DSL Prime News: The Inside Source

Voice and even television over DSL are being deployed abroad, and the telcos may even allow it to happen in the U.S.

by Dave Burstein DSL Prime [December 4, 2003]

"We 'open' DSL television this week!"
—Xavier Niel of Free.Fr

10,000,000 Japanese have DSL, or will within a week or so. The world is learning from Masayoshi Son, whose world-beating $25 7 Mbps service is close to passing mighty NTT and is transforming the Japanese Internet. Free.fr and LDCOM are both following the Yahoo model, great speed, voice, and now video at a great price; the rest of Europe is deciding how to follow.

"I think we're now the world leader in DSL," Chang Xiaobing tells me, with a modesty backed on accomplishments and anticipation of more challenges to come. He's President of China Telecom, the largest telco in the world and by far the fastest growing. In DSL, they've gone from 1 million past 6 million in a year, and have indeed passed everyone else. Everyone successful in our business works hard, but the Asians are a step up in intensity. Xiaobing's traveling companions included a former Bell Labs researcher, not the usual hale fellows and golfing buddies other CEOs bring along.

The FCC VoIP hearing was "like Bizarro World on Seinfeld," a panelist writes. He was amazed the Bells were absent; apparently they are ready to let VoIP grow rapidly in the U.S. That's good news, although the rhetoric from Powell and others about "not taxing or regulating the Internet" is hollow. Looks like a quiet deal is cut, to require USF or similar, allow wiretaps, and extend E9-1-1.

I haven't thought through the major story implied by the hearing, that the Bells expect to use VoIP to blow up the U.S. access fee and regulatory system. I'm so far behind, I hope some other writer writes the story first. Apologies to the DSL Forum, PacketFront, Egypt and Iraqi Telecom, Masayoshi Son and others who have briefed me lately and not yet seen the stories I'm working on.

Comments particularly welcome on VDSL2, ADSL over 26 Mbps, improving WiFi performance, and replicating Yahoo BB in the U.S.

BRAS upgrade off at SBC
Cut from capex budget
SBC has delayed indefinitely buying $100 million of BRAS traffic control gear, LR reports. Two months ago, the momentum appeared unstoppable. However, the business case fell apart after Comcast raised the basic speed to three meg. SBC at the top realized they will have to raise speeds in return soon.

Suddenly, content delivery surcharges for 1.5 Mbps video couldn't be justified without implying the whole network was unreliable and over-hyped. Since that income was expected to pay for the system, losing the planned markup on video killed the cost-justification. Most bids were too high anyway, because the offered equipment was underpowered or over-priced. Copper Mountain was considerably more reasonable, and will be on any shortlist for this kind of gear.

The BRAS proposal was an ingenious way to stretch the existing network. But with cable at 3 Mbps and talking 20 or more, it's far too little to compete. SBC and Verizon are dedicating available capex to expanding the network and bringing in revenue.

Freebox Video
50 French TV channels
Order 30 Euro DSL service and you'll get the "Freebox." Supports a DSL network, of course, and SIP for VoIP. The Freebox video jack is no longer an appendage of wonder, with video now available. Paris is a natural market for video over DSL, because cable is weak and zoning regulations prohibit satellite dishes.

Here in the U.S., the telcos are missing an extraordinary opportunity to offer what cable doesn't. Just as Free offers programming in Russian and German, U.S. telcos can offer a range like this for the millions of Americans born elsewhere.

Masayoshi Son is ready to go to 140 channels. Digital cable today typically is 400—because DSL is switched, with the right network design you can soon have 5,000 available at your headend. Having a great service for your customers is the best way to sell.

Copyright 2003 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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