Austin: Broadband battleground
Its no secret that Texans do everything big. They live big. They spend big. Hell, they even fight big.
Remember the Alamo? Well, dont forget Austin either.
Yep, thats right, Austin.
As the United States enters the digital world of the 21st century, the primary goal of the 1996 Telecommuni-cations Act is finally coming to fruition. Competition amongst tele-communications providers is breaking out all over the place, and Austin, Texas is one of the key battlegrounds for this high-tech war for voice, video and data.
Why Austin?The city jumped to the number-two spot on the ZDnet/Yahoo! Internet Lifes Americas Most Wired Cities and Towns list in 1999. Beat out only by San Francisco (a repeat at number one), Austin bested such burgs as Seattle, Washington D.C., Boston and Atlanta in the annual comparison that used home and network Net use, domain density, hosts per capita, directory density and content quality to rank the cities.
But whats put Austin at the top of the broadband battleground list? Its a matter of demographics, business diversity, high-tech savvy and, well, location, location, location. Austin is in the center of the state and its a corridor for all routes through the state, says Michael Parks, director of telecommunications and regulatory affairs for the city of Austin. So, that makes it very attractive for long-haulers to come through and put in facilities within our infrastructure so that they can then reach any direction in any way at any time.
Kirk Ladendorf, a technology reporter for the Austin American-Statesman newspaper, believes the city has an appeal for broadband service providers with the people and the businesses that call Austin home. Its both demographics, with the fact that this is a very tech savvy town, a very tech hungry town and a very bandwidth hungry town. And, its also the perceived business base, says Ladendorf.
Companies in the area include the headquarters of Dell Computers, as well as such companies as Motorola, Texas Instruments and Tivoli Systems. Theres also the Texas state government and all its sundry departments, bureaus and offices. And, of course, its the home of the Longhorns, the University of Texas.
One ringy dingyCovad, NorthPoint and Rhythms, and their local ISP reps, are all slugging it out in neighborhoods all across Austin. The DSL providers have had to work out interconnection agreements with the incumbent RBOC (regional Bell operating company). In Austins case, that means Southwestern Bell (part of SBC Communications Inc.), and it hasnt been pretty.
Both Rhythms and Covad fought Southwestern Bell at the Public Utility Commission (PUC) over those interconnection contracts. The fight got so nasty that for the first time in its 23-year history, the PUC forced the RBOC to pay $850,000 for failing to produce documents and witnesses.
Despite its apparent foot dragging on DSL interconnection agreements in the past, Southwestern Bell and SBC arent twiddling their thumbs on expanding DSLs reach today. The companies are currently involved in a $6 billion Project Pronto initiative which pushes fiber and digital electronics deeper into its networks so that customers are within 12,000 feet of a central office or one of its neighborhood gateways. SBC says it plans to have activated approximately 4,000 neighborhood gateways by the end of 2000, and 18,000 by the end of 2002.
As far as video goes, Southwestern Bell isnt breaking any new ground in Austin or anywhere else. Given the fact that SBC dropped PacBells cable-based video efforts like the proverbial hot potato after its acquisition, its no big surprise that Southwestern Bell is taking all of its video cues from SBC and marketing DirecTV service.
The real battle for broadband services (video, voice and data) is being fought in the telecom trenches of Austin by the likes of Time Warner Cable, Grande Communications and WINfirst (formerly known as Western Integrated Networks).
As the incumbent broadband provider, Time Warner has parlayed its position as the first TW division to launch digital service to bolster its leap into new services. For the most part, were probably 90 to 95 percent upgraded, says Steve Farabee, Time Warners director of digital online services in Austin. Thats 750 MHz, two-way. And we were the first TW division to launch the digital set-top box. Consequently, our growth of our digital cable has been great.
The company has spent millions over the past two years to rebuild its network. As a result, it has put more than 30,000 high-speed data customers on its books.
Farabee hopes to trump his cable modem success with a VOD (video-on- demand) offer. The company is working out the kinks of a VOD service in nearby Round Rock, using technology from Scientific-Atlanta and SeaChange International. Farabee says the service is in 5,000 to 10,000 homes already and he expects it to be generally available in most of Austin over the next six months.
The telephony part of the broadband play is still under consideration, says Farabee. We really havent done anything with our cable plant in terms of residential voice yet, says Farabee. That may occur down the road.
If Grande Communications or WINfirst have anything to say about it, Farabee can take all the time he needs.
Grande Communications has already started construction on a deep fiber network in Austin that will stretch along I-35 and connect with a similar network in San Antonio. Grandes 860 MHz network features fiber all the way to 24-home nodes, says Bill Morrow, CEO at Grande. This network, says Morrow, is the deepest fiber deployed network in the nation at this point. Were building in Austin, San Antonio and San Marcos today.
We have actual signal going through our new retail network in San Marcos. Were adding test customers next week (mid-December), and well be adding test customers in Austin in December and in San Antonio in January. And well go full commercial launch in January, February and March in San Marcos, Austin and San Antonio respectively. He says the buildout will take about five years to complete, and once completed, will pass nearly 1 million homes in the central Texas corridor.
Morrow says its not so much the declining cost of fiber, but the more affordable equipment that makes this network and its future growth possible. The optronics are coming down in cost. When I started in this business back in the early 90s, we were building 500-home nodes. And now, were at a 24-home node at almost the same cost structure.
Meanwhile, fiber-to-the-home (FTTH) is the goal of WINfirst. While the company hasnt broken ground yet in Texas, it has broken ground in Sacramento, Calif. The company has franchises in Austin, San Antonio and San Diego, as well as franchise efforts in eight other markets in the Western U.S.
WINfirst is constructing an optical access network that will connect each home with a dedicated fiber optic cable and laser equipment to send and receive information using IP (Internet protocol) and Fast Ethernet to provide 100 Mbps of symmetric bandwidth. The company will also bring a strand of coax to the home.
Were building what were calling a DFC network, says Shiraz Moosajee, vice president of business development at WINfirst. The dedicated fiber allows us to do data and voice. The coax, or cable allows us to do broadcast video.
Two key pieces of this FTTH network have been developed by Lucent Technologies. A Network Demarcation Unit (NDU), attached to the outside of the home, will terminate the fiber connection and use a laser to send and receive voice, data and video traffic over the network. The NDU will also connect to a Residential Ethernet Gateway (REG) located inside the home and connects to the PCs and telephones inside.
This dramatic commitment to fiber, says Moosajee, is based on a firm belief that the days of DSL and cable modem technologies are numbered. Both DSL and cable modem data solutions are Band Aids, says Moosajee. They are very, very poor at what theyre trying to force them to do, i.e., data transport.
I think the question is, how do you transport data at the highest level? We came to the conclusion that it was fiber. Once you solve that problem, a lot of the problems that you see in terms of availability of DSL, shared bandwidth, install procedures, install times, etc., simply disappear because youve answered the right question.
The company broke ground on its Sacramento system in August. Its expected to begin turning on service by mid-2001. Next on the agenda are San Diego and four Texas cities, Austin, San Antonio, Houston and Dallas.Austin city limits
All this competition has both its upside and downside for the city. Austin finds it very desirable to have those companies come in because we believe it provides choice for residents of the city, says Parks. Competition is goodnot that competition will cause prices to decrease, but it will provide choice. And choice will make each company thats a player in this market be very high on customer service levels and what theyre offering in order to distinguish themselves within this market.
I think any city would want competition to come to their city just to provide choice to their residents. However, there is the disruption associated with your streets being cut. Given that, that may be a discouragement unless you have some sort of infrastructure already in place that will minimize the amount of construction.
Parks says there are problems with disrupted traffic, parking and noise every time a street is cut. On top of that, every trench shortens the life of the road. Its estimated it costs $40,000 to repave and from $100,000 to $300,000 to reconstruct a mile-long lane of street.
The solution, says Parks, is for service providers to work with the cities to minimize future construction. Its something that could benefit both the provider and the city. I think they really should come in and meet with city officials with a quick assessment of what they feel the city needs by way of infrastructure management, says Parks. As theyre trenching and digging up things, they should agree to provide capacity or help the city in the future put in conduit or duct work. Or they could allow the city to put in ductwork as theyre building.
Theyll be giving back to the city, but theyll also be protecting themselves as well. Because if no one else has to cut that area, theres less likelihood of some of their stuff getting cut.