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Companies starting to crank up bandwidth -- again

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Fool me once, and I blame you. Fool me twice, and I have no one to blame but myself. That's the lesson to keep in mind as you digest the latest wave of enthusiasm surrounding broadband to the home. If you've been watching the high-tech newswires, you can't help but notice that the broadband hype machine is gearing up again.

@Home -- which is building a nationwide high-speed network to help cable providers bring users to the NetÅ"recently had an extremely successful initial public offering. Not to be left behind, Microsoft recently acquired cable provider Comcast Corp. with the idea of jump-starting high-bandwidth services to the home.

High-bandwidth revolution

Cable modems aren't all that's hot. ADSL (asymmetric digital subscriber line) technology, which delivers high-speed Net access over existing telephone lines, is all the rage as well, with vendors rolling out ADSL and telcos promising deployments with zeal.

But hold on. There is absolutely no denying that these high-bandwidth servicesÅ"which deliver Net access at 30 times the speed and more of today's existing modem connectionsÅ"have the power to completely change a user's Internet experience.

Early beta testers report that the Web takes on a whole new look and feel when pages refresh in an instant and multimedia becomes a reality. High bandwidth to the home would literally remake the online advertising and marketing industries. Imagine the power of TV and radio coupled with the immediacy and point-casting power of the Web.

The problem is that these technologies are more costly and technically challenging to deploy than any telco or cable company will ever admit.

Empty promises

No, check that. These guys already pulled the wool over everyone's eyes several years ago when they promised to deliverÅ"by 1997Å"interactive TV via broadband networks to literally millions of users.

Five years ago, these were empty promises made in a successful attempt to catch the attention of regulators and politicians, in hopes that these mega-companies could win beneficial regulatory freedoms and entry into new markets.

Who would want to hold back these information-age titans from laying the data superhighway?

Today, these promises are just as overblown. This time, the telcos and cable companies see the explosive growth of the Internet, and the over-the-top valuations of Internet start-ups, and they are spinning a marketing tale to avoid the impression they are being left behind.

A couple of problems

A couple of problems are blocking true broadband speeds. On the telco side, these companies remain overgrown behemoths incapable of marketing what they have or changing technology directions quickly enough to meet the rapid pace of the Internet.

Despite some regulatory relief, they remain more concerned in protecting their historic regulatory advantages and using the government to fend off competitors than truly answering market needs.

Cable companies are no better. For them, the problem is mostly cash. They are debt-heavy, highly-leveraged companies. An influx of cash from Microsoft and the @Home tap into the IPO-capital markets could help. But it may not be enough.

At the same time, these companies own coaxial networks that have too often been deployed shabbily to begin with and then jury-rigged from within by home owners that want cable in every room of the house. These are less than ideal conditions for delivering high-bandwidth Internet services. These networks need work.

Network-based services are hard to market as well. You've heard of ISDN, which can get you 128 Kbs to the home today, a nice jump over 28.8 Kbs modems? Well this isn't a new technology. It's at least a decade old, and has been re-marketed, re-priced and re-packaged by the telephone industry literally dozens of times.

Revising, revisiting technologies

You know what? Cable modems and ADSL aren't brand new either. They've already been around for a few years. These technologies aren't being pioneered right now, they are being revised and revisited.

Expect the ISDN experience to be repeated as cable and ADSL modems roll out. This is complex technologyÅ"for both the user and the carrierÅ"that will take a long time to become truly ubiquitous. The latest broadband barons will tell you it's right around the corner, and that the Web will change forever.

It's going to happen. Just don't expect it -- outside of a few small pocketsÅ"to happen anytime soon. You heard it here: Don't be fooled again.

Richard Karpinski is editor at large for CommunicationsWeek and author of "Beyond HTML" from publisher Osborne/McGraw-Hill.

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