August 5, 1990

SOME SNOOZING synapses, I hear, were awakened by last week’s column about establishing Silicon Valley as a test site — I like to call it a petri dish — for an upgraded telephone network. The proposal, brainchild of Bill Smith from Demand Video Systems in Victoria, British Columbia, would replace our aging copper wire with high-speed fiber optic cable by the year 2000. Similar technical proposals are being entertained deep inside at least one major company, and many others are excited about seeing such a project come to fruition.

This project, which I’ve dubbed “Fiber in the Valley,” is not related to the National Research Network (NRN) that Sen. Albert Gore of Tennessee is proposing — a packet-switched computer network for universities, research centers and hospitals, not switched through a phone company’s central office. Such a network has benefits, but it also will cultivate applications only for a rarified group of citizens.

A high-speed (“broadband,” it’s called) fiber network is capable of carrying exponentially more data than copper, and will make it possible for homes and businesses to send and receive many channels of data at once. That information could be almost anything that can be digitized — telephone signals, computer communications, video, sound, graphics, you name it. Such a network will not just improve our phone service to “hear-a-pin-drop” quality (although it can certainly do that). It will begin a gradual but massive shift in the way most of us move through our lives every day — which will absolutely change the way we entertain ourselves, conduct our business, secure our property, fix our appliances and run our homes.

But there is a problem here, and it’s the classic chicken-and-egg dilemma that holds back so much innovation. The phone company (the agar in this petri dish) doesn’t want to make a big investment in fiber to the home until there are applications like the ones I just mentioned, and the companies who have the smarts to grow applications on fiber don’t want to invest the time and money until they’re sure there will be a successful venue for them to exploit.

Smith and others are working to convince both sides that the experiment is worth the risk. I hand-picked a couple Silicon Valley visionaries who had some insights about the value of a fiber broadband network:

Jim Clark, chairman of Silicon Graphics Inc. in Mountain View, has testified before the Senate in favor of Gore’s bill. He thinks Pacific Bell should get a “special dispensation” from the PUC and FCC for FITV, including the ability to compete as “information providers,” something that is strictly verboten today (and, I think, for good reason).

“If in 5 years we’re still constrained to using ordinary phone lines, or placing fiber only in these test bed systems because we’re trying to keep the company with the best infrastructure in the world from participating in this, we’re just going to be the No. 2 or 3 player in the world economically,” Clark says.
One application he’d like to see developed for a fiber network is the ability to retrieve music from a music server. “There’s about three billion bits of information on an hour-long CD,” says clark. “With a three gigabit-per-second network, in one or two seconds you could download the whole bloody CD. I would gladly play 50 cents per listen, and I’d listen to a lot more music, too.”

Clark’s company doesn’t have any direct connection to such a project, but that’s not the case for Keith Raffel, director of business development for Echelon Corp. in Menlo Park, a company founded by Mike Markkula and headed by former Rolm chief Ken Oshman. Echelon is creating the structure for what it calls a “local operating network,” or a LON — a universal communications and control technology that’s applicable both in the home and in offices.

Raffel’s firm is focused on home control — security systems that sense when you’re home, know when you’re on vacation, etc.

FITV will have a great impact on Echelon’s world. “The same place you set up commands for your home is where you’ll also be telling the world outside what you want from it,” he says. This will allow for applications such as automatic thermostats, automatic dishwashing when rates are cheapest, and even keeping an eye on your kids using the house security system. “If you’ve got a video camera in the house, and a fat enough pipe (that is, fiber) to carry video to wherever you are, you could watch them from somewhere else.”

His favorite example is one that came from a colleague at Echelon — far-fetched, perhaps, but technically possible. “Your refrigerator knows what’s in it because everything that’s sold today has computer-readable bar codes,” Raffel says. “So when you’re out of something, your refrigerator calls Safeway and orders more food for you” — and, of course, your bank account is debited automatically.

Last but not least: Next week you’ll hear what Pacific Bell and a couple other voices on the equipment side have to say about FITV.