April 1998

BY LAURA HOWARD

Market adoption of Digital Subscriber Line technology (xDSL) can be likened to Christopher Columbus’ famous voyage of 1492: it has taken longer, been harder, and is arriving at a different destination than ever expected. But, adoption of xDSL is just as inevitable as finding the New World. The new modem technology that transports data and multimedia over ordinary telephone wires is a new world of speed — and it suits the changing nature of how we work, communicate, and entertain ourselves. For telcos, xDSL provides a multibillion dollar opportunity to exploit the existing copper plant, a massive but underused asset.

A NEW CONQUEST FOR SERVICE PROVIDERS
The promise of xDSL is to provide high-speed Internet connectivity for consumers, and access to corporate networks for teleworkers and remote offices. Telco service providers also see opportunities to deliver new services like content distribution and data warehousing. Not only is ADSL (Asymmetric DSL) a platform for these services, it’s also a defense against competitive telephone companies and cable companies deploying cable modems.

Telcos also view DSL as a chance to unclog their voice switches. Much of today’s telephone line traffic is between consumers and their Internet Service Providers (ISPs). Since these online sessions often last an hour or more, they cause congestion in the Central Office switches. DSL bypasses the voice switch to access the core data networks, relieving data congestion through the switch.

UPDATING THE DSL VISION
DSL sprung to the fore when signal processing technology enabled ordinary telephone copper wire pairs to carry more than a single voice channel. Telephone wire pairs can handle much higher frequencies than the telephone equipment that they interconnect, and telephone companies recognized terrific potential for providing new services. Early DSL technology helped build markets for the PBX and "pair gain" systems, which put more traffic over fewer lines than previously possible. Since then, a bewildering array of different implementations emerged. We use the term "xDSL" to refer to all of the various "flavors" of the technology. Today, HDSL (High bitrate DSL) ships hundreds of thousands of units in voice and data systems. There is a substantial and growing DSL market now, with telco DSL lines serving small and large businesses around the world.

Telcos became interested in another implementation — ADSL — to develop a mass market for small offices and consumers. The original driving force behind ADSL was support for video-on demand for home entertainment. This application was appropriate for ADSL’s peak downstream data rate of about 8 Mbps. ADSL supports simultaneous voice and data traffic on the same line, critical for the consumer segment, by using frequency splitters on both sides of the lines.

At present, the business opportunity for video-on-demand has not materialized. In addition, telcos don’t yet have the core network bandwidth to support 8 Mbps for every customer. The vision for ADSL deployment has changed, and there is significant progress on multiple fronts to evolve the business model for ADSL. The industry is removing barriers in technology and standards; in business systems; and in provisioning the customer. Let’s examine these barriers, then take a look at the progress.

BARRIERS TO ADOPTION
Technology And Standards Barrier
Early ADSL equipment was expensive and required laborious installation by telco service people at the customer site. Equipment from different vendors was not based on international standards and was not interoperable. Line interference emerged as a problem.

Business Systems Barrier
ADSL, like many new technologies, requires many new systems for deployment and service. Telcos have to develop systems for marketing, selling, provisioning, and supporting the customer, as well as managing new traffic on their core networks. Billing, customer care, and network management systems have to be reengineered for ADSL services. ADSL trials have shown telcos that they can’t always predict the quality of particular telephone lines. Some lines have coils and taps that distort the ADSL signals, so telcos can’t promise customers how their DSL service will work. This calls for new line test procedures.

Customer Provisioning Barrier
The telcos have had a problem with customer provisioning. They’ve been cast uncomfortably into the business of providing end user modems because dif ferent vendors’ end user modems are incompatible with whatever Central Office ADSL equipment the telco has installed. Most telcos have no interest in entering the end user modem distribution business. They don’t want to roll trucks to a customer’s house or open a customer’s PC or answer a customer’s questions about modems. But until equipment can interoperate and standards can support a retail market, the telcos will be forced to continue to play this role.

1998: A TURNING POINT?
Much of this is about to change. Important forthcoming international standards, interoperability testing between vendors, and the experience of trial deployments are addressing these issues.

Standards And Interoperability
In 1998, two important line coding schemes will be standardized by the International Telecommunications Union (ITU). The ITU will complete the DMT standard from the American National Standards Institute (ANSI). DMT enables full-rate ADSL services at up to about 8 Mbps downstream. It will enable an interoperable, open-systems market. It has better interference performance than the previous CAP (Carrier-less Amplitude & Phase) standard, for which interference prevented widespread adoption. DMT chipsets became widely available late in 1997, and DMTbased systems will be widely available in the second half of 1998.

Also in 1998, service providers will be able to enter the DSL service business without having to supply modems to customers. Some vendors are working out interoperability agreements with other DSL vendors and beginning interoperability testing, so that their ADSL products will interoperate with the ADSL equipment of other vendors. The goal is to enable customers to buy ADSL end-user modems through the retail channels, rather than from telcos, and telephone companies can get out of the business of providing new end user equipment. According to industry analysts at IDC, "Telcos will see lower capital costs now that they will leave the purchase of CPE to the consumer."

Trials And Deployments
There have been many successful trials that demonstrated viability, requirements, and best practices for ADSL implementation. Paula Reinman, senior broadband analyst at TeleChoice, Inc., noted, "There is no doubt that the telco deployment of DSL to date has been under-whelming. The good news is that a number of them should emerge from trials into full service in 1998. For example, U.S. West has recently announced aggressive deployment throughout their service area. While earlier speculation was that the telcos were slow to deploy DSL services due to concerns about cross elasticity, the issues have moved more toward provisioning, operations, and service. These issues should get worked out in 1998."

New Applications In Enterprises
Enterprises also are looking to ADSL to extend their campus net — without laying fiber — to floors within a building, to other buildings, or to teleworkers at home over leased "dry" lines. This "private copper ADSL" is going into corporations, real estate developments, hotels, and government agencies through ISPs, VARs (value added resellers), and integrators. These applications will foster technology, new channels, and new expertise.

Companies can interconnect various buildings of a corporate campus with ADSL. Traditionally, this has been an application for HDSL, but ADSL’s single-pair service, voice/data capability, and relatively inexpensive equipment make it a good choice. To support telecommuters, companies lease dry lines — unserviced telephone lines that can carry ADSL signals — to employees’ homes, and concentrate these lines into their own networks. Princeton University’s Computer Science Department, for example, has installed a telecommuter program like this around Princeton, New Jersey.

Office space developers and building owners can offer shared data services to their tenants at a much lower cost than tenants could get otherwise. ADSL in an office complex lets tenants share a leased T1 line. We’re seeing specialized systems integrators and VARs beginning to enter this business to serve the real estate industry. Hotels also want to offer value-added services to customers and reduce costs. In 1998, we’ll see hotels offering guests in-room Internet access, and offering electronic commerce services such as travel reservations, conference services, and entertainment. For hotels without fiber or coax cable to rooms, ADSL provides these capabilities without having to rewire.

THE NEW WORLD
As much as we wish it were, this year will not be the year of mass deployment. But it will be a watershed year, setting the stage for mass deployment soon afterward. The Internet has forever changed how we live and work, and ADSL will ignite possibilities over the old telephone lines of the past that we never thought possible.

Laura Howard is vice president of marketing and business development for 3Com ADSL. Ms. Howard is active in such standards related activities surrounding xDSL as the ADSL Forum, ATM Forum, IETF, ITU, and other forums focused on enabling the market for rapid deployment of xDSL solutions. 3Com enables individuals and organizations worldwide to communicate and share information and resources at anytime from anywhere. With global reach and local touch, the company gives enterprises, network service providers, carriers, small businesses, and consumers comprehensive, innovative information access products and system solutions for building intelligent, reliable, and high-performance local and wide-area networks. For more information, contact the company at 1-800-NET-3COM, or visit their Web site at www.3com.com/xdsl.