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January 24, 1997updated 04 Sep 2016 12:42am


By CBR Staff Writer

While the likes of @Home Corp’s Will Hearst are still enjoying a honeymoon from an industry that is still trying to work out how its cable modem-based service works, whether it is wanted, or indeed at all viable in a business sense, Fortune magazine’s Stewart Alsop wasted no time recently in going for the jugular and dismissing cable modems and all they represent as a waste of time and those that think they might succeed as mere fantasists. The cable industry, and companies like @Home and its cable partners, reckon that users are willing to pay $35 per month on top of their current cable bill for rental of the modem and high- speed access. That doesn’t seem unreasonable at first glance. After all, there about 36 million US homes with personal computers, with a large proportion of them already having cable as well. And these home users have proved that they are willing to spend quite a lot on equipment and services in the past, so about a doubling of their monthly service charge for a vastly improved access speed, with the inherent telephone bill savings, would seem to be a reasonable business model. But Alsop pointed to the logistical nightmare that could ensue should anybody want to have a modem installed. Sending computer data both ways down a cable is quite a different matter from sending television one way.

Up and running

To get the service up and running, the cable operator must despatch separate engineers to set up both the cable and the computer. One adds a branch to your television connection with a wire that leads to your cable modem, while the other has to network your computer to the cable modem. But unless the local cable system had been upgraded so users could connect via coaxial cable to send data back over the net, they have to plug a phone line into their cable modem. This means a dedicated line for the computer would be very useful, but perhaps not what they expected they’d need in the world of cable modems. This would also rule out the realistic possibility of video conferencing at the moment, because even if the other person had a cable modem, you’d still be going through a phone line. The cable modem has to connect to an Ethernet port in the back of your machine, so a small local area network must be created between the computer and cable modem. No easy task, even for the hardware-literate. If the cable modem is to be shared by other computers in the house, they too would have to be networked. The main advantage cable has over rival systems is speed, running at up to 10Mbps; that’s ten times faster than ISDN. A T1 line – not feasible for all but a few households – runs at up to 1.5Mbps and DirecPC from Hughes Network Systems downloads via satellite at up to 400kbps, but uploads at whatever speed you access your service provider. DirecPC’s geo-stationary satellite, hovering somewhere roughly over Texas, works by constantly scanning for your IP address and plucking whatever is attached to that out of the broadcast stream and firing it down to your dish. Alsop believes satellite is the answer as far as television is concerned. It can provide more services for roughly the same cost, and would mean users turning off parts of their cable service, which would make the price of cable modems seem all the more expensive. It’s something to bear in mind while the volume of the hype around cable modems is cranked up still further.

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