Dave, All:
AOL's stated requirements for access via broadband cable should be inspiring some discussion here. T doesn't want to let them in on their terms. Can't say I altogether blame T. While AOL may need HFC at this time to satisfy their tactical demands, their strategic requirements call for something much better.
The HFC architectures that the MSOs have cooked up don't support multiple tenants on the same black cable very well. At least not in an elegant manner. And vying for spectrum on these HFCs can, and will, become just as contentious as A and B Blocks in the cellular/pcs spaces have been.
How will AOL and the OpenNet Alliance respond? [For the uninitiated, OpenNet was recently formed by AOL and other ISPs to lobby against T/TCI/ATHM on these kinds of matters, due to what they perceive as being "locked out" of broadband HFC cable access by T/TCI/ATHM, or something very close to that effect.]
I've given this some thought, and I came to an uncultivated (as usual) gut conclusion that the "third overlay" debate we had here recently (principally a discussion which was greatly collaborated and facilitated by WTC), a couple of months ago may be ready for renewal.
This time, however, it's my newly arrived-at opinion that it will not be by the power companies and startup CLECs, per se, but by the ISP community. I have a right to alter my views, too ;-)
There may just be the requisite critical mass of both motivation (desperation?) and raiseable capital by the large ISPs, now, to pull it off.
AOL's market cap, along with those of some of the other deep pocketed Tier Ones in both the ISP/Portal and backbone spaces, could be sufficient to garner support, and additional financing, for what we've been looking for: A passive optical network (PON) build to the home, or FTTH.
If the ISPs under an OpenNet kind of umbrella, say, announced an initiative to blanket the residential landscape with silica, their caps would likely increase by some measure, perhaps with the creation of subsidiaries, or alliances, whose businesses would resemble or mirror those of LVLT's or QWST. The difference being, and this is a biggie to crack, this time in the residential space. Maybe to include one or both of the latter, as well. Who knows?
LVLT is already on this path in certain ways, albeit it appears that their last mile residential aspirations will be through affiliations for the time being (until they ultimately acquire them?). They have focused their principal builds in urban business sectors, and not to the residence, yet. But you can watch for continued attraction by them to the RCNCs of the world, which is, in itself, supportive of what I'm suggesting here.
It's not that far fetched to picture a build which is financed and populated by the ISPs and other next generationists. They can make this work, IMO, with the collaboration of utility company grid cooperatives, municipalities, and fiber construction companies. Also, there are many urban and rural area builds that were put in by incumbents, and currently exist with leasable capacity in them.
Clearly, there is no dearth of municipalities who would provide the necessary rights of way to them at this time. Especially with all of the debate that recently took place about how paltry and miserable some cable services have been in certain areas, vis a vis franchise renewal requests by TCI during their pending acquisition by T.
While AOL and Mindspring and the others will be struggling to squeeze out the last couple of bits that can be had from DSL, and while they are bickering with T over access to HFC, an architecture which itself is replete with backwards compatible compromises, and one which portends problems in the future for its own principal ISP functions, they may experience a new revelation. This vision that strikes them may be very similar to what many recently-married couples have faced throughout the ages:
If they have to pay exorbitant rentals and forfeit the accruing of any interest or equity for their pain, AND if they plan to have children soon and the quarters they are currently in are too tight, then they may as well venture out and buy or build their own.
I was about to do a whole thing on this angle here in the LMT, until SteveG on the WCII thread diverted my attention to America's Network Magazine, where I found this inspiring gem, below. It's an article written by chief stupidist (stated with due respect, and in deference to the man's own wishes, despite what I may say about some of his following), David Eisenberg.
What do you think about the possibilities of a third overlay in the context of pure fiber to the home? One, possibly put in on the backs of the ISPs? All comments are welcome. [article follows]
Regards, Frank Coluccio
----------------------
americasnetwork.com
February 1, 1999
Canada brings fiber home
CANARIE proposes gigabit Internet to the home while U.S. telcos diddle
with DSL.
By David Eisenberg
When Bill St. Arnaud tries to show earnest telco types
the leading edge, he might as well be talking Martian. When he
explains how he'll deliver gigabits via fiber to the home
(FTTH) for about the same cost as megabits via digital
subscriber line (DSL) or cable modem, their minds seem to be
stuck in the traffic jam at the intersection of IP and SS7.
In the midst of the distracting pseudo-battle between DSL and cable modems,
it's hard to remember that FTTH is still the broadband endgame. Despite the pall
of failure around early-1990s interactive TV, the supremacy of fiber has been
clear as glass for over a decade.
St. Arnaud, the mild-mannered director of network projects for the Canadian
Network for the Advancement of Research, Industry and Education
(CANARIE; www.canarie.ca) has not lost sight of the FTTH beacon. The
newest CANARIE project, CA*Net3, will throw away synchronous optical
network (Sonet) and asynchronous transfer mode (ATM) to become the world's
first all-optical Internet backbone. St. Arnaud believes this design can be
extended into the home. He proposes to throw away DSL and cable modems,
too, bringing CA*Net 3's all-optical multigigabit Internet into every Canadian
home by 2005.
WDM in local networks
In long-haul networks, wavelength division multiplexing (WDM) has increased
fiber capacity by a couple of orders of magnitude in two short years. This year, a
single fiber will have throughput for 15 million calls — enough to handle the
entire U.S. busy hour.
But WDM has not yet hit the local loop. St. Arnaud thinks it's because
established providers are tangled in reuse of their own nets. Cable companies
have cable modems, so data service can run on existing, broadcast-oriented
networks. Telcos have DSL, which is backward-compatible with twisted pair.
For both, the key word is backward.
The same goes for transmission protocols. Sonet was designed for reliable voice
(connection-oriented) networks. ATM's goal was a single protocol for handling
voice, video and packet services. Neither anticipated Internet Protocol (IP).
Sonet and ATM become shaky when they're not propped up against legacy
networks. Sonet becomes unnecessary in an all-IP world, because packet
protocols like IP thrive even when lower layers are unreliable. ATM loses when
Internet telephony and audio-on-demand thrive, because more bandwidth and a
few IP tweaks promise to make real-time and streaming media scream.
To St. Arnaud, the whole idea of convergence is a backward-looking attempt to
preserve existing assets. He proposes a divergent, third residential network for
Internet traffic only, installed alongside telephone and cable feeds. Like the
CA*Net 3 backbone, it'll have only two layers: IP and WDM. Information over
light. It'll be a stupid network — cheap and simple, under-engineered,
over-provisioned and controlled at the edge by users.
Gigabits for microcents
Installation (right-of-way, trenching and conduit) represents the most cost. In a
100-km. metropolitan network, a conservative installation estimate is $4.3 million.
Routers and equipment to light the fiber might cost another $1.8 million. Using
today's 128-wavelength equipment, a single 48-fiber cable would serve 6,144
homes. Each home would have its own WDM wavelength that could be lit at 2.5
gigabits per second (OC-48). This computes to $1,000 per home.
The alternative, new hybrid fiber-coax (HFC) to support cable modem service,
delivers hundreds of times less, and costs half again more. Even retrofitting
existing cable to carry two-way data could cost $600 per home. DSL, somewhat
cheaper, delivers even less than HFC.
CANARIE's optics would meet residential equipment at an Ethernet interface.
The step from 2.5 gigabits (OC-48) to 1 gigabit Ethernet might seen wasteful.
But St. Arnaud points out that the next Ethernet evolution — 10 gigabit Ethernet
— just happens to match OC-192. Local and wide area nets would merge in yet
another fundamental simplification.
Why Canada can
In Canada, a lot of municipal fiber already exists, thanks to favorable regulatory
policy. But in the U.S., bean-counters of communications behemoths shy from
huge installation costs. They look at today's applications and figure that current
networks can be kludged to handle them.
Make way for high-definition Internet video on demand, or whatever truly
broadband application Canadian users dare discover. CA*Net 3 could make
Canada the center of the next Internet economic boom. Meanwhile, U.S. telcos
manage mawkish mergers, dither with DSL and forget fiber to the home. Look
north, young entrepreneur.
David S. Isenberg can be contacted at www.isen.com. Readers may send
comments to anrespond@americasnetwork.com.
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