‘Never have we been so open to suggestion’

Just about the only thing that everyone acknowledges, in varying degrees, is that digital video is the key to “erasing the boundaries.” Andy Grove believes that consumer-acceptable (thus economically viable) digital video compression is still a number of years off, and, as a consequence, that the initial customers will be business users who are willing to pay higher prices for lower quality video (see p. 3).

But Dick Green, president and CEO of CableLabs, believes that consumer-quality digital video compression is, indeed, just around the corner. If he is right, it is likely to be the consumer market that leads the charge, and businesses will use the higher-quality, lower-cost consumer technology.

Green said the CableLabs research consortium –representing some 85 percent of cable subscribers in the U.S. — is deeply involved in the transformation of analog video to digital. It has at least one good reason to do so since, according to Green, the capability to deliver pay-per-view digital movies to the home could tap cable into a large share of the $11 billion video-rental market.

Digital cable by 1994. In fact, Tele-Communications Inc. (TCI), the largest cable provider in the U.S., with Viacom International and the Public Broadcasting Service (PBS), is now hearing proposals for video compression/decompression systems. The first step (by late 1993) will be to use the technology for satellite transmission, decompressing the signal at the “headend” of the cable distribution system. This should provide a four-fold increase in the number of channels that can be transmitted per transponder.

The second step (which Green expects to roll out in early 1994) will be transmission of digitally encoded signals to the home. Green expects that this will permit broadcast of eight channels over a single MHz video channel.

Fattening the pipe. In addition to moving from analog to digital transmission, the major cable companies are committed to replacing their coaxial distribution system with a high-bandwidth fiber network. Besides the bandwidth limitations of coax, the current “tree” system (which relies on a series of amplifiers to maintain signal strength as it travels down miles of coax cable) is highly unreliable. When any amplifier goes out, it takes out everything down stream.

The transition to fiber will replace this with a “fiber to the service area,” or FSA architecture that will provide fiber trunk lines to “service areas” of 250 to 500 homes, with existing coax providing the “last mile” to the home. This will give cable both two-way switching capability and a reliability that begins to approach that of the phone network.

The cost of doing this, Green believes, will be manageable, even for an already leveraged industry. “Fiber is as cheap as coax cable now,” he said, and the existing investment in coax to the service area represents only 19 percent of the total cost of a cable system.

Unlike the telephone company, which will also be an integral part of the national information network, cable providers such as New York-based Viacom are not waiting for information services magically to appear before they install the high-bandwidth fiber-optic cabling that will make tomorrow’s applications such as interactive television and pay-per-view movies a reality. They believe that this is simply a logical (and economically attractive) extension of the entertainment franchise they already have (see “Interactive Television Arrives,” p. 20).

In the process, they will find themselves already set up to provide HDTV transmission, interactive services and two-way communication. This is why cable is now reaching out to other industries — and to the computer industry in particular. CableLabs’ top priority, Green said, is the marriage of computer, cable and public networks. The computer industry has been especially noisy in its call for a national high-speed data network capable of connecting every person, home, business and/or government agency, and has persuaded the cable industry to heed the call as well.

Green is well aware that cable is likely to be the most prevalent alternative high-bandwidth network, and as a result, wants to be sure that every type of digital technology imaginable runs seamlessly over its wires. That’s why CableLabs is so hard at work developing technology for cross-licensing that will be available to anyone who wants to develop products for home use.

To help the process along, CableLabs will provide guidelines for digital delivery of data on cable systems — program guides, multimedia and other services, one way and interactive — including protocol, packet structure, error correction, etc. It is already working on interconnection technology for phone, cellular, satellite and computer networks. And whatever CableLabs comes up with in the way of transmission standards, Green promises it will be widely cross-licensed to ensure its ubiquity.

Ubiquity through cooperation. Indeed, cable is dabbling in just about every digital technology on the map today. And for good reason. In its transition to the digital world, the cable industry certainly does not intend to give up an 85 percent (and growing) market penetration.

If there is a unifying theme to the fast-and-furious pace at which the cable industry is adopting digital technology, ensuring its ubiquity through cooperation would have to be it. As Green says, “There has never been a moment when the cable industry has been so open to suggestion.”

Denise Caruso