TMCnet News
Whither Project Lightspeed?By David Sims [email protected] The news as of the first coffee this morning, and the music is Bruce Springsteen’s blistering gospel-rocker “Just Around The Corner From The Light Of Day,” from his MTV: Plugged In And Turned Up To Eleven, Dammit: So, whither SBC’s Project Lightspeed? An on-schedule, successful project or Project Pronto redux? SBC’s bold entry into useful consumer innovation or a monumental sinkhole costing 10,000 jobs and counting? A couple weeks ago Broadband Reports had a post saying “Responding in part to investor concerns about the company’s TV plans, SBC today indicated the company would be able to generate enough free cash flow to cover the additional capital expenses necessary next year for deployment of its next-gen DSL network (e.g. Project Lightspeed) – which SBC insists is on schedule. The company says they will have reduced their workforce by 10,000 positions for the year to help cut costs.” Posted reader comments ranged from “And how many jobs is SBC going to lay off to cover the costs of realizing that implementing hybrid fiber adsl2/vdsl(2?) is a waste of money and has to redo their system to all fiber?” to snide comments about SBC’s late, unlamented Project Pronto and such jabs as “REMEMBER SBC said this same thing in 2004 when it said it was going to have ‘lightspeed up & running by 2005,’ it was ‘in the testing stages,’ maybe those 10,000 people are the employees that tested lightspeed & said they didn’t like it,” before the thread dribbled off into anti-Wal-Mart ramblings. Frankly First CoffeeSM wonders how SBC will be able to absorb AT&T and get Lightspeed up and running all at the same time, but of course the minds that grapple with such issues are far above those of mere mortals who simply write about them. Lightspeed: A Primer Project Lightspeed is SBC’s project to expand its fiber-optics network deeper into neighborhoods to deliver SBC U-verse TV, voice and high-speed Internet access services, using fiber-to-the-node and fiber-to-the-premises technologies. It’s intended to compete with broadband access from cable companies, “wireless broadband from companies like Nextel and other fiber rollouts from firms such as Verizon.” Using FTTN, the companies plan to bring fiber to within 3,000 feet on average of customers’ homes. It doesn’t guarantee fiber connections to users’ homes, just backbone with fiber speed. Ah, that pesky last mile. Instead of using a traditional broadcast video system, in which all content is continuously sent to every customer’s home, SBC companies say they’ll use a switched IP-video distribution system, where only the content the customer requests is provided to the customer, freeing up bandwidth to be used for other applications and more content. They’ll use Microsoft TV Internet Protocol Television Edition software platform and work with Alcatel to provide access, routing, and aggregation infrastructure equipment and video system integration services. “We’re On Track.” A few days after the Broadband Reports post, Jeremy Reimer wrote that SBC “reassured a group of telecommunications professionals yesterday that their Project Lightspeed, an effort to bring high speed fiber-optic networking to 18 million customers, was still on track despite moving the deadline for completion ahead by six months.” According to Reimer, Lea Anne Champion, the SBC executive in charge of Project Lightspeed, said hey, no problems, we’re on track with all the plans for IP video, voice, and data services reaching 18 million households by mid 2008, or half of all households SBC serves: “We have just completed a successful field trial of IPTV and data and we got the results we wanted. We are now moving on to the next phase, a controlled trial late this year or in early 2006.” Industry analysts “have long predicted that the slow-moving telcos would inevitably succumb to market pressure from cable and Internet companies, especially those providing services like Voice over IP that competed directly with their primary market,” Reimer writes. Project Lightspeed is SBC trying to make an obligation into a virtue. And then, being a techie, he throws in the obligatory Star Wars analogy: “Massive spending efforts like Project Lightspeed seem like an ‘Empire Strikes Back’ from the massive Baby Bells, but will the delays allow the smaller, nimbler firms to triumph?” Fill in your own answer to that rhetorical question. The Death Star Fires Back Yesterday the Death Star – sorry, SBC, but they do have the most Death Starry-logo, fired back in a press release updating Project Lightsaber – Lightspeed. Evidently, SBC companies have recently concluded a technical field trial of IP-based services, which they say “successfully demonstrated that the technology works in a real-world environment.” During the two-month trial ending in October, SBC companies delivered IP-based TV programming, video-on-demand, high-speed Internet access and other features to employee households in San Antonio in the second of two employee field trials. “The conclusion of our field trials and successful delivery of these new IP-based entertainment services was a significant program milestone,” said Andy Geisse, chief information officer, SBC Services, Inc. “IP is the next big thing. We’re going to change the face of television with an IP-based platform that enables integration, personalization and a high-quality entertainment experience.” Addressing a group of industry analysts hosted by IBM in New York, Geisse confirmed that the next phase of Project Lightspeed – a controlled market entry – is set to begin around the end of 2005/early 2006 in neighborhoods in San Antonio with a limited number of subscribers. SBC companies expect to scale the offerings beginning in mid-2006, adding features and functionality and entering more markets across the companies’ 13-state operating region. Empire I vs. Empire II. Back in November 2004 the promise from SBC was that it would begin constructing its fiber network in the first quarter of 2005 “with the hope of offering fiber-based services to 18 million households by the end of 2007,” and to “start selling video service over the Internet by the fourth quarter of 2005.” Of course one motivating factor for SBC is that Verizon’s in the game, too with FiOS, their fiber-to-the-premises broadband service. “Verizon noted that FTTP penetration reached 12.4% in the 35 regions where it has marketed the service,” writes Simon Leopold, a telecom analyst at Morgan Keegan & Company Inc. according to Unstrung. “Verizon disclosed total broadband (DSL plus FTTP) net additions of 389,000, and we estimate that Verizon has 136,000 – 149,000 FiOS subscribers and may target a surprising 300,000 by year-end.” SBC says Lightspeed will be ready to serve 2 million customers by the end of the year. Verizon says that FiOS deployment is on track to offer service to 3 million potential customers before year’s end. Light Reading quotes SBC’s CFO Richard G. Lindner as saying that SBC hopes to have fiber deployment “out and passed to facilitate 2 million homes on Lightspeed” before the end of this year. Of course “passing” a home doesn’t mean “getting money from subscribing, hooked-up customers in” a home. And SBC’s playing coy with reports back in June of delays to Microsoft’s TV component of the service over scalability problems, and that like SBC and Lightspeed itself, has overpromised on how quickly they can turn a good idea into a commercially viable and profitable reality. (“Scalability in beta versions is not what it will be in the released version,” notes Ed Graczyk, director of marketing for Microsoft TV.) Stay tuned. If read off-site hit http://blog.tmcnet.com/telecom-crm/ for the fully-linked version. First CoffeeSM accepts no sponsored content. |