Testing the Waters
Cable operators are proceeding with care,
but visions of the ‘broadband home’ are clearly on the horizon.
MSOs expect to conduct more trials
and tests before taking the home networking plunge.
They clearly are not yet ready to take the home networking version of the "Nestea-Plunge," but a growing number of cable operators are getting their feet wet with a variety of laboratory tests, technical field trials and market deployments.
Adding to that momentum, the industry is moving forward on a specification designed to extend DOCSIS capabilities to other devices in the home and essentially lay the foundation for a future, cable-enabled broadband home.
AT&T Broadband is taking its home networking partnership with Linksys nationwide. In cooperation with Linksys, the MSO is offering the equipment and charging $4.95 for each additional IP address on a customer's home network.
While testing the mettle of those technologies is important, making a shift to a money-making proposition is also key if recent estimates of the short-term market provide any indication. Cahners In-Stat Group (an analysis group owned by the same company as CED) estimates the connected home equipment sector will hockey stick from $1.4 billion by the end of this year to $9.2 billion by 2006.Starting simple
So far, most technical and marketing trials have involved basic home networking set-ups designed to share broadband connections among multiple PCs and peripherals.
The nation's largest MSO, AT&T Broadband, is taking a multi-tiered approach on home networking. For starters, it's moving aggressively into the market with equipment supplied by Linksys Group Inc. With an eye on the future, AT&T Broadband is already testing more technically advanced platforms with a handful of customers.
Figure 1: How home-owners use home controllers.
In late September, AT&T Broadband elevated a limited marketing trial in Seattle, Wash. and California's Bay area with Linksys to a national campaign to market home networking applications to all of the MSO's cable modem customers. The AT&T Broadband-Linksys combination markets wireless (802.11b) and wireline (Ethernet) options, allowing customers to share their cable modem connections with as many as five PCs. In turn, AT&T Broadband is charging an additional $4.95 per month for each additional IP address tethered to the home network. AT&T Broadband also gets a cut (between 10 percent and 15 percent) of all Linksys gear sold through the program, a source says.
That equipment does not exactly come cheap. For example, a typical network that links two computers via wireless gear runs about $400, AT&T Broadband spokesperson Sarah Eder says. According to AT&T Broadband's Web site, Linksys' wireless access point carries a price of $199.95, a wireless network adapter goes for $99.95, and a wireless network PC card and PCI card sell for $99.95 and $39.95, respectively. However, Linksys' Ethernet-based equipment generally costs a bit less.
Eder says demand was strong during initial trials, but she would not disclose how many customers have signed up so far. Anita Messier, Linksys' senior manager of broadband services, adds that the initial results were better than expected, but the "national launch will increase that," she promises.
As for operational logistics, AT&T Broadband does not plan to dispatch field technicians to deploy the service, but is relying on Linksys to handle virtually all customer and technical support. Messier says Linksys provides customer support 24 hours a day and has created a Web-based "Network Builder" that helps newbies determine what type of equipment they'll need to set-up a home network that suits their needs.
"This is a first step toward realizing and evolving the broadband home," Eder says, noting that future endeavors could include other applications and services powered by broadband.
The next steps already are well under way. Eder confirmed that AT&T Broad-band is conducting a technical trial with Ucentric Systems involving less than a dozen "friendlies" in the Boston area. That trial, launched in August, is expected to run for five months. AT&T Broadband is also administering a similar test with Intel Corp.'s media gateway/home server in an undisclosed market.
Another large MSO, Time Warner Cable, is also plotting its own home networking plans. Last year, the MSO launched a market trial with SOHOware Inc. to offer Road Runner customers in Austin and San Antonio, Texas, the ability to share their broadband connections with as many as four computers. The marketing trial offered the service for an additional $19.95 per month.
The MSO's home networking feelers haven't stopped there, however. Since then, Time Warner Cable has examined more than 150 vendors in search of the right technology and solutions, and is paring those down to a "short list," says company Vice President of New Product Development Jeff Henry.
By employing Ucentric's software, prototype gateway and wired and wireless hookups, about 50 Rogers customers can send and retrieve e-mail and instant messages from just about any screen in the house.
Henry estimates that Time Warner Cable is presently in the second phase, but "we've got one leg into the third," he says. He adds that the MSO has tested PC and peripheral home networking technologies with about 100 live customers in a variety of undisclosed markets. "[Customers] love it, but the question is how much they would be willing to pay for it," Henry says, noting that Time Warner Cable could offer a home networking package to paying customers by the end of the year.
Philadelphia-based Comcast Corp. has centered the majority of its home networking efforts in a laboratory setting as it attempts to test myriad products and solidify an eventual business model.
Most recently, Comcast has started to test the Ucentric platform in the lab, essentially giving it an acid test to determine its capabilities and potential shortcomings when operated over cable lines, notes MSO Senior Vice President of New Media Development Steve Craddock.
Craddock says platforms from companies such as Ucentric are intriguing because they have the potential to serve as the software "glue" that ties together the physical layers of the home network and to integrate them via an intuitive GUI (graphical user interface).
"In short, I want to see what makes it tick, and what it takes to break it...as I do all things I evaluate in the lab," Craddock says. "Based on the success of this phase of the trial, we'll evaluate next steps which would include extending the trial to 'tech friendlies' in a live cable system."
In June, Comcast and Intel Corp. announced a trial involving Intel's line of residential broadband gateways, wireless-network adapters and host-based cable-modems. Craddock says Comcast continues to test Intel's product in the lab, as well, and is exploring a number of services that could be delivered over that platform with an entertainment-oriented focus.
Technology aside, Craddock says Comcast believes in "home services" as opposed to home networking. It's "a subtle but important distinction [that] holds the potential to be a significant business to Comcast," he adds.
Whether Comcast would charge a separate fee for installs and maintenance is yet to be determined, because it's more of a packaging issue at this point.
One-time home networking installations or structured wiring opportunities may aid Comcast's high-speed data business, "but we don't believe that is a mainstream mass market business for someone like Comcast," Craddock adds.
Like Comcast, Charter Communi-cations Inc. has yet to announce that any formal home networking trials are underway today. Still, that doesn't mean that the technology is not on the MSO's radar. In fact, it plans to launch as many as four marketing trials before the end of the year, says company Vice President of Corporate Development Jim Henderson.
An eye on security: Equipped with cameras, @Security's system allows customers
Later on, residential gateways and Web tablets could enter the fold as Charter seeks partners to distribute and stream multimedia content throughout customer homes as part of a bundle of broadband services.Advancing on the networked front
Canadian MSO Rogers Cable Inc. is among the most aggressive when it comes to testing advanced home networking platforms in the field. For instance, the operator presently is conducting a trial with Ucentric that involves about 50 customers in Ajax and Pickering, two Toronto-area communities.
Subscribers there are using Ucentric's prototype gateway and software that links their homes' televisions, PCs, telephones and other peripherals via wired and wireless networking protocols. That configuration is designed to enable customers to retrieve voice mail from the phone, TV or PC, to send and receive instant messages on any screen and to play music on any speaker in the house.
Ucentric Director of Marketing Paula Giancola notes that home networking is still in its relative infancy, and installations today share similarities with early cable modem deployments in the mid-1990s. "We have a lot of learning to leverage, and to push the [installation] times down," she says.
Depending on feedback and other variables, Lee says Rogers might expand the Ucentric pilot to more homes and offer additional feature sets before the end of this year. A hard-drive-based media server/personal video recorder is among the features under discussion.
Giancola says the hard drive capabilities will allow customers to pause a show in the living room and resume it in the bedroom, for example. "It will be a first," she predicts.Forging the specs
Of course, the future of home networking over cable lines is closely tied to CableHome, an initiative CableLabs launched last year with the goal of extending DOCSIS to all areas of cable customer homes.
Intel Inside (the home): Comcast and AT&T Broadband are among MSOs
Also slated for CableHome are documents that describe the security between the HFC network and the home network, as well as service provisioning for remote management and home network address management (see page 62 for related story).
CableHome Director Bernd Lutz says the first public release of the home networking specification is slated for early 2002. Like DOCSIS, CableLabs expects to assign numbers to CableHome specs as features are added. However, CableLabs has not decided whether it will conduct compliance testing or full-blown certification waves.
CableHome developers also are mulling over whether to employ help from outside agencies.
CableLabs has held discussions with representatives of OSGi (Open Services Gateway Initiative) and VHN (Versatile Home Networks), a group driven by the Consumer Electronics Association.
Lutz says OSGi's framework/middleware for loading and executing applications in a secure and controlled, authenticated environment is of particular interest to CableHome. "Those are things that would go beyond what we here at CableHome do," he says.
Adds OSGi President John Barr: "We feel that OSGi APIs (application programming interfaces) will enhance the [CableHome] platform by allowing them to deliver solutions that do more than what it can do now."
However, a "true convergence" of CableHome and OSGi is unlikely, says Allied Business Intelligence Inc. Vice President of Residential and Networking Technologies Navin Sabharwal, noting that OSGi's model is more generic and open to any service provider. VHN, meanwhile, mirrors CableHome in that both approaches touch consumer devices.
Despite these potential synergies, no partnerships between CableHome and outside agencies have been carved in stone. "We all agree that it makes sense to continue our discussions, but we have not come to any kind of definite resolution," Lutz says.Securing an opportunity
While most of the home networking discussion has centered on entertainment-based and bandwidth-sharing systems, another potentially lucrative area involves home security and monitoring.
Taking the lead in this area is @Security Broadband Corp., a start-up backed financially by Adelphia Communications Corp., Charter, Comcast, Cox, Rogers Communications and Shaw Communications.
Instead of a simple network that triggers an alarm when a window or door is opened, @Security's product, dubbed "SafeVillage," will instill more intelligence via video cameras and other devices. A front door camera, for instance, would record events when the motion detector is tripped. Customers can also monitor their homes remotely via the Web.
The company plans to launch the product by the end of 2001, and expects to announce additional partners and to begin shipping products during the first quarter of 2002, says @Security Senior Vice President of Marketing Annie Bacon.
Charter is "very interested" in adding home security services to its future agenda, but that prospect is a bit further out on the horizon, says Henderson.
Comcast is also taking a closer look at the service. @Security Broadband, says Craddock, "would seem a likely candidate to provide such services in a walled garden environment."
Thus far, @Security's highest-profile move is a completed alpha trial with Cox in Las Vegas. In that technical pilot, which involved about 100 subs, @Security wanted to accomplish two items: to design a video-based system that integrates with existing two-way cable plant, and to build a success story to take to other partners.
Taking that next step will involve "limited market" entries, as @Security and its cable partners target cities that best represent the mass market. The hope here is that the service is firing on all cylinders before it's offered to a wider population.
On the financial side, cable subscribers would be willing to pay $30 or $40 per month for a cable-centric, home security service, says Glasgow. Those numbers hold, he adds, because home security customers already pay about $29 per month for a less advanced service.
A classic security system typically collects "dumb" data, reporting that an event occurred, say the opening of a door or window. "But it can't tell if it's ongoing, so the result is [most] alarms are false," Glasgow says.Diving in?
Many cable operators expect to do more than dip their toes in the home networking waters. Following the growing set of tests, trials and initial deployments, it could be as early as 2002 when cable operators jump in to tell the world that the water's fine.
Looking ahead to 2002, Henry says Time Warner Cable will likely test more advanced home networking prototype services. He notes that audio represents a big opportunity as customers would likely be interested in an application or service that pushes music and audio from a channel like CNN to any speaker in the house.
The MSO's parent company, AOL-Time Warner, could also have big plans in store to push the "AOL Anywhere" initiative, notes Sabharwal. "They're a provider that will likely be progressive on this front, but they'll look at it from a content perspective, too."