Broadband Alternatives Debut

Residents in some areas of the US could be among the first to get 100 channels of digital video-on-demand, telephone service, videoconferencing, and high-speed Internet access all across fiber-optic cable to their homes as soon as next year.

Start-up World Wide Packets is beta testing its Subscriber Distribution Unit (SDU), which will enable carriers and other service providers to supply up to 1-gigabit data speeds to homes, apartment buildings, and small businesses, using the popular Ethernet protocol. It expects to start shipping the device early next year.

Each SDU can provide broadband services ranging from 10 to 100 megabits per second to eight individual homes or offices, as well as three lines of telephone service.

If that sounds technical and geeky, the company suggests you think of it this way: To download a 17.8GB digital copy of the science fiction movie The Matrix over a standard 56k modem, it would take almost two weeks of constant download time. Even a cable modem running at an average download speed of 1.5 mbps would take almost half a day.

If you used all the bandwidth available in the SDU, however, you'd be able to download that same film in only a little over a minute. However, if you were only getting 100 mbps--one of the eight "ports" on the SDU--that's still ten times faster than the fastest cable modem.

World Wide Packets foresees the day that every home is wired with fiber-optic cable. Indeed, utilities and phone companies routinely lay fiber in many new developments. The company expects to sell SDUs to those carriers, which will in turn resell high-bandwidth service to consumers directly or through providers.

SDUs will cost about $US1500 each. Subscriber services may be as little as $US40 monthly, plus fees such as an Internet service provider. But it may not be quite that easy or inexpensive, and it may take a while before the service is available everywhere.

"Do I think there's a market for video-on-demand to the home? Yes," says Lisa Pierce, a vice president focusing on telecommunications services at analyst firm Giga Information Group (US). However, several "gotchas" line the way, she adds.

In most areas the problem is retrofitting existing structures with fiber. "In New York City, there are still buildings with rotary-dial telephones and party lines," Pierce says.

She predicts it will take several years to upgrade existing infrastructure to support high-speed services. Phone companies face this challenge in rolling out DSL. It's a daunting investment for most carriers to upgrade to fiber the copper-based cable that connects existing homes, she says.

"What we'll find is lucky, fortunate pockets" of areas with the underlying fiber to homes, that can support this kind of service, Pierce adds. And she expects consumers will be receptive.

World Wide Packets executives think so, too. The technology uses the 1-gigabit Ethernet standard. And, they point out, more than 90 percent of all Internet traffic is over Ethernet. The 1-gigabit standard is rapidly being adopted in the telecommunications market.

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