Full-Service Networks from Both the Cable Companies, Telcos?
Richard Green, CableLabs
Dick Green, president and CEO of CableLabs and two-time keynoter at Digital World, found “a refreshing note of commercial reality” resonating at this year’s conference. We no longer are debating whether multimedia is a business so much as figuring out who is going to build the infrastructure and control the content.
In many ways Green believes this sense of certainty has something to do with a string of recent commitments to network expansion on the part of cable and telephone companies. “With billions of dollars already earmarked for cable and telephone network development, and billions more soon to be anted up, there can be no doubt that digital communications is poised for quantum growth,” he said.
The cable perspective.>> Green used his closing keynote this year to provide perspective from the cable side, “on where we are, and what we think we need to do to accomplish success for all parties to the digital communications revolution.”
He advocated that members of the converging industries make a firm commitment toward interoperability and an open telecommunications architecture model. “If we can avoid trying to use proprietary technology to lock in markets,” he said, “we’ll be able to expand and use the infrastructure for a long time to come. And, more importantly, we can all compete knowing that the network will be a fair and open platform providing a vehicle for development and delivery of new products.”
The full-service network.>> For Green, the telecommunications network model of choice — for both cable companies and telephone companies — is the full-service network (FSN) model first discussed by Time Warner as part of the Orlando project (see “Projects and Prototypes,” p. 27).
The Orlando project will “serve a 10,000-household base in suburban Orlando starting at the end of this year,” said Green. Green said that Time Warner is planning to build the FSN network throughout the major urban areas served by Time Warner, including New York City, Orlando, Cincinnati, Kansas City, Indianapolis, Columbus, Houston, Raleigh, Durham, Memphis and Rochester. As Green said, it is “not a bad market base in which to nurture demand for digital services of every type, for services from voice to VR.”
By cable industry standards and capital spending standards, TW’s FSN is expected to be costly — the media giant has not announced the exact cost, although analysts have estimated it to be north of $500 per household, including the core home terminal equipment — even beyond the first installation cost phase. “But by the standards of what it would cost to do anything similar using any other means, whether they be existing telephone networks or unbuilt wireless transport systems, the FSN is an incredibly low-cost implementation of a digital service platform that promises to last well beyond this decade,” said Green.
TCI, Cablevision not far behind.>> In addition to Time Warner, Tele-Communications Inc., the largest MSO, with more than 10 million subscribers, recently announced its commitment to spend $2 billion on the installation of a fiber-coax network companywide within four years. Cablevision Systems has embarked on a similar project at an estimated cost of $300 million.
It isn’t just the huge cable companies that are making large commitments to fiber, however. According to Green, Scripps Howard has rebuilt its Chattanooga, TN, system, extending fiber to 500 home-serving areas, and in Syracuse, NY, Adelphia Communications is putting in a 1-GHz network — that’s 150 analog channels — which will draw fiber all the way to 200 neighborhood nodes.
As the penetration of fiber increases, said Green, it delivers far greater capability and functionality within the network. “With this deeper fiber extension we can provide dedicated virtual channels to every household within each area served by a fiber link,” he said.
The evolution of the box.>> This provides traditional cable service that everyone can watch in the usual way, employing low-cost terminals or cable-ready TVs in the home. It also means cable operators can continue to use addressable analog terminals to allow for segmentation of this block of channels into à la carte offerings at various price points or offer a package of “point-to-multi-point” digital services such as a cluster of current movie hits using digital compression.
“From here,” explained Green, “we go to a more advanced terminal in users’ households, where the premium subscriber has a digital decoder built into the analog addressable terminal. Or, if we want to devote bandwidth to the allocation of virtual channels on demand, we can provide a box in the home that can be expanded to accommodate user participation in the services offered over the virtual channel.”
Telcos to adopt FSN? According to Green, the cable companies are not the only ones enamored of the FSN design approach. Although it has not been widely adopted by the telephone companies, its appeal is strong enough that both US West and Southwestern Bell are preparing to make use of the cable approach to deploy broadband networks. In fact, he said, Bellcore is drawing up a specification to fit FSN design to the needs of the telephone companies.
US West’s initial FSN test will begin later this year in Omaha, Nebraska. The company says it plans to hook up 100,000 homes to fiber-coax broadband networks next year; it will continue at a pace of 500,000 homes per year through the end of the decade, said Green. As reported in Digital Media (see Vol. 2, No. 10/11, p. 32), Southwestern Bell has contracted to purchase two cable systems serving 265,000 homes in the Washington, DC, area. (The company is widely reported to be on a hunt for more such acquisitions.)
The pursuit of interoperability.>> While Green firmly believes that fiber to the neighborhood is a winner, he made it clear that the point of his talk was to pitch the concept of the full-service network, not cable’s deployment of it. “This is not a discussion about one industry’s advantage over another,” he said. “I’m talking about a fundamental change in the telecommunications architecture.” He encouraged all of the converging industries to keep an open line of discussion and to work toward standards that will allow “a network that will be a fair and open platform providing a vehicle for development and delivery of new products.”
Janice Maloney