrella site, CNNfn.com, ESPN SportsZone, CNN.com, USA Today, ABCNews.com, MSNBC.com and Business Week.
ALSO:
NetChannel, a rival Internet TV service to WebTV, has signed online programming deals with NHL.com, GolfWeb and seven other World Wide Web content providers.S The Canadian government has OK'd Telesat Canada's application to replace its Anik E satellites with two Anik F satellites in 2000; two of Canada's four orbital slots will be offered to outside parties.S CNNNfn.com and Intuit are teaming up to offer an online personal finance area - Quicken.com on FN - on the CNNfn Web site.S A&E has created a 13-part series of one-minute video documentaries, Bio-Bytes, for its Web site.S MSNBC on the Internet will distribute online content through MindSpring Enterprises Inc.S TBS SuperStation is launching a redesigned Web site with new sports and kids' areas this week.S Nostalgia Good TV will introduce its Web site at the Western Show.S BellSouth is carrying StarSight's interactive program guide on its digital MMDS system in New Orleans.
CAB, TVB DUKE IT OUT:
The Television Bureau of Advertising is continuing to spar with the Cabletelevision Advertising Bureau over how much the audience share is shrinking for U.S. broadcasters.
TVB landed the first punch earlier this month when it said broadcast had taken an early lead in the new season's ratings race thanks to average-to-date ratings that were almost double cable's, based on information supplied by Nielsen's Cable Activity Report.
That announcement was part of a new ad campaign launched this month by the broadcast group. The effort is scheduled to run for eight months in the Ad Age Daily Fax.
TVB credited broadcast with a prime-time TV household viewership in October of a 41.8 audience share - up from a 38.9 in September. Averaged together, TVB estimated that broadcast's average ratings for September and October stood at 40.4%.
The TVB also said that cable's household rating in October fell to 20.4 from a 22.1 in September.
"We've been reading a lot in the press lately about how cable TV viewership is rapidly growing, posing a serious threat to broadcast," said TVB president Ave Butensky. "Well ... the data we've found clearly shows that, when compared on a level playing field, broadcast TV is consistently the clear winner by a landslide."
On the flip side, CAB executives say the TVB's methodology is faulty and misleading.
"Comparing September numbers with October's is like comparing apples to grapefruits," said Steve Raddock, the CAB's VP-creative services. "It's silly to take September numbers, which are three-quarters full of summer reruns, and compare them with October, which is fully in the new broadcast season.
"Traditionally, broadcast viewership grows in the beginning of a new broadcast season, while cable viewership traditionally falls off during the same period."
Raddock added that "looking at year-on-year changes is a more accurate" way to calculate a network's gains or losses.
"When you look at broadcast viewership on that basis - new season to new season - broadcast continues to suffer from audience erosion," he noted.
PROGRAM ACCESS: ONE HOT TOPIC
A handful of Congressmen are reviewing the program-access rules with an ear open to DBS companies' complaints that vertically integrated programmers are skirting the regulations. At issue: Does the law that Congress passed in 1992 and the rules the FCC drafted soon after that give competitors fair access to the programming that they say the public clamors for? Or, as some MSOs have suggested, are competitors developing enough of their own exclusive programming packages that the rules need no tweaking?
(December 8, 1997) |
