Phone and cable companies begin broadband battle. (DSL versus cable modem technology) (includes related article on how issue may be decided by interoperability) (Technology Information) Will Workman.

Abstract: Broadband technologies for high-speed data access will gain ground in 1998, leading to a war between cable companies promoting cable-modem systems and telephone companies pushing DSL. DSL leverages copper telephone wire to provide a constantly available voice and data line at speeds exceeding T1, while the cable industry touts three times the download speed of asymmetric DSL (ADSL) and promises a single bill for voice, data and video. Microsoft is hedging its bets with substantial investments in cable operator Comcast while sitting on the ADSL Forum and cooperating with GTE. Which technology will dominate is the focus of a heated debate; cost is a barrier with early DSL, but vendors say they will dramatically reduce prices as production ramps up. Cable modems are also dropping in price. Some argue that cable-modem speeds deteriorate when many people are online, but customers to date see no performance dropoff. Cable has the clear speed advantage, but only a small percentage of homes have been upgraded for broadband access.

Full Text: COPYRIGHT 1998 Ziff Davis Publishing Company

DSL, Cable to Compete for High-Speed Internet Access in '98

Forget about the browser wars; the really brutal high-tech fight in 1998 will be between the telecommunications industry and the cable business over which will control how consumers connect to the Internet for 1Mbps or faster broadband services. Although rollouts have been spotty at best, this is the first year where substantial numbers of users will be able to choose between digital subscriber line (DSL) and cable Internet services.

Ameritech, Bell Atlantic, SBC Communications and other regional Bell operating companies (RBOCs) say that DSL technology will let them transform the age-old copper phone wire into a high-speed voice and data line that's always available and offers speeds greater than corporate LANs' T1 links.

Cable operators, on the other hand, say that with cable modems linked to newly laid fiber-optic networks, they can deliver download speeds that are more than triple that of the most common form of DSL--asymmetric digital subscriber line (ADSL) service--and will soon offer homeowners a single bill for voice, data, and video programming.

Meanwhile, Bill Gates is placing bets on both high-speed horses. Microsoft Corp. has already plunked $1 billion into the nation's fourth-largest cable operator, Comcast, and has reportedly talked with No.1 and No. 3--TCI and US West, respectively--about similar investments. Meanwhile, Microsoft also sits on the ADSL Forum--a telephone company-backed consortium working on technical standards and other DSL issues--and is cooperating with GTE on an ADSL trial.

Both cable operators and telcos launched trials and limited commercial rollouts in various markets last year. By the end of 1997, the top cable operators--including the @Home, Road Runner, and MediaOne Express services backed by TCI, Time Warner, and US West, respectively--had more than 100,000 paying customers for cable modem service.

That gives cable the early lead over DSL, though one vendor, NetSpeed, says that a Canadian telco deployed DSL service using its equipment last October. And virtually all of the RBOCs say they'll easily catch and surpass cable modem rollouts by next year, with widespread commerical availability of DSL Internet downloads at speeds ranging from 1Mbps to 8Mbps.

Who will offer the better product first? That's the focus of a heated debate that raises more questions than it answers, most of them involving price, speed, and compatibility.

Taking price first, both ADSL and cable modem trials have followed different standards in different, limited market areas; as a result, modem prices have run as high as $500 for cable modems and $1,000 for their DSL counterparts--forcing telcos and cable operators to lease the modems to consumers.

DSL vendors, including such analog modem veterans as 3Com Corp. and Hayes Microcomputer Products, say they'll dramatically reduce those prices as they ramp up production of a new generation of modems. NetSpeed, for example, says it will begin offering its plug-and-play SpeedRunner PCI modem for $199 through its Web site, beginning in March.

On the cable side, companies such as Motorola, Samsung Electronics America, and Thomson (as well as Hayes) promise a new wave of lower-priced modems, and they say that last fall's industry-wide acceptance of the new Data Over Cable Service Interface Specification (DOCSIS) will lead to off-the-shelf sales of even more affordable, interoperable modems by 1999.

On paper, cable modems have their DSL counterparts beat in the speed department. Asymmetric cable modems boast download speeds of 30Mbps and more; ADSL modems generally max out at 6Mbps to 8Mbps--which is still 250 times faster than today's 33.6Kbps analog modems. (Both technologies' upload speeds are considerably slower, but still quicker than today's modems--640Kbps to 1Mbps.)

But analysts predict that speed degradation and guaranteed levels of service will become major issues. An ADSL line is always "on" and can be provided on a one-to-one basis with a level-of-service guarantee. But only homes within a mile or two of a phone company's central office--a figure varyingly put at 60 to 80 percent of U.S. households--will enjoy maximum performance.

As for cable, its potential Achilles' heel is the "shared pipe" problem--the possibility that you'll enjoy 30Mbps downloads as long as you're the first to have a cable modem in your neighborhood, but that other cable-modem subscribers will be able to hog bandwidth.

"Once you're sharing [cable Internet access] with other people, it starts to degrade," says Dataquest senior analyst Lisa Pelgrim, who adds that early shared-cable trials yielded reports of security glitches such as users being able to read files on their neighbors' hard drives.

But cable modem backers say real-world rollouts to date are showing no performance dropoff as additional users sign on. Jeff Walker, senior marketing manager for Motorola's cable data products group, says degradation is a nonissue because cable operators, sitting on top of 750MHz of bandwidth, can easily add another 6MHz (the equivalent of 40Mbps) channel to the cable modem path.

Although cable has the clear speed advantage, it will take time before cable networks can be rolled out because only a small percentage of American homes have been upgraded to receive cable modems. For example, of the 27 million homes covered by the newly merged high-speed services of Time Warner and US West, only 3.6 million were broadband-ready at the end of 1997, and slightly more than 45,000 customers had signed on.

Current cable modems also require a separate line and a home visit (costing as much as $100) for installation, all ratcheting up cost. Phone companies, by comparison, say that DSL service doesn't require a second line for voice calls. And though earlier implementations required the installation of an onsite "splitter" for simultaneous voice and data service, new modems, such as NetSpeed's or the 1Mbps modems backed by Rockwell and Nortel, don't. "[The consumer end] is the same copper line that's been in the home for 100 years, since Alexander Graham Bell," says NetSpeed marketing director Charlene Rogers.

But the telcos' aging infrastructure will require more than just slapping on DSL equipment and flicking a switch at the central office, say critics from the cable arena. "Some reports say that 90 percent of their plants are unsuitable for DSL above 1Mbps," says Motorola's Walker. "That's a major investment they have to make, so they are a long way from making this [technology] ubiquitous."

Interoperablity and service will also be significant issues as the ADSL/cable debate rolls on. The adoption of the DOCSIS standard has cable backers predicting a flood of under-$200, user-installable cable modems by next year; the DSL industry, meanwhile, is torn between a currently predominant standard called Carrierless Amplitude/Phase Modulation (CAP) and a more robust, video-friendly alternative called Discrete Multitone (DMT), which may prevail in the future. For 1998, at least, it's best to ask your local telco which brand or standard of DSL modem it's supporting.

On the service side, cable critics such as Pelgrim say that programming operators have little experience managing networks: "They're of the broadcasting mentality that you put a bunch of channels out there for people to pull down."

Cable operators retort that at least they don't carry the stigma of the phone companies' last high-speed offering to the masses, ISDN service, which frequently proved buggy and expensive.

So what's a customer to do about the choice between ADSL and cable modems? Don't worry, says Pelgrim--you'll probably be among the majority of online users who won't have access to either technology for a few years.

"It really doesn't do any good to compare the two," she says. "You'll be lucky if you get one; you'll be very lucky if you have a choice. The technology that most consumers will be using to connect to the Internet for the next five years is analog."

End-User Modems Shipped to North America

(Shipments in Thousands)     1996    1997     1998
Analog Modems                25,056  34,554   43,078
ISDN Adapters                314     597      908
Cable Modems                 25      80       210
xDSL Modems                  18      105      490
Total Modems                 25,432  35,441   45,176

Related article: Demand to Drive High-Speed Access Market

Did you know you were living in a narrowband world? Well, that's what old Web sites will be known as five years from now, after they've been replaced by the more dynamic, broadband content made possible by high-speed cable modem, DSL, or satellite connections.

"Five years ago, you were pleased as punch to have static Web pages in HTML," says Brad Sutton, manager of Microsoft Corp.'s NetShow video products group. Today, with Web sites sporting Macromedia Shockwave animations and MIDI music files, plus streaming audio and video, "that's going to push the envelope for people's requirements for faster connections to the Internet," Sutton says.

Video-enabled applications are already making their way into hotels, restaurants, universities, kiosks, and retail outlets that are hooked to dedicated servers and looking for a boost from broadband Internet access once it hits critical mass in 1998 and beyond. Dataquest estimates that DSL and cable modem providers will have 1.4 million subscribers apiece by 2001, though representatives of both industries say consumer demand will drive those numbers much higher.

This means that Web content is preparing once again to leapfrog current technology. "People really can't comprehend something that's 200 times faster than a 33.6Kbps [modem]," says Charlene Rogers, marketing director for DSL vendor NetSpeed. "You really have to see it to grasp it."

The broadband revolution has wider implications, too. "We're not just talking about Web-based content," says Howard Pfeffer, vice president of software technologies for Time Warner's Road Runner cable-access service. Push delivery, interactive video content, video streaming, videoconferencing, online games, distance learning, and other applications, he says, are "clearly where you're going to need broadband architecture."

"[High-speed access] has huge implications when it comes to push content," Pfeffer says. "Basically, the data lives out on the wire, so the whole idea of having to connect to get it, which is the current paradigm in the narrowband world, is odious."

Groupware could be another big broadband winner, expanding from corporate networks into residences and home LANs. "Once you have a constant connection into the home, people can be online at home and communicate with work," Pfeffer says.

All this broadband content begs this question: Which will be better, DSL modems, with download speeds of 6Mps to 8Mbps, or cable modems, with their peak speeds of 30Mbps?

Either technology is adequate for video streaming, according to Pfeffer, but a bigger pipe is always better: "My first principle is that content will expand to fill the available bandwidth, so the advantage lies with [cable]. If you give people two video streams, they're going to ask for eight."

Although it's too early to tell who has the content edge in the DSL-vs.-cable modem debate, Microsoft's Sutton says that the clear winners will be consumers and content providers: "I don't care what the technology is, as long as it's cheap and easy for the customer to get hold of."