Chicago Blues At Cable Confab
By Karen Brown
from the June 18, 2001 issue of Broadband Week
CHICAGO -- While many of the cable industry's top execs were sounding cautiously optimistic every chance they got, there was a distinct bluesy undercurrent at the annual National Cable & Telecommunications Association confab last week.
Organizers literally tried to trumpet enthusiasm by using a drum and bugle corps to introduce the show's opening general session. But attendance was down and major announcements a rarity. Many attendees found a show lacking the luster of previous years with smaller booths and wider aisles on the show floor--which in contrast to previous years took up only one of the McCormick Center's two cavernous exhibition halls.
Many of the panel sessions reflected the rising doubts of the broadband communications industry.
AT&T Broadband president and CEO Dan Somers found himself on the receiving end of several pointed questions fired by a trio of journalists during one morning session, including a question of whether AT&T Broadband might become buyout bait when it is spun off later this year. Somers quickly dismissed that idea, saying the company did not need to take defensive measures as it heads toward its planned fall IPO.
"I don't think we need a poison pill," he says. "I think our chairman yesterday did a pretty good job of putting up the 'Not for sale' sign."
Equally pointed were questions about the troubled Excite@Home cable modem service, which faces the possibility that two of its major MSO partners may be dropping out soon amid lingering questions about its service quality. Somers defended the service, pointing out that just this week it gained a cash boost by selling $100 million of zero-coupon, five-year convertible secured notes.
"Excite@Home has gone through difficult times, but so have others," Somers said.
Fellow panelist Michael Willner, CEO of Insight Communications, also saw reason for more optimism about Excite@Home. His company "started using @Home a few years ago and the service was horrendous," he said. After pulling back from Excite@Home last year and demanding improved service, "I can tell you today there is a remarkable recovery level today with @Home," Willner said.
With prospects for cable modem subscriber increases good, he argued for industry watchers to look forward, not back, Somers added. "Our job is to help them get healthy and to grow with them together," he said.
The show also marked the entry of broadband companies that have been considered traditional cable rivals--though discretely located off-site. From a 33rd-floor hotel suite, Global Crossing Ltd. was drumming up business for its new Media and Entertainment Extranet among programmers wanting a digital transport option for their material.
Meanwhile, competitive cable provider RCN Corp. convened a morning sit-down with its execs to discuss its direction and several projects--including work on a fiber-to-the-home initiative.
In the past year, RCN has been forced to scale back plans to enter several markets, turning its attention instead on widening footprint in existing markets. But RCN is finding good success in bundling its products in existing markets--bundles offered to more than 486,000 homes. The ResiLink bundling program now accounts for more than half of the new RCN customer connections.
While cost remains the key stumbling block, RCN also has learned much in a year and a half from its fiber to the home experiment.
"We've learned that it is a challenge to build," says Richard Rioboli, vice president of technology and market development at RCN.
The Princeton, N.J.-based operator has been running a single node, data-only fiber-to-the-home experiment to 30 homes in an undisclosed market.
"The moral of the story is it is a challenge to do, but it is definitely doable," Rioboli says.
Doable, that is, if the bottom line can be worked out. While it could eventually pump 100 megabits per second to the home, RCN has faced the same problem other telecom providers have found with the technology--the price tag. RCN has been looking at fiber-to-the-home for about four years now, and while there have been improvements that are dropping the overall fiber plant cost, it is still too high. Rioboli says the cost to push the fiber from the node to each home still is more than the cost of the entire hybrid-fiber coax connection per each home.
RCN has started looking at other technologies including Fast Ethernet to pump up the bandwidth pipe to customers without the extra fiber. Its Megaband Network program drives fiber optics to within 900 feet of the customer and it has expanded to about 8,000 miles of network in dense-population markets, allowing a wider capacity and range of voice, video and data services.
Improvements in Internet Protocol video formats eventually may allow operators to squeeze more video channels down the same cable plant, particularly with IP multicasting technology, which beams only active channels into a home rather than the full video spectrum.
"We really think IP video is starting to turn the corner," Rioboli says.
|
