Davis says he has talked to some subscribers who are quite pleased with the service. In fact, he says he's even received calls from some people who aren't in the test wondering when they can sign up for SBC's cable service.
The FTTC architecture itself has been fleshed out by suppliers like AT&T and Broadband Technologies Inc. which provided key elements for the switched digital network. Lockheed's Media Systems Integration group is acting as the systems integrator and heading up overall project management. Initially, computer giant Microsoft was selected to provide an end-to-end software package and OSS.
However, Driscoll says Microsoft's decision to pull back on interactive TV efforts in lieu of an Internet focus, took Microsoft out of the Richardson project loop. Recently, SBC signed on to the DiviCom/Zenith platform and will be deploying Zenith set-tops, acquired through americast, later next year.
Driscoll does note that if and when SBC should decide to roll out the system beyond the 1,800 test homes, it won't be using the technology it's using now. He says SBC began the test with "an earlier version of Broadband Technology equipment" because the "technology we wanted to roll out was not ready."
The video trial, says Driscoll, does not include any tests of high-speed modems. Nor has the telco reached any decisions on wireless technologies or whether it will seek other franchises in its five-state (Arkansas, Kansas, Missouri, Oklahoma and Texas) local telephone service area.
From all that's not being said, it seems a variety of important SBC decisions are apparently...on hold.Technology changes; goals remain the same
After evaluating a number of different video technologies, Bell Atlantic is now saying that switched digital video over a fiber-to-the-curb architecture is its network of choice, and has plans to upgrade between 600,000 and 800,000 homes per year to FTTC, starting in 1997. Because the company has about 20 million access lines, the upgrade will take quite some time; however, it will still fall well within the bounds of Bell Atlantic's existing capital expenditure program, says Larry Plumb, director of communications for Bell Atlantic. Plumb adds that for the past 12 years, that program has been running in excess of $2 billion per annum. The company currently has more than 2.2 million fiber miles which link its switching offices to key points in its network.
"The first markets we'll upgrade are the neighborhoods that have to be rehabilitated because the copper plant is 20–30 years old," says Plumb. And the first of those will be in Philadelphia and southeastern Pennsylvania later this year, with the fall of 1997 as the probable target date for delivering video over an FTTC architecture there. By late '97 or early 1998, the operator plans to add broadband Internet access, data communications and interactive multimedia applications into the service mix.
The Pennsylvania upgrades are major steps toward Bell Atlantic's full service network deployment in the mid-Atlantic region. Last July, the telco selected Lucent Technologies to supply key network components for that deployment, which will work in concert with BroadBand Technologies to offer up host digital terminals and optical network units with standard interfaces for operations support systems.
But even before the Philly system is up and running, Bell Atlantic Video Services will begin offering programming in Dover Township, N.J., slated to occur before the end of this year. This latest twist will be made possible, in part, by Bell Atlantic Video Services' proposed acquisition of certain assets of FutureVision, a division of Digital Broadband Applications Corp. (DBAC). FutureVision, which launched digital video entertainment and interactive services on a Bell Atlantic fiber optic video network in Dover Township last winter, will seek to assign its programming agreements to BVS, insofar as they apply to distribution over the Bell Atlantic network in Dover Township.
FutureVision owns a digital integration center located in Neptune, N.J. which will be part of the acquisition, as will the licensing of DBAC's subscriber management system.
Related to the acquisition, Bell Atlantic has filed a request with the FCC to convert the Dover Township network, originally a video dialtone system, into an "open video" system. (Video dialtone rules were repealed when telecommunications reform legislation was passed earlier this year.) A type of common carriage agreement, an OVS designation would allow different video providers to use Bell Atlantic's video network, and Bell Atlantic Video Services will be one of those providers.
In the interim while the company's full service network is being built — and it could be a long pause — Bell Atlantic will launch wireless video service, in the form of digital MMDS, to quickly enter the video provision marketplace. The first launch will be in Hampton Roads, Va. in the spring of '97 via networks constructed by CAI Wireless Systems Inc. (see related story, "Nynex," page 61).
In MMDS, "You have a robust product that can compete head-to-head with cable," says Plumb, referring to the fact that cable services are still being delivered via an analog platform. Through its investment in CAI Wireless, Bell Atlantic will gain access to MMDS distribution systems with the capacity to deliver about 100 channels in digital quality.
Any discussion of the company's wireless plans has to include an update on the Tele-TV joint venture between Bell Atlantic, Nynex and Pacific Telesis Group, which was set up to provide programming, as well as technology including set-tops, to the three companies. The video systems integration unit of the company, Tele-TV Systems, has contracted with Thomson Consumer Electronics for up to 3 million set-tops to be used in the trios' MMDS systems.
But because all three members of Tele-TV are involved in mergers (Bell Atlantic wants to acquire Nynex; SBC is after PacTel, and SBC is a member of the americast consortium), the dynamic of the joint venture may change, with uncertain results.
For the time being, however, plans are still on track — in one example of that, Bell Atlantic will roll out its service in Hampton Roads in the spring of '97 with the Tele-Tv brand name.Different technologies, same goal
While Bell Atlantic's transmission medium of choice may have changed several times over the past five years, the mission is the same, says Plumb. "Consumers don't buy networks," he notes. "Our goal is to provide the best of cable, coupled with the best of a videotape rental store."
Each technology evaluated by the company had to meet both of those criteria, in order to be accepted. While Bell Atlantic has flirted with hybrid fiber/coax in the past, it was not convinced that the technology could deliver full, two-way interactivity, and thus announced in May of 1995 that it would pull its "214" video dialtone applications that were before the FCC, stating that "this clears the way for the company to use newer switched digital video (SDV) technology, which will bring fiber very close to the home."
And while the company is trialing ADSL for the delivery of data, there are a couple of technological constraints that made it less than ideal for video transmission. For one, as was demonstrated in a technical trial that took place in 1993, ADSL did not interface well with the company's digital loop carrier and fiber systems; for another, Bell Atlantic soon discovered that old party line systems that had lain dormant for many years were unpleasantly awakened by the technology, resulting in some less than desirable interactions. Though initial thoughts were that ADSL would allow the operator to reach 95 percent of a metropolitan market, in reality, those technical glitches meant that only 25–30 percent could be served with ease.
In the data realm, Bell Atlantic has launched a trial of ADSL for high-speed access at 1.5 Mbps (64 Kbps for consumer data transmission) in a limited area of northern Virginia. The trial, which could be extended beyond its scheduled December 31 close date, will include a maximum of 500 customers.
As for LMDS, it remains an open question, says Plumb, noting that his company still retains its interest in LMDS provider CellularVision of New York: "We want to keep the rights to bid on that spectrum." That opportunity is slated to happen later this year.Going for the cable gusto
Ameritech New Media Enterprises Inc. continues to pursue cable franchises with great gusto. At last count, the operator had cable TV franchise agreements with 25 communities in the Midwest, covering in excess of 1.4 million people (as of mid-October). Of those 25 communities, Ameritech is already offering cable service to portions of 14 of them: eight suburbs in Detroit, Mich.; two communities in the Chicago area; and four communities in Ohio (see Figure 5 for a complete franchise listing). In the Midwest, as it brings its cable systems on-line, the operator will go head-to-head with the likes of Time Warner, Jones Intercable, Tele-Communications Inc., Continental Cablevision, Comcast Cable, Cablevision Systems and Coaxial Communications.
And, the company reports that it is conducting franchise discussions with an additional 30 communities in its region, which falls in nicely with its plans to expand its franchise clusters in order to capitalize on economies of scale.
"We have to walk a fine line between rolling out very aggressively," says Ameritech New Media spokesperson Dave Onak, "and making sure that we can do it at a pace that allows us to maintain quality control. There are communities calling us, wanting franchises. And we are saying that we'd love to, but we are a start-up, and can't be everywhere at once."
In one of the latest announcements of that batch, Ameritech has been granted the franchise for Sterling Heights, Mich., a Detroit suburb, where it will construct a two-way HFC video network later this year, with the delivery of "americast" services to begin early next year. In another recently signed agreement, the board of Clinton Township, Ohio granted Ameritech a 15-year franchise for the area, which is an unincorporated region surrounded by the city of Columbus.
Initially, those subscribers who sign up for the operator's full service, billed as "Ameritech presents americast," will purchase an 80–90 channel package composed of about 60 channels of expanded, basic cable; 10 premium movie channels; 10 pay-per-view channels and The Sega Channel (The expanded basic package will offer The Disney Channel and The Golf Channel at no extra charge.). The programming package is the offspring of the Americast joint venture between Ameritech, The Walt Disney Company, BellSouth, GTE, SBC Communications and SNET.
All of this entertainment will be riding on hybrid fiber/coax networks to reach the operator's customers. Unlike several of its telco brethren which have backed off of plans to build HFC networks for video, Ameritech still seems to be committed to the architecture, which it is deploying in a 750 MHz version, down to nodes of 400–500 homes. In addition, the company is hanging its franchises off redundant fiber rings.
"To us, it (HFC) looks to be the best solution when you look both short-term and long-term," says Onak. "Maybe some companies which aren't going to be offering video for a few years are waiting for something better, but as of right now, it's a cost-effective way to deliver the channels that we are offering. And yet, it 's easily upgradable to handle the several hundred channels that will be available once we get into the digital world."
But a commitment to HFC doesn't mean that Ameritech has closed the door on other technologies. Engineering executives continue to watch the progress of digital MMDS, possibly as a complement to their HFC networks. "MMDS seems very promising, but there are still some concerns, such as, is it really just an interim step because of its bandwidth constraints?" elaborates Onak.
Like Bell Atlantic and Nynex, the company is evaluating the merits of ADSL for the delivery of access to high-speed data services and the Internet. Last month, Ameritech and IBM were scheduled to begin a trial of ADSL technology to deliver access to the Internet and other data services to about 200 customers of both companies located in Wheaton, Ill., a suburb of Chicago.
In a footnote to the company's plans, Ameritech chairman, president and CEO Richard Notebaert has been quoted in the press recently as saying that the company has not completely dismissed the possibility of delivering video over ADSL.
Clearly, Ameritech is keeping its video options open. From the beginning, the company's video strategy has been shifting to accommodate new information. In one example of that, back in 1994, Ameritech's video arm first announced plans to enter the market as a provider of video dialtone; however, not wanting to lose precious time waiting for the rules for VDT to be defined, Ameritech soon decided that becoming a cable operator was the fastest way to get into the video business. "And now, with open video systems (OVS), everything is still not clearly defined," says Onak. "We made the right decision."
In another example of its bet-hedging, Ameritech, as part of the Americast venture, has signed a non-exclusive contract for the purchase of at least 3 million digital set-tops from Zenith Electronics Corp. which will allow consortium members to deploy MMDS, HFC, SDV and direct broadcast satellite video networks. The set-tops, which are slated to be produced starting in the first half of 1997, use interchangeable network interface modules to provide flexibility in adapting to various business and content delivery models. "We wanted to make sure that, moving forward, we had the capability of delivering our services via a multitude of technologies," adds Onak.
In addition to the subscriber equipment purchased from Zenith, Ameritech New Media is working with suppliers including Scientific-Atlanta, Digital Equipment Corp. and ADC Telecommunications Inc. to construct its HFC networks.
Beyond its video forays, Ameritech, through its various subsidiaries, is involved in a range of services including local and long distance service, cellular, paging, data and even inhome security monitoring. "The goal is to become a full service provider," says Onak.One size doesn't fit all"
While Nynex is throwing its energies into the deployment of digital wireless cable (MMDS) as a short-term video strategy, for the long haul, the operator has decided that "one size doesn't fit all," as it evaluates a number of technologies, including switched digital video, according to a corporate spokesman.
"The near-term effort is to get into the marketplace as quickly as possible," he notes, "and establish the brand with wireless cable, then watch the development of these other technologies."
In the context of its MMDS plans, Nynex will begin testing digital wireless cable in the Boston area sometime this quarter, made possible by its investment — with Bell Atlantic — in CAI Wireless, which will provide the delivery networks for Nynex programming in Boston, and for Bell Atlantic's programming in Hampton Roads, Va. Set-tops purchased by the Tele-Tv consortium from Thomson will deliver the programming to the homes of Nynex "friendlys" in Boston, and sometime during the first quarter of 1997, Nynex will move the service from a trial into a limited deployment.
"We will be evaluating the results in the Boston area to determine where we go next," says the spokesman, "and future rollout plans."
According to the terms of the relationship with Nynex and Bell Atlantic as it was originally announced, CAI will design, construct and maintain digital MMDS networks in 13 markets served by the two telcos. The wireless operator is expected to build systems for Nynex in Providence, Rhode Island; as well as in Albany, Syracuse, Buffalo, Long Island and New York City, N.Y. Both telcos will lease their systems from CAI on a per-subscriber, per line-of-sight basis.
However, as was recently reported in CED's sister publication, Multichannel News, CAI Wireless has informed the SEC that it, Bell Atlantic and Nynex are renegotiating their agreement (see MCN, Oct. 17, 1996, page 8). Some of the items under discussion include "extending the time the Bells have to exercise an option to become the wireless cable provider and marketer in a given system using CAI's systems and sharing revenue with CAI."
Longterm, though, Nynex believes that interactivity will be key to the deployment of video, and because MMDS does not currently support interactive services, the company will have to pursue another strategy to launch itself into the video realm.
Like Bell Atlantic, Nynex also cooled on HFC technology, this after concluding a trial of analog video dialtone services in Manhattan in the summer of 1995. The Manhattan trial utilized an HFC network to deliver cable programming for Liberty Cable Television and Time Warner to 2,500 apartment dwellers in three East Side buildings.
Further, after completing some preparatory construction work, Nynex suspended construction of the full service HFC networks it was due to build in Warwick, Rhode Island and in Somerville, Mass. (in Warwick, the network had been slated to pass all 60,000 homes; in Somerville, the company's 214 application was for 360,000 homes in the area). "Prior to the actual buildout of the network, the decision was made to look at (new) developments in technology," says the spokesman.
So what will take the place of HFC as the company's interactive video strategy? Perhaps switched digital video. In fact, just before CED went to press, Nynex chose GI subsidiary Next Level Communications to provide FTTC technology as part of its future video plans. The multi-year agreement includes about one million lines of transport electronics.
"The prices continue to drop for robust technologies like SDV," notes the spokesman.
Regardless of the type of technology used, Nynex plans to begin offering interactive video services by early 1998.
Like its proposed merger partner, Bell Atlantic, Nynex is looking at ADSL, but only for data, not video. To evaluate the copper-based technology, Nynex, Lotus Development Corp. and Westell are conducting a trial that gives Lotus software designers and developers the ability to access both the Internet and Lotus corporate networks at high data rates, utilizing Westell's FlexCAP ADSL modems. The test includes a 1.5 megabit link from Nynex's CO facilities to the residences of 60 Lotus employees based in the Boston area.
Plans to enter the Internet access market later this year, though, revolve around ISDN, dial-up phone lines and dedicated lines.
Rather than weighting video, voice, or high-speed data services more heavily, Nynex is instead searching for ways to attractively package different combinations of services for customers.