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page 7 of 7
Washington's
Bogeymen
When
terminals are smart, the intelligence in networks flows to the fringes.
When terminals are smart, networks must be broad and dumb. There is no
way that an intelligent switching fabric can anticipate the constantly
evolving technology emerging from a computer industry in a frenzied process
of change. There is no way that John Malone’s satellite farm outside
Denver will be able to satisfy the demands for programming and communications
of 100 million networked teleputers. While the telephone business struggles
with the increasing problems of intelligent central switches with some
25 million lines of software code, the cable industry is creating dumb
networks in tune with the explosive growth of supersmart machines in every
home and office.
The movement of computer networks onto cable need not await the development
of advanced broadband systems such as those planned by Time Warner in
Orlando. Already several companies are supplying moderns that allow computers
to link directly to cable systems.
Zenith provided the first system, HomeWorks, operating at a rate of 500
kilobits per second. It is being used by Cox Cable to deliver Prodigy
service in San Diego at a rate 52 times faster than existing 9,600-baud
phone modems. Also using HomeWorks is Jones Intercable for Internet services
in Alexandria, Va., Continental Cablevision and CompuServe in Exeter,
N.H., and TCI for a distance learning test in Provo, Utah.
Zenith is adding a system called ChannelMizer that can offer full Ethernet
capability of 10 megabits per second over a 15-mile radius. Intel, General
Instrument and Hybrid Technologies have announced an asymmetrical system
that runs upstream from the home at 256 kilobits per second and downstream
at 10 megabits per second, the Ethernet rate run in most office networks.
Pioneering in the field for several years has been Digital Equipment Corp.
under the leadership of James Albrycht. Adapting equipment developed by
LANcity, DEC’s ChannelWorks offers the functionality needed for true
information highway on-ramps. Extending a two-way Ethernet transparently
from the office to the home by a full 70 miles, the ChannelWorks frequency-agile
modem allows the use of all 83 cable frequency channels. Cable managers
can send digital information over any underused part of the coax bandwidth.
Currently deployed chiefly by telecommuting Digital employees, the system
is under evaluation by a variety of hospitals, libraries, schools and
other institutions favored by Vice-President Gore.
Absolutely crucial to the development of the broadband superhighway, however,
is not only the merger of the two networks but also access to the capital
of the telephone industry. Creation of high-bandwidth cable connections
to homes will be far cheaper than laying new coax. But they still will
require expensive upgrades to existing cable plant.
The telcos already invest more money every year—some $ 24 billion—than
the total revenues of the cable industry. But even the telcos will not
be able to create information superhighways if they also have to duplicate
the broadband connections to homes already offered by the cable industry.
Similarly, the cable industry alone cannot attract sufficient funds to
duplicate the broadband fiber networks already commanded by the telcos,
while the telcos move in to skim off the best pay-per-view movie markets.
Particularly in an adverse regulatory climate neither industry is capable
of building broadband networks. With relatively narrowband networks, the
Malone model necessarily thrives. In the name of fighting monsters the
administration is in fact pursuing what amounts to a monster-protection
policy.
If this policy continues, innovation once more will follow its course
toward the least-regulated arenas. Cable and telco firms will install
their best technologies overseas. In the U.S. the computer networking
industry will build the information superhighways. To Gore’s bitter
regret, only business and the wealthy will be able to afford access. Until
the early decades of the next century, much of the rest of the nation
will be left to the mercies of the Malone model for video entertainment
and other cable programming. Interactivity will tend to take the form
of games and pay-per-view TV.
Nonetheless, with the increasing movement of activity from big cities,
corporate headquarters, hospitals, schools and other centralized institutions
to homes and small cities, the demand for broadband computer connections
is sure to soar. Most current congressional legislation that imposes mandates
on businesses relating to everything from health care reform to parental
leave tends to drive work away from corporations to contractual outsources.
The market for “interactive TV” is likely to grow far more slowly
than the market for computer connections over cable.
Both political parties are far behind the public in comprehending these
developments. But the reversal of the earlier forces of conurbation and
centralized industry responds to the most profound laws of new technology.
It is the most important movement in America today. If the administration
continues to strangle new technology with new regulation and red tape,
a new coalition of liberals and conservatives alike will rise up against
it and grasp the future. Al Gore may eventually wish he had never heard
of broadband networks.
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