BBH Report Home Page
September 23, 2003 Provided by System Dynamics Inc.

IN THIS ISSUE:


Heard on the Net

News about People and Companies Influencing The Broadband Home


People News

Mitchell Berman has been appointed VP and chief marketing officer for Alopa Networks. ( www.alopa.com )

Brion Feinberg has been named Senior Director of Product Management & Marketing at Lemur Networks. Brion is a 20-year veteran of AT&T and Lucent Technologies. ( www.lemurnetworks.net )

Wes Hoffman has been named EVP and COO of OpenTV. He was previously CEO of ICTV. ( www.opentv.com )

Neil Isaacson has joined Ucentric Systems as its CFO. He was previously the founder and CFO of Cignal Global Communications. ( www.ucentric.com )

Mike McGrail has been named President and CEO of ICTV. ( www.ictv.com )

Steve Silva has joined Comcast Cable as VP of new business development. He was previously with Charter Communications. ( www.comcast.com )

Alan Walp has been named VP of Wireless Marketing and Sales for Europe, Middle East and Africa at CommScope. Previously he was with Radio Frequency Systems (RFS), a division of Alcatel. ( www.commscope.com )

Dave Weisman has been named CEO and board member of Eagle Broadband. ( www.eaglebroadband.com )


Company News

--Acquisitions

Arris completed the acquisition of the cable modem termination systems-related assets of COM21, including the stock of its Irish subsidiary, for $2.8 million. ( www.arrisi.com ) ( www.com21.com )

GlobespanVirata Inc. has acquired the WLAN chip business from Intersil Corp. for approximately $365 million in cash and stock. The deal includes Intersil's portfolio of PRISM IEEE 802.11 wireless local area networking products and intellectual property. ( www.virata.com ) ( www.intersil.com )

NDS Group is acquiring the MediaHighway business from Thomson for about $68 million. NDS and Thomson have agreed to a strategic alliance to provide NDS software solutions on Thomson's product portfolio including settops, modems and headend equipment. ( www.nds.com ) ( www.thomson.net/EN/home )

OpenTV has acquired BettingCorp Limited, a developer and operator of gaming and betting technology and services. BettingCorp's technology allows gaming and betting services operators to use Internet, iTV and wireless platforms with one back-end management system and a single user account. ( www.opentv.com ) ( www.BettingCorp.com )

--Funding

Core Networks closed a $5.7 million round of funding. ( www.corenetworks.com )

Jungo Software Technologies announced that the company has secured $5.5 million in a third round of funding. ( www.jungo.com )

--Other News

AT&T is currently trialing a VoIP solution called AT&T Consumer Digital Solutions (CDS). They are beta testing it in selected areas. ( beta.ataclick.com )

BellSouth and DirecTV announced their plans to offer a voice, video and data bundle. Press reports indicate the companies will explore combining satellite and DSL technology in an even closer collaboration. ( www.bellsouth.com ) ( www.directv.com )

Broadcom has started to ship the BCM4317 (aka AirForce One™ Chip), a single-chip 802.11b WLAN solution integrating the MAC, PHY, radio and power amplifier. Broadcom also announced two reference designs based on the 4317, both "barely the size of a U.S. postage stamp;" one combines 802.11b and Bluetooth in the same module. Broadcom says this chip will enable a new generation of wireless devices, since it is very small and requires very little power in standby mode. These are targeted to cellular phones, PDAs, digital cameras, and are aggressively priced with modules starting at $10 in 100,000 piece quantities. ( www.broadcom.com )

Cablevision has launched their new Optimum Voice service. Based on VoIP, the service is available to their Optimum Online broadband customers at a monthly rate of $34.95 for unlimited local and long distance calling. It is expected to be available to all of Cablevision's Optimum Online customers by year end. ( www.cablevision.com )

Ellacoya Networks announced availability of gENIOS, their operating system which allows broadband operators to enable IP service control for P2P applications across a carrier network, rather than on a box-by-box basis. ( www.ellacoya.com )

The National Rural Telecommunications Cooperative (NRTC) announced a distribution partnership in which their members will be able to offer WildBlue's two-way satellite broadband service in the continental U.S. NRTC is an investor in WildBlue; its membership includes over 1,100 rural telephone and electric companies. NRTC members will begin marketing the service to homes and small offices in 2004. ( www.nrtc.org ) ( www.wildblue.com )

PCTEL, Inc., a provider of wireless solutions and access technology, is incorporating its software solution with GlobespanVirata’s 802.11g and 802.11a, b & g WLAN technology (recently acquired from Intersil, see above). The resulting product converts a PC with a PRISM-based client device into a fully functional-access point (AP) with router capabilities. ( www.pctel.com ) ( www.virata.com ) ( www.intersil.com )

Portus has chosen ProSyst´s OSGi implementation, mBedded Server, for its DIAS advanced services gateway product. Portus is part of the HomeGenesis consortium that had earlier been awarded project support for trials in the Infocomm Development Authority of Singapore's (IDA) Connected Homes project. The IDA has selected five consortia to develop and trial their solutions in more than 400 households. ( www.portus.com.au ) ( www.prosyst.com ) ( www.osgi.org ) ( www.ida.gov.sg )

Skype, a new peer-to-peer Internet phone service, has been launched by Kazaa co-founders Janus Friis and Niklas Zennstrom. Skype announced release of its Beta 0.92 available in Danish, Dutch, English, Estonian, French, German, Portuguese and Swedish. ( www.skype.com )


Briefly Noted

Wireless Video: Daewoo announced their entry into the wireless home entertainment market at the IFA Consumer Electronics show in Berlin. Daewoo is working with ViXS to develop technologies and products for streaming high-quality video over local area networks. The video networking technology provides guaranteed 30 frames per second wireless delivery of multiple standard and high-definition (HD) video streams over an 802.11a network throughout a home. The first product in development is a point-to-point media access device. ViXS previously conducted HDTV demos with Sony and NEC to highlight wireless video capabilities that will soon be available to consumers. ( www.daewoo-electronics.com ) ( www.vixs.com )

News from IDF: The Intel Developer Forum (IDF) is a guide to the topics Intel will be pursuing over the coming months. This year's Forum included focus on the digital home and development of industry specifications for sharing content across multiple devices thru involvement with organizations like the Digital Home Working Group. Also notable is the development of Digital Transmission Content Protection, over Internet Protocol (DTCP/IP) technology. Co-developed by Intel and Hitachi, Toshiba, Sony and Matsushita (Panasonic), it enables home users to share protected entertainment content among a variety of digital devices in the home. Another new technology available from Intel in mid-2004 will simplify home networking by including a wireless access point and router functionality as an embedded feature of the PC. Intel also demonstrated next-generation digital media adapters (DMAs), devices that transfer personal digital video, photos and music from a PC to a TV and a stereo; the DMAs included iCube's Play@TV and Lenovo's Media Link. ( www.intel.com/idf ) ( www.dhwg.org ) ( www.dtcp.com ) ( www.icube.co.kr/eng ) ( www.legendgrp.com )

US-- The Federal Communications Commission (FCC) unanimously approved rules for digital cable plug-and-play interoperability between digital cable services and consumer electronics products. The decision is timely for TV manufacturers planing for production of 2004 HDTVs, which can be equipped with uni-directional digital-cable-ready capability. The approval contained minor changes to the agreement reached previously by consumer electronics manufacturers and the cable industry. ( www.fcc.gov )

Cable versus DSL in North America: In the September issue of Cable Datacom News, Kinetic Strategies reported that "the total number of residential cable modem and DSL subscribers in the U.S. topped the 20-million mark in the second quarter of 2003. Including Canadian subscribers, the total residential broadband installed base in North America reached 23.9 million as of June 30, 2003." Kinetic observed that US cable operators' "share of broadband subscriber additions fell to 63.2% in Q2 2003 from 68.5% in Q2 2002." However, US cable operators still have over 66% of the residential broadband market and Canadian MSOs have about 57%. ( www.cabledatacomnews.com )


Broadband World Forum -- It Takes More Than Bandwidth

The Broadband World Forum which we attended earlier this month is heavily weighted toward its history as the "DSL World Forum". Since DSL is much stronger than cable nearly everywhere but North America, it's understandable that many people view DSL and broadband as synonymous.

At the event, the DSL Forum in conjunction with Point Topic released its latest figures on DSL subscribers worldwide: "As of 30 June 2003 the total is 46.7 million. Western Europe showed the greatest six-month growth with 12.8 million homes and businesses are now using broadband DSL. The Asia-Pacific region has the greatest number, at 17.8 million subscribers. The DSL Forum has set a target for a global mass market for broadband DSL – 20% of all phone lines – 200m subscribers by the end of 2005. South Korea remains the only country in the world to have achieved mass market status with 29.7% of its phone lines delivering DSL services."

Despite their historical DSL focus, we applaud the IEC conference organizers for their inclusion of other perspectives on broadband, including those from cable operators, fixed wireless providers and fiber-based service providers.


Conflicting Messages?

Before telling you what we heard, we'd like to note that we've read reports by some of our colleagues about the conference. Doing so made us understand more than ever that "things are in the eye of the beholder". For example, Dave Burstein wrote in his September 18th DSL Prime report about his "wonderful conclusions" that: "Speeds delivered to customers can easy double"; "Operating costs can be cut in half"; "Growth will be explosive"; "Deployment is 90% solved" and that "Jong-Lok Yoon of KT inspired me with their accomplishments, Ben Verwaayen of BT with their plans, and John Cioffi of Stanford with the possibilities he's opened up."

Although we heard some of the same talks, the strongest message we came away with was that most providers are still struggling with how to move beyond selling faster speeds and into applications that captivate consumers and drive profitability. Just moving to faster speeds is far from enough and unless revenues can more than cover the costs of the upgrades, the pursuit of more bandwidth may be a trap.

One version of this message came from Martin Harriman, Chief Marketing Officer of Marconi. Referring to today's "all you can eat" bandwidth model, he asked "How can we constrain the genie we let out of the bottle?" We repeatedly heard about service providers' quest for how to deliver services beyond connectivity and Internet access and bill for them on some usage or value-added basis. The quest for ARPU and how to mine the value of bandwidth seemed nearly universal.


Making Money from Megabytes

Many sessions included talks on how service providers are working to mine the value of bandwidth (and QoS and more) and collect additional revenues. Here are some of the ideas we heard:

  • Tiered services
  • Lower latency and higher speeds bundled into online gaming services
  • Providing value added services such as music subscription or digital photography
  • Providing video on demand, to both the PC and the TV
  • Offering hotspot access in addition to home broadband access
  • More generalized fixed/mobile broadband convergence (not just from hotspots)
  • Personal Web storage
  • Virus protection services
  • Filtering services against adult content/parental controls
  • Providing telephony bundles as an option (like those from Free Telecom discussed below)
  • Providing additional bandwidth on demand either as pure bandwidth or in conjunction with specific applications
  • Providing a fixed IP address
  • VPN services
  • Offering video communications
  • Offering and supporting home networking

Watching KT and their broadband leadership in Korea (where 70% of homes have broadband) may provide some clues to how various new services are succeeding, but we believe the real message from them was not to copy their offerings (some of which may be unique to their culture) but to emulate their devotion to listening to their customers. The service that struck us as their most unusual was "protecting against Internet addiction" for which they charge $3 additional per month. In Korea it appears that Internet addiction is serious enough that there have been multiple organizations formed to cope with its risks.

The KT service, Megapass Timecodi, monitors the hours a child (or other person) consumes on the Internet. The time limit is set either by the user themselves or by parents or others helping the user control their behavior. When the specified duration has elapsed, the user is notified and redirected to the service page. We don't know how this would fly in other countries, but think it's a lovely business proposition to get customers to pay more each month to limit the amount of service they can use!


Home Networking

The Forum held several sessions related to home networking. Sandy spoke in one called "Broadband Home Network Architectures: The Digital Home" (http://www.iec.org/events/2003/bbwf/attendees/d3.html), chaired by Nancy Goguen of TI. Both Nancy's talk and that of her colleague Joe Crupi touched upon consumer's lifestyle needs for entertainment, productivity, home automation and connectivity. Nancy spoke about how the quest to understand user applications is key to profitability for broadband service providers. She also focused on how "residential gateways" are evolving to fit these needs and applications. On the exhibit floor, TI displayed some of the components which form the foundation for such gateways (see picture).

Sandy's talk "The Broadband Home: It’s Hard to Make It Easy" (http://www.broadbandhomecentral.com/presentations/BBWF2003.ppt) came from two perspectives: one as a consultant to broadband companies, the other as an intensive broadband user who lives in a very networked home. Part of the message is that today's home generally consists of numerous technology "islands" (TV, PC and computer networking, phone, lighting, HVAC, audio, photography, and more) with lots of legacy equipment as well as new digital devices. There are multiple efforts underway to bridge these. Her caution was that service providers should try to solve manageable pieces. One of the lessons learned from "advanced set-top boxes" in the cable industry was that attempts to put too many functions in a single centralized unit inevitably failed due to Moore's law. She indicated her belief that this lesson is equally applicable to trying to integrate too many functions into centralized residential gateways. Leveraging the efforts of the PC and CE industries and learning from/cooperating with other industry efforts are both important.

Ofer Vilenski, CEO of Jungo Software focused on intelligent software as the answer to simplifying ("zero configuration") home networking. He spelled out some of the technical challenges and Jungo's progress in overcoming them. Jungo's OpenRG residential gateway software is currently integrated into access devices from vendors such as Toshiba and U.S. Robotics. We have met with Ofer and Jungo previously and are impressed with their progress. We agreed to trial one of Jungo's gateways and see which system administrator headaches it cures for us.

Jay Fausch of Alcatel concluded the session by focusing on the contributions that must come from the network equipment. As Chair of the Marketing Committee of the DSL Forum, he also mentioned the work this group is doing on their DSL Home Initiative.


How's Competition Doing?

There was a fine line-up of speakers from incumbent telecom companies at the conference, including BT, France Telecom, Deutsche Telecom, Korea Telecom, Telefónica de España and Telecom Italia. However, since we're strong believers in the power of competition to spur innovation and better value for consumers, we'll focus more on what we heard from some of the insurgents.

As residents of the US, where cable operators and telephone companies fight head-to-head for broadband customers, we have noticed the lack of a strong alternative to the incumbent telephone providers in Europe. The financial woes of many European cable operators cast some doubt about having the resources to wage a strong battle against the former PTTs. The UK's Telewest and ntl had an early start and together have about the same number of broadband (cable) subscribers as BT's (ADSL) subscribers. But with BT having gotten really serious about broadband in the past year, and its much greater population coverage, the MSOs have a tough battle ahead. More about Telewest and BT below.

Voice over DSL

In a session on deploying voice in an unbundled local loop, we heard from three competitive providers. All said they were EBITDA positive, despite difficulties with the incumbent and regulatory matters.

Ike Knuivers represented Versatel, which started as a reseller of voice minutes in 1995. Versatel began building their own network in 1997 and now has over 1 million customers in Belgium, Germany and the Netherlands; it is the largest alternative provider of DSL-based services in The Netherlands. Although their initial focus was the small and medium enterprise customer, they have now captured 10% of the consumer data market in the Netherlands. Their Zon Broadband Budget service, which provides 256/64 Kbps, costs just € 14.95 per month. They have a range of tiered residential offerings which go up to 2048/320 Kbps for € 83,87. They have now moved into voice because they see more money there than in Internet services. Their initial voice over DSL service is ATM-based.

Serge Lupas, from Cybercity in Denmark, explained that they have not yet moved into voice, although they are examining the how, what and when of VoIP. Cybercity is the number two ISP and DSL provider in Denmark, after the incumbent TDC. They have distinguished themselves from the incumbent by such features as boostable bandwidth on demand for their users. They have also focused on providing services to businesses that want to enable their employees to work at home.

The third competitive provider was Free Telecom, represented by their COO, Michael Boukobza, whom we also had the opportunity to meet with privately. Free, a subsidiary of the iliad group and founded in April 1999, is second in French ISP market share behind the incumbent service, Wanadoo. As covered in last month's broadband Home Report (http://www.broadbandhomecentral.com/report/backissues/Report0308_5.html), Free recently introduced free VoIP phone calls to all their DSL subscribers until the end of 2003. Free had already been differentiating themselves from their competitors by giving 2 megabit service and a fixed IP address. Adding voice is at the heart of their expansion strategy and has been facilitated by capabilities already in the "freebox" which comes with their high speed data service.

Cirpack's CTO, Frederic Potter, moderated the session featuring these three competitive players, and we took the opportunity to meet with him. Cirpack got our attention after Free Telecom selected their voice switching equipment. Potter told us that Cirpack's equipment is deployed in 15 service providers, usually alternative carriers; he said their systems serve over 1 billion minutes per month and exceed 5 nines availability. The company has been cash flow positive for 2 years. Their credentials seem quite positive and we give them credit for being the "David" against such "Goliath" competitors as Marconi, Siemens and Ericsson.

Fastweb Update

In another session and follow-up conversation with Mario Mella, Network Planning Director of Italy's Fastweb, we had a chance to catch up on their latest progress. As we have previously reported (http://www.broadbandhomecentral.com/report/backissues/Report0303_6.html), Fastweb is Italy’s main alternative fixed broadband telecom operator, deploying fiber to each building. They now pass over 90% of the buildings in Milan with their fiber. Back in July, they signed an agreement with Telecom Italia to sell their Hamburg, Germany broadband telecommunications provider HanseNet for over € 250 million, and are using the proceeds to concentrate on the expansion of FastWeb in Italy.

Since they are active in six Italian cities, a substantial portion of their customers (45%) are being served via DSL connections awaiting fiber installation. Their most recent announcement was to make accessible to these DSL-served clients all the television services already available to their fiber customers. Their ADSL connection speed is up to 4 Mbps downstream (up to 512 Kbps upstream). Their TV services to DSL clients are provided by multicast over DSL and include 120 channels. This newly launched service is an example of Fastweb pioneering the use of a new technology (which is being supplied by Marconi).


Emerging DSL Technologies

We attended a great session on recent advances in DSL technologies, and came away with mixed feelings. On the one hand, it's impressive how much bandwidth these technologies promise to extract from copper wires designed for analog voice. On the other hand, DSL standards seem to be multiplying faster than phone companies can deploy them, and it's hard to see how phone companies can choose between the rapidly-expanding choices.

The session was called Advancing DSL: Driving the Technology That Delivers the Bandwidth (http://www.iec.org/events/2003/bbwf/attendees/c4.html) and included many of the leading architects of DSL standards (including John Cioffi of Stanford University, Kevin Foster of BTexact Technologies and Massimo Sorbara of GlobespanVirata). We learned about the many technologies that are following from the now-familiar ADSL deployed by many phone companies, and the many problems that arise from having different technologies within the same copper bundle going different distances from the DSLAM to the customer premises. By the time it was over, we immediately understood that "advanced shidzull" meant emerging standards for single-pair high bit-rate DSL (SHDSL), a relatively new form of symmetric DSL.

Here's some of what we learned:

  • There are multiple emerging standards--recently approved or in development--for all "flavors" of DSL: ADSL (asymmetric), SDSL (symmetric) and VDSL (very high speed and intended for video). Compared to earlier standards, these provide better "range/rate" performance, with higher speeds and longer loop lengths. Some of these use multiple lines, or can combine groups of lines, to get better range/rate performance.
  • SDSL is generally viewed as most appropriate for business customers, replacing older T1/E1 leased lines with higher-speed lines that can be configured for either traditional TDM services or for native ATM or Ethernet.
  • ADSL is most appropriate for residential customers. The newer flavors of ADSL (ADSL2 and ADSL2+) are in competition for range/rate with VDSL.
  • Running multiple DSL lines in the same bundle (typically 25 or 50 copper pairs) creates interference or "crosstalk" between them. There is additional crosstalk if the lines use different DSL technologies, and especially if a single bundle includes some pairs driven by DSLAMs at a central office and some driven from remote terminals.
  • The normal way of coping with crosstalk is to preset each line's transmit power levels based on worst-case crosstalk scenarios. But the result can be sharply reduced range/rate.
  • An emerging technique called Dynamic Spectrum Management (DSM) can markedly improve range/rate. It operates first by adjusting each added line's operation for the actual mix of technologies already in the bundle, and later by having a central controller dynamically optimize the settings for each line. See the excellent work on DSM by John Cioffi (http://www-isl.stanford.edu/~cioffi/dsm/index.html) and his colleagues at Stanford University.
  • The same signals that create crosstalk between lines are also a potential source of external electromagnetic radiation. DSL operates on a physical plant designed for analog voice and based on copper pairs "installed in 1874 or 2003" (as one standards presentation put it), and it's hard to avoid external radiation when you run MHz signals. Proposed new European EMC standards may require limiting power and reducing the range/rate.

By the end of the session, we realized that none of the participants had observed that fiber could solve a lot of these problems. It can provide any speed of service anyone might want and lots of range. Fibers don't interfere with each other, and don't emit any radiation.

It's expensive to tear up existing copper, of course, and fiber certainly can't be built overnight. But we wonder how many phone companies are considering the plethora of emerging DSL choices and the complexity of spectrum and radiation management--and thinking how much simpler fiber would be.


What About Wireless?

In the conference session titled "Wireless Broadband IP Everywhere: Is it Real?" the speakers answered the question with a resounding yes. David Brunnen, Founder and Managing Director of ABFL, whose background includes many contributions at BT, gave a humorous look at headlines of the future and how broadband wireless everywhere will shape them. Other presentations by Dave James of Oak and Gilad Peleg of Alvarion would sound familiar to those who have read our recent articles (http://www.broadbandhomecentral.com/report/backissues/Report0308_4.html) about Broadband Anywhere and the role of broadband wireless services.

During the session, one of the speakers asked the question: "Does anyone (in the audience) still believe in 3G?". Of course the phrasing was a bit loaded, and no one raised their hands. The subject of 3G and its role in the wireless broadband future was one we discussed in many of our meetings. It's a contentious and complicated topic, which we'll simply mention here as one more piece of the complex broadband puzzle.

( www.iec.org/events/2003/bbwf ) ( www.dslforum.org ) ( www.point-topic.com ) ( www.dslprime.com ) ( www.marconi.com ) ( www.kt.co.kr ) ( timecodi.megapass.net ) ( www.ti.com/broadband ) ( www.jungo.com ) ( www.alcatel.com ) ( www.versatel.com ) ( www.cybercity.com ) ( www.free.fr ) ( www.iliadtelecom.com ) ( www.cirpack.com ) ( www.ebiscom.it ) ( www.abfl.co.uk )


Catching Up on "Broadband Britain"

It has been three years since we last spent time immersing ourselves in Britain's broadband scene, and it would be an understatement to say that things have changed radically since then. In August 2000 we wrote about that visit in an article called "Broadband in the UK -- Focus on the TV" (http://www.broadbandhomecentral.com/report/backissues/Report0008.html). At the time, there was a widespread belief in the UK that "the TV rather than the PC will be the primary interactive platform in many households."

Today, broadband in the UK unequivocally means the PC, which arrived in force over the past few years. According to Oftel's May 2003 residential survey (http://www.oftel.gov.uk/publications/research/2003/q13intr0703.htm), 58% of UK homes have a PC and 47% UK homes have Internet access. It's not that interactive TV has gone away, but rather that PCs have been added into the mix. We saw them in use everywhere, including on the underground. Department stores had large sections full of them and cafes and fast food spots with Wi-Fi access were quite common in London (picture).

Before we travel outside the U.S., we try to contact some of our readers in the area we'll be visiting. It gives us a great opportunity to learn what others are doing and thinking and about some regional and cultural differences that affect broadband adoption and applications. Here's a brief rundown on three out of the many meetings we had with our readers during our stay in London and Cambridge.


Telewest - Getting the Most From Their Assets

British cable operators Telewest and ntl had to restructure their finances after making heavy investments in buying and upgrading cable networks during the height of the market; last week, Telewest announced that it had finally reached agreement with the ad hoc committee of its bondholders to allow the company to go forward with a debt-for-equity restructuring. Against this squeezed financial backdrop, we had the opportunity to meet with a couple of our readers, Ed Allfrey and Fergal Butler, at Telewest's Technical Strategy department in Woking, outside of London. Our visit included seeing Telewest's home of the future, where they demonstrate the products and broadband services they are looking to bring to market in the future.

During our several hour visit we buzzed through multiple topics. In the TV services arena, the focus was on what Telewest can do to differentiate themselves from satellite. We saw the new user interface for their Digital TV service (see picture) and some upcoming digital TV services.

Broadband in the UK is very competitive, with the cable operators and BT sharing the market nearly equally. Telewest noted that BT currently offers only 512K service, while Telewest's "blueyonder broadband" gives the user a choice of 1/2, 1 and 2 Mbps service. Of their 340,000+ customers, approximately 40,000 are now subscribing to the premium 1Mb and 2Mb services.

Home Networking

In our discussion with Ed, and also in a session at BWF with Chad Raube, Telewest's Director of Internet Services, we heard about their range of offerings for home networking to address what they say are the 22% of consumers who now have more than one PC. Their offers start at the lowest rung aiming at digital TV subscribers who haven't yet upgraded to broadband.

Telewest has 1.2 million digital set-tops with embedded DOCSIS cable modems, and now offers a "wireless broadband self-installation pack" which enables users to upgrade to broadband without any truck roll. It includes a Netgear wireless access point and costs £35. The access point plugs directly into the customer's cable set-top box, creating a Wi-Fi link between the set-top box and a desktop or laptop PC; the current kit only allows one device to be connected.

Other networking packs include one for on-line gamers which connects an X-Box or PS2. Their more complete home networking proposition is "coming soon".

DVB-IP

One interesting subject we didn't have time to fully pursue was the DVB-IP plans they are currently formulating. Telewest believes the provision of downstream IP data over DVB-IP can dramatically reduce cost, release huge downstream bandwidth, and enable the provision of new services in a cable network. It is based upon the observation that "the advent of cheap IP QAM modulators for the delivery of VoD type services in a cable network has produced downstream data that is between 10 & 20 times cheaper than traditional cable-modem bandwidth. The encapsulation of IP into this bandwidth means that bandwidth which is today utilised for Analogue TV may be utilised for the delivery of IP data services (such as internet access) to the home, at extremely high speed and low price."

Their work rests upon the premise that customers will want and continue to have need for a highly asymmetric network. The goal is to migrate from today's world where VoD and broadband internet are carried over different channels and technologies to tomorrow's platform in which everything is carried over one set of IP resources. We were intrigued with the discussion and intend to delve deeper into its plausibility. We'd be glad to refer anyone interested directly to Ed Allfrey at Telewest.

While we saw lots of good work in our meeting, other analysts expressed doubt that Telewest has the financial wherewithal to invest sufficiently in both infrastructure and the customer service that will be needed to overcome some of users' reactions to their cable operators. Since we're fans of competition, we wish them well.

( www.telewest.co.uk ) ( www.ntl.com ) ( www.netgear.com )


BT - Late, But Moving Now

BT was late in bringing broadband to its customers, and the cable companies got most of the early subscribers. BT is now making a real impact in the UK. It offers ADSL on a wholesale basis, with more than 100 ISPs selling at retail. It also sells at retail, and earlier this month announced a joint effort with Yahoo! to launch BT Yahoo! Broadband.

During a meeting with Paul Blacker, head of Broadband Strategy at BT (another reader of this report who also spoke at BWF), we learned that BT may have now passed cable in terms of number of broadband subscribers in England. It reached one million wholesale users in June and is adding 25,000 lines per week. Although their announcements indicate that broadband DSL is available to "exchanges serving 80 per cent of UK homes", we don't know how that translates to the actual percent of homes which can get the service. From the number of people we met who are unable to receive any broadband service, it appears they still have some way to go.

BT currently has two home networking packages to choose from; Home Networking 1200 (which looks like a 2Wire Gateway) and Voyager 2000 which provides wireless home networking. They said they are "working on" new home networking solutions but were reluctant to share specifics with us.

Outside BT Headquarters in London, we were struck by the long heritage of BT when we noticed a plaque commemorating the site as the location from which Guglielmo Marconi made the first public transmission of wireless signals in 1896. Just a few steps away was one of BT's new broadband phone booths, where a video crew was filming BT's promotional campaign to encourage their use. We heard lots about how much BT has moved beyond the past and into the broadband future. We were impressed with some of the BT people we met, but are waiting to see how their next steps match up with their customers' needs and competitors' services.

( www.bt.com )


SatDrive - Broadband over Satellite

We have been rather skeptical of broadband services delivered over satellite. A satellite transponder is a great way to deliver television to lots of people simultaneously, but its limited capacity (typically around 36 Mbps) makes it difficult for an individual user to get much bandwidth as more and more users sign up and share it. Cable modems have a similar problem, but satellites have a "footprint" measured in countries while cable modems cover neighborhoods. And it's easy for a cable operator to add another channel, while another transponder typically costs millions of dollars a year.

So we were quite intrigued when David Brunnen of ABFL pointed us to SatDrive, a UK satellite service (offered in other parts of Europe under the name SkyDSL) and suggested we look at the way they allocate satellite bandwidth, allowing individual users to pay for higher priorities and therefore faster operation.

We had exchanged email with Eoin Lambkin, the Managing Director of SatDrive, before we left for the UK, and were delighted to have dinner with Eoin and David in London during our visit. Eoin (pronounced "Owen") told us that he had been involved in the development of the SkyDSL satellite service for TELES AG, based in Berlin, and had decided to market the service in the UK and Ireland under the "SatDrive" name.

SkyDSL now has 6000 subscribers of which 500 are in the UK and Ireland, mostly located in areas that cannot receive ADSL or cable broadband service. Since the satellite is "one-way", the return path is by dial-up modem or ISDN (which is widely available in Europe).

SkyDSL/SatDrive has a very clever way of allocating satellite bandwidth. First, it divides the users into priority groups ranging from 1 (lowest) to 6 (highest). For all users in group 1, it uses a "Fairness Guarantee" to allocate bandwidth among the users; within this group, "Fair Surfers" get a higher priority than users attempting to "hog" the bandwidth with heavy downloads. Users with priorities 2 through 6 get increasingly higher priority in use of the satellite bandwidth.

SkyDSL provides a real-time monitor (http://service.skydsl.de/monitor/) showing the actual average available bandwidth in each priority on a per-customer basis. These are shown on both a 24-hour basis (updated every 5 minutes) and a weekly basis (updated every hour).

The standard monthly service fee for SatDrive is priced at 14.99 BP/month with unlimited use of priority level 1; this is intended for web surfing with "light downloading". When users want to download, they can purchase higher priority levels, at an incremental price of 3 to 19 pence per Megabyte; the priority level can be adjusted up or down at any time.

This combination of discrete priority pricing with a real-time display of available bandwidth at each priority level acts as an instantaneous auction of the transponder capacity. Users with low willingness-to-pay can shift their downloads to the middle of the night when more bandwidth is available at level 1. Users who want to complete downloads fast can pay to push their priority up in steps until they get the speed they want.

Here's an example of how this worked during peak periods last week: "Fair surfers" in priority 1 generally averaged about 500-600 Kbps during the week and about 300 Kbps during the weekend, while "Heavy Downloaders" averaged about 50-100 Kbps. Priority 2 averaged about 600-900 Kbps, while Priority 6 averaged 10-14 Mbps. The longest and heaviest peaks are over weekends, with shorter peaks on weekend evenings. All speeds are higher in non-peak periods.

Eion says the monitor site has become a great sales aid: "Don't believe me I'm a salesman go look at this site to see what you will actually get". We asked whether transponder capacity would be an issue, and he told us that they expect to be able to obtain additional transponders as required to meet user demand.

We have not seen a "bandwidth auction" scheme like this before, and think it's a very nice way to give users a choice when competing for broadband resources. It would work equally well for other shared resources such as cable and wireless.

( www.abfl.co.uk ) ( www.satdrive.com ) ( www.skydsl.de )

We'd like to thank others we met with, including Jason Mauricio and his colleagues at Arete Research; James Brocklebank of Advent International; Steve Semelsberger and his colleagues at Motive; Mark Main of Ovum; Russell Haggar of Prelude Ventures; and Rod Newing of the FT. We had interesting discussions with all, and thank them for their insights into broadband progress in the UK and Europe.

( www.arete.net ) ( www.adventinternational.com ) ( www.motive.com ) ( www.ovum.com ) ( www.prelude-ventures.com ) ( www.ft.com )


Home-based Health Services: Telefónica’s Pilot

A Guest Article by Ana Altadill Arregui, Víctor Manuel García Muñoz, Miriam Ibáñez Lequerica, Jose María Montero Cebrián, Ana María Ruiz Blanco and Jesús Felipe Lobo Poyo

Note from the Editors: In our June visit to Spain, we had the opportunity to see Telefónica’s "Hogar Digital" and to hear about some of the Engineering and Development (TID) organization’s projects. Their home-based health services project is in operation today with actual patients. The Telefónica authors kindly agreed to provide an overview of the project’s goals and its conclusions to date.

Also see the "Author Biographies" (http://www.broadbandhomecentral.com/report/backissues/0309bios.html) page.


Introduction

Home-based Health Services are expected to be a key factor in the evolution of health systems. The use of new information technologies can allow end users to obtain health care and social services at any location, erasing many obstacles from current health services and creating a universal service everybody can access.

Home-based Health Services need to bridge the differences between the various health assistance layers in order to introduce health assistance in the patient’s house. The integration of the house and a hospital, or any other health institution, into a coherent health assistance scenario clearly involves big technological and organizational challenges.

In this new scenario, personal communications, remote monitoring and surveillance are going to be the most relevant Home-based Health Services for remotely controlling the patient’s condition. It is important to recognize that a significant portion of the users of such services will be lonely elderly people or patients who live in a location where access to health facilities is limited. These people may also have some handicap or illness which makes it difficult and uncomfortable for them to move from one place to another.

Because the patient is being supervised by the hospital, these services require a new remote vital signs controller system and some integration with the hospital’s information systems. For example, the system should be able to use a remote glucometer to measure the glucose of a diabetic patient, and integrate this data within the hospital database.


Telefónica’s Role

Telefónica, the main Spanish telco operator, in collaboration with the Hospital Clínico San Carlos (HCSC), one of the biggest public hospitals in Madrid, has developed a Home-based Hospitalization Service. It is part of the Hogar.es project, an innovation project partially originated by the Spanish Administration. The project began in September 2000 and will finish at the end of 2003.

The main near-term goal of Hogar.es is to provide the infrastructure for a “Connected House” or “Digital Home” in which multiple advanced services can be easily deployed. Hogar.es has chosen an OSGi architecture Open Services Gateway Initiative (http://www.osgi.org) which is based on the existence of a Residential Gateway at home as the appropriate platform to enable the provisioning of advanced services from different providers in an integrated way.

Within the project a set of services based on the platform have been developed. These services include home control, surveillance, information services, data services, remote-assistance, e-learning and home hospitalization

The project results are being evaluated by means of field trials with real users in approximately 30 houses/flats. This pilot experience, including three volunteer patients remotely assisted from the HCSC, is currently underway and will last until the end of 2003.


Home Hospitalization Service of the "Hospital Clínico San Carlos"

The former service

The development of the home hospitalization services in Spain has been prompted by two needs. On one hand, the users of the Public Health System are asking for a more responsive and humane service, and on the other hand, the managers of public hospitals are looking for ways to reduce expenses without reducing the quality of care.

Thus, the two main objectives of the home hospitalization are: to treat the patient within his/her own environment with the same quality and doctors as if he/she were at the hospital and to optimize the costs involved in long-term treatment of the patient.

Until now, there have been about 40 available home hospitalization units in hospitals all around Spain, including the HCSC. The medical staff uses portable medical equipment which is carried to every patient home each day for the doctor’s visit. A personal communication channel could be established between the doctors and patients with the support of cellular phones.

In order to participate, the patient and their family must want to participate, have a suitable caregiver and appropriate physical conditions within the home.

Advantages of the new service

HCSC intends to use the new service to improve the attention offered to their patients at home, increase the number of patients that take part in the Home Hospitalization Plan and increase the variety of pathologies that can be treated at home.

In order to suit HCSC’s specific needs, the Home Hospitalization Service was designed with the direct support of their medical staff, satisfying the following criteria:

  • Availability of hospital information for the doctor from the patients home
  • Reduction of medical visits to the patients
  • Remote control of medical devices
  • Profile support for different type of users
  • Security
  • Customization of the application depending on the user


System description

The service is based on the OSGI-compliant architecture developed within the Hogar.es project. This architecture provides platform independence, interoperability with other services, modularity/scalability, ease of administration and remote administration.

See the "System Architecture" page (http://www.broadbandhomecentral.com/report/backissues/0309architecture.html) for diagrams and a description of the system architecture and the equipment installed in the users’ homes.

The system was designed to meet the following requirements

  • Mobility: The service should be accessible for any authorized user from any device with an Internet connection.
  • Customized Access with different profiles: It defines several profiles for the application (medical personnel, nursery, patient or relative).
  • Security: Users are authorized by the hospital’s Computer department; system is accessed via a user and password mechanism; all communication between the hospital and the patient’s house is established using IPSec and VPNs;. firewall in the residential gateway at the patient’s home as well as in the hospital.
  • Adaptability: Allows configuration and application visibility on-line.

Trial experience

The trial is being developed in collaboration with the Hospital Clínico San Carlos and their home-based hospitalization department.

The department’s medical staff is composed of doctors, nurses and an administrative assistant of varying ages. All doctors are currently moderate users of the Internet (about 12 hours a week), however only one nurse uses the Internet occasionally.

The department has chosen three patients of different ages with chronic pathologies. The eldest is not in contact with the new technologies at all; the youngest is quite interactive, has a PC and is usually connected to Internet

All users in the trial have an ADSL connection which is appropriate because it is “always on” and is suitable for videoconferencing. All measurements done at the patient's home (usually with the help of a caregiver) are sent automatically to the hospital and immediately integrated with the existing patient data, so the entire medical staff has them available for queries.


Home-based Hospitalization Service description

This system includes the hardware infrastructure and all the services needed to assure the surveillance and control of the patients at home. In addition, it offers an integrated view of the medical data of the patient for any authorized user, inside and outside the hospital. Each user of the system has a customized application that suits his or her own needs.

The patient can access the information that doctors and other medical staff make available for him (e.g: diet, medications…). For the medical staff this service is a query tool, integrated with many information systems of the hospital so that they are able to have all the information from a patient accessible from a single tool.


Main screen of the service

The main modules of this system are the following:

Remote monitoring

This is one of the key features of the service. It uses medical devices located at the patient's home. These devices send their measurements in a secure way to the hospital, where they are integrated within the data of the patient. The patient’s glucose level, blood oxidation level, blood pressure, heart rate and gas components of the breathing can be measured with different devices remotely.

One of the advantages of using OSGi is the ability to extend the remote measurement capabilities by integrating new medical devices, whose main requirement is to have a communication port (like USB).


Interface for remotely controlling the home devices

The end user’s access to the devices is accomplished through a map which represents the home. In Hogar.es the device control service is the same for any device, such as the medical devices, surveillance cameras and motion detectors.

Integration with other applications of the hospital

One important requirement of the Home-based Hospitalization Service is its integration with existing applications, so that the home hospitalization staff can access various applications in an integrated way. These applications include: Patient data; Pharmacy; Appointment management; Radiology; and Diet.

Patient diary

This is an electronic agenda which contains all relevant information about the patient. It can be checked by the patient or the medical staff, although the patient has read-only access to the data whereas the medical staff can modify the contents. It contains Personal data; Medical tests; Treatments: Emergency Contacts; Appointments and Medication Reminders and Warnings (which uses a flashing light installed at the patient's home).


Attitude towards the system

In order to determine the reactions of all trial participants, both structured interviews and questionnaires were employed with doctors, nurses and patients. The responses to these surveys are summarized below; more information is contained in the "Attitude Surveys" page (http://www.broadbandhomecentral.com/report/backissues/0309attitudes.html).

Doctors and Nurses

The medical staff felt the Home Hospitalization Service will save time and travel to the patients homes, making their tasks easier and more effective.

Remote monitoring and videoconferencing were considered a great improvement. Previously, the only available way to communicate with the patients was a cellular phone. The medical staff thought the service both improves patient monitoring and reduces the number of patient visits. Some visits are still necessary, however, since physical presence cannot be completely replaced by videoconferencing, particularly for some emotional aspects.

The surveys showed significant differences in perceptions of usefulness between doctors and nurses, which seems related to the work they have to accomplish. For example, radiology– used almost exclusively by doctors—is scored very high by doctors and very low by nurses. Doctors also found the services much more user friendly—likely due to their greater familiarity with PCs.

Both groups found information services very useful because patient information is centralized; quickly accessed; clearly structured; and accessible for all staff.

The general conclusion is that these services improve the quality of home-based assistance.

Patients and Caregivers

Patients and caregivers think that this system improves their care. There were some complaints about the multiplicity of equipment and difficulties in the installation. Videoconferencing obtained the highest marks, and the impression of users was very similar to the opinion of the medical staff.

Users liked the remote monitoring services. Patients considered the warning service to be very useful as a reminder (e.g. , for when they should take a pill).


Preliminary conclusions

Although the trial is still in a preliminary phase, we have reached some conclusions that can be useful for further experiences.

  • Management and provisioning systems: It is important to integrate the broadband provisioning within the OSGi services provisioning. This is vital in case of failure so the service can be restored faster.
  • Operational costs: At least two days are needed to complete the installation in every house.
  • Specific equipment is needed in order to offer these services. This equipment should be transparent to the user, operate continuously without failure and be managed remotely. OSGi compliant residential gateways fit all these needs.
  • Cameras are not always welcome at home. The patients, as well other users, would like to turn the cameras on and off whenever they want to. The existing cameras did not allow this.
  • User friendly systems: In the pilot we are using a videoconference service based on Netmeeting and web-cams. However, we observed this is not very friendly for our users. Thus we are testing other systems based on the use of the TV to show the images and the phone as dialer and as voice interface.

We are encouraged by the reactions of all the trial users and look forward to reaching decisions on further work in this important application of home broadband.

( www.telefonica.es ) ( www.tid.es ) ( www.msc.es/insalud/hospitales/hcsc/home.htm ) ( www.hogardigital.net )


Your Voice -- Readers' Comments

Access to Broadband

Charlie Sands wrote: "I am very impressed by what you are doing and the info you provide on your website. I hope that someday we will be able to meet as I am very interested in promoting broadband on a global basis. I am a co-founder of the Access to Broadband Campaigns in the UK and Thailand. Our UK website is at www.abcampaign.org.uk and we launched our campaign with The Rural and Regional Broadband Conference held in London on July 9th."

He added that they now have "base level funding for our campaign and we are now getting formally organized in terms of establishing a professional campaign".

Changes for Selling Voice In France

Fabien Maisl of Cirpack, who set up our introduction to Michael Boukobza of Free Telecom (see above) wrote: "I thought you would be interested to see that LDCOM is reacting at Free Telecom's success with their VoIP/DSL service. Note LDCOM is the largest alternative operator in France (second largest telco after the incumbent) and Free Telecom is the largest alternative ISP (second after the incumbent).

They are both launching VoIP over DSL services for the residential market with very aggressive pricing schemes. This is completely changing the way voice is sold (pay for DSL, get voice for free whereas we have been used to pay for your phone line and get free internet access).

I expect a lively fourth quarter in the French voice market as other operators figure out how to compete."

Here's Fabian's summary of the details on LDCOM's offering, as excerpted and translated from ZDNet France:

  • VoIP service will be available on their unbundled DSL lines as of October 1st.
  • calls will be free between 9Telecom subscribers and 1euro cent per minute for PSTN calls, either local or national.
  • this service is packaged with a 1024kbps ADSL line at 27 euros per month (Free is 30 euros)
  • Voice enabled modems will be sold at 30 euros (Free lends it for free).
  • TV over DSL service should be available "early 2004". Experimentations are already in progress with TF1, the largest French TV channel.

Fabian also mentions that the voice services from both LDCOM and Free Telecom are managed by Cirpack switches.


Website Changes

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