Your cable company may soon be your phone company, and vice versa.
But before they get there, both want to sell Web users on their high-speed Internet connections.The technology involved has the telecommunications industry and the cable business engaged in a vigorous foot-race to win customers to their high-speed Internet offering.
Copper phone lines being used for dial-up Internet connections at modem speeds of up to 56,000 bits per second, or 56 kilobits, are being retrained as DSL, or "digital subscriber lines," to handle both phone conversations and Internet connections at download speeds of several million bits per second.
Coax cable strung through Wasatch Front neighborhoods to deliver television programming is now capable of sending and receiving Internet data at speeds also reaching into the millions of bits, or megabits, per second.
Which is best? It depends on who you ask -- and where you live. Some existing cable networks can't yet handle the new Internet traffic, so cable Internet access is not yet offered. Potential DSL customers have to live within a certain radius of a phone company central office where DSL hardware is located.
It is almost certain both technologies will co-exist for some time and that they will remain the leading high-speed Internet conduits for the foreseeable future, which, in technology terms, may mean the end of next year.
"It's looking like a horse race," said Mike Rouleau, vice president of marketing for US WEST Interprise. He expects DSL and cable to lead the pack in high-speed Internet service for some time.
AT&T bought TCI and is pumping money into the cable network, recently spending $80 million to upgrade service to 100,000 homes in the northeast quadrant of Salt Lake City. Continuing upgrade will make additional television programming and high-speed cable Internet service and beefed-up cable television programming available to 350,000 homes by the end of next year.
US WEST rolled out its MegaBit DSL service in Utah in May 1998. Denver-based JATO Communications joined in as a competitor for DSL service two months ago. Rhythms NetConnections Inc., also from Colorado, just launched its offering of DSL-based services in the Salt Lake area.
AT&T is focusing on cable but plans to cover all the bases. The long-distance giant is offering dial-up Internet service, buying cable companies and creating a DSL re-seller as well. Randall Decker, AT&T Cable Services' regional marketing manager, said an AT&T-owned company will likely begin offering DSL service in Utah in early February.
Cable and DSL options offer Internet users an always-on service that doesn't require "connecting" each time it is used. The varying marketing approaches taken by each industry point out the differences in the service.
Predictable DSL service puts limits on the distance a customer can be from a central switching office.
One of the first questions potential DSL customers are asked when they call for service is "Where do you live?"
"We've tried to put down as broad a footprint as possible for DSL services," said Rouleau. "You're going to see us continue to deploy and put down new technologies that make that additional reach."
JATO general manager for Utah Jack McDonald said his company is marketing its DSL products primarily to businesses. Cable penetration is highest in residential neighborhoods, he observes. "But nobody is running cable past my building," located downtown on Main Street. "And they're not likely to run cable here."
Buying DSL service, with prices beginning at $19.95 per month from US WEST, is only half of the Internet connection. Customers still have to spend another $20 or so for an Internet service provider, which could be America Online or US WEST's own Internet service, USWest.net, or any of a number of Internet service providers.
Wasatch Front residents, or businesses, buying cable Internet service get a package deal that includes both the access and the Internet service for $39.95 per month but are limited to using AT&T's @Home service as their Internet service provider.
Download speed with cable Internet service fluctuates depending on the traffic on the cable company's network. While that makes the speed less predictable, customers get the best speed available for a flat-rate price, Decker said. DSL, on the other hand, provides more predictable speed but is priced according to the minimum speed the customer wants. MegaBit customers get 256 kilobytes per second for the base fee of $19.95. If they want 1 megabit upload and download speed, the fee is $120 per month; 7 megabit download and 1 megabit upload speed runs $840 per month.
Decker said AT&T's marketing focus involves bundling different services so customers only have one bill to pay each month. AT&T is pushing Internet services in the cable companies it buys because that is where cable technology is today. But AT&T bought cable companies as a way of getting back into the local telephone business.
"Pretty soon you'll start seeing AT&T trucks in the neighborhoods, something that hasn't happened since the (telephone monopoly) breakup," said Barb Shelley, AT&T Cable's regional communications director.
"Bundling is definitely part of the marketing mix," JATO's McDonald said. "We plan to offer access to the Internet and streaming video and all kinds of application that require bandwidth."
Bundling services to attract new customers is the first step in the crossover between phone and cable TV companies. Just as AT&T plans to offer local phone service soon through its cable networks, US WEST and others competing for space on the telephone network it inherited after the Bell System breakup have video entertainment in their plans.
US WEST is already offering video over DSL lines in Phoenix. "It's a cable TV-like service," Rouleau said. "We have not announced anything about expansion, but service is being widely deployed throughout the Phoenix area."