Phone Firms Race To Speed Web Access
New Standards to Challenge Cable Modems
By Mike Mills
Washington Post Staff Writer
Wednesday, January 21, 1998; Page C11
Imagine walking up to any computer in your house, typing in an
Internet address and instantly viewing a page on the World Wide
Web. No more busy signals. No more seeming eternities for a
Web page to materialize.
And no tying up the phone line.
Cable companies are just beginning to offer such high-speed,
no-hassle Internet access. But now their rivals, the local phone
companies, are finally in gear too.
The regional Bells and GTE Corp. are about to announce an
agreement with Microsoft Corp., Intel Corp. and other computer
industry giants on standards for a new kind of modem and phone
company service that, analysts say, could bring mass-marketed
high-speed Internet access to every home and business.
The standards would not only make the modems affordable and
ubiquitous, but also would ease the construction costs that had
made the technology unprofitable for phone companies to offer.
Officials from Intel, Microsoft and Compaq Computer Corp.
would confirm only that they plan an announcement involving
Internet access over phone lines at the Comnet trade show in
Washington next week. News of the agreement was first reported
in yesterday's New York Times.
But the agreement will involve many more businesses than those
companies, sources said; more than two dozen hardware and
software makers, as well as telephone companies, will participate.
"We're really at the beginning of an era of competition in
consumer Internet access," said Frank Gens, an analyst for
International Data Corp. in Framingham, Mass. "It's still off in
the distance, but you can really start to see the death of the
bandwidth crisis."
"Bandwidth" is the computing world's term for the carrying
capacity of a communications connection -- how much
information can move per second -- and Intel, Microsoft and
Compaq all are spending money to increase it. For instance,
Microsoft invested $1 billion in Comcast Corp. to help the cable
company strengthen its cable network so that it can send and
receive data. Intel has investments in cable modem ventures,
including @home, a California company, as well as satellite
Internet businesses.
The agreement reached between the Bells, GTE and the computer
industry involves a technology known as "digital subscriber line,"
or DSL. It's essentially a way to cram more data through copper
telephone lines, allowing them to carry multiple "channels" of
data.
The common standards would allow consumers to choose among
competing brands of DSL modems -- costing from $100 to $200
-- that would work in any personal computer. Phone companies
would have to provide DSL service over their lines, and most
today are only test-marketing the heretofore costly service.
The new agreement shows that software giant Microsoft isn't
counting only on cable for high-speed Internet access to the home.
"It's a vote for telephone lines. That's very encouraging for us,"
said George Hawley, president and co-founder of DSL equipment
maker Diamond Lane Communications Corp. of Petaluma, Calif.
Researchers have long known that voice conversations use only
the lowest electronic frequencies that travel along copper lines.
The higher frequencies, they learned more recently, can be used
to carry data in the computer language of ones and zeros.
DSL technology was developed to help telephone companies carry
video programs over their traditional copper telephone lines at
speeds up to 8 million bits of data per second (compared with
today's computer modems, which operate at a top speed of 56,000
bits per second). Phone companies, including Bell Atlantic Corp.,
quickly found that the costs of equipping homes for DSL video
signals exceeded the demand for such a service.
But the rise of the Internet opened a new use for DSL. In 1996,
Bell Atlantic began new market tests using digital subscriber lines
for high-speed Internet access in Northern Virginia.
Trial users had a service through which they could breeze through
pages on the World Wide Web like leafing through a book -- for
about $50 a month, including Internet service provider fees. Users
could talk on the phone while surfing the Web and, in fact, they
no longer had to "dial up" their Internet provider at all, because
DSL offers a continuous, 24-hour connection.
Customer response has been "extremely positive," said Mark
Wegleitner, vice president of new services technology for Bell
Atlantic. "They like the speed. They like the always connected
environment. In general, we would find it very difficult to deny
this to them once they've started using it."
The new standards being adopted by the computer and phone
industries remove a technical drawback that added significantly to
DSL's cost: the need for phone companies to install a "splitter"
outside each home to separate data and voice signals.
The resulting DSL "lite" moves data at 600,000 to 1.5 million bits
a second -- less than 8 million bits per second, but still the speed
that Web surfers crave. The lower bandwidth means no
interference with voice calls.
People who want more bandwidth still can choose a splitter. But
the latest technical breakthrough means that DSL can be marketed
like any other computer modem -- requiring no visit by a phone
company.
Local phone companies are gradually upgrading their switches to
offer DSL services. Bell Atlantic's Wegleitner said the company
will begin offering the new service on a market-by-market basis
by mid-year. "Washington will be very high on our list," he said.
Still, critics from the rival cable industry say the switch upgrades
themselves could cost enough to reduce DSL's competitiveness.
"There are significant challenges in deploying this," said Stephen
Dukes, vice president of network technologies at
Tele-Communications Inc. in Denver.
Bell Atlantic and other local phone companies have been
promising new digital services, from Internet access to video, for
years. It took nearly a decade for an older form of high-speed
Internet access, called ISDN (integrated services digital network),
to actually become available in this region. And it has been
plagued by technical problems and pricing disputes.
The Bells also have been focused on other priorities, like winning
regulatory approval to enter the $80 billion long-distance
business. "They're so involved in getting into long distance, DSL
hasn't been a high-priority for them," said John Hunter, an analyst
for TeleChoice Inc. in Verona, N.J.
It is a high priority now -- mainly because the Bells fear the
potential of cable modems -- and the result is a horse race that
could benefit consumers.
International Data Corp. estimates that 16,000 homes will have
DSL technology by the end of the year, up from merely hundreds
of test homes in 1997. By comparison, the firm estimates there
will be 300,000 homes wired for ISDN service by year's end,
compared with 160,000 this year.
Cable modems will be in roughly 200,000 homes by December,
IDC predicts, up from 100,000 in 1997. But DSL will eclipse
them both by 2001, IDC estimates. By 2002, about 20 percent of
Internet connections in U.S. homes will be either cable or DSL,
the firm predicts.
Staff writers Elizabeth Corcoran in San Francisco and Mark
Leibovich in Washington contributed to this report.
c Copyright 1998 The Washington Post Company |
