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SBC to test high-speed plans in Houston

The company says that in its effort to deliver lightning-fast fiber-optic connections to the masses, small businesses in Houston will serve as its first guinea pigs.

SBC Communications unveiled the latest details of its experiment to deliver lightning-fast fiber-optic connections to small businesses and residents Thursday, revealing that small businesses in Houston will serve as its first guinea pigs.

SBC, one of the nation's largest local telephone companies, said at the Networld+Interop networking industry convention in Las Vegas that about 1,000 companies in the Houston area will race along the information superhighway on a souped-up T1 fiber-optic connection by year's end with another 8,000 users in 2002.

Similarly, people moving into the 6,000-unit Mission Bay development in San Francisco next year will be the first residential customers to test-drive a direct-fiber connection that delivers data at rates far higher than the speed of a dial-up modem.

As previously reported by CNET News.com, these projects represent the latest phase of SBC's $6 billion Project Pronto plan to deliver a single connection for customers to carry telephone service as well as high-speed Internet and cable TV signals.

SBC will use the projects to determine not only the efficiency of the service but how it can be delivered to consumers at an affordable price.

SBC said the technology it is using, called passive optical networking (PON), is cheaper to install and operate than earlier copper wire-based networks because it doesn't require a power source outside the central office, the phone company's switching facilities. SBC said this optical technology also allows for the shared use of fiber between the office and the customer.

"Our goal is to provide our customers with broadband access that enables them to get the content and applications that are important to them," Ross Ireland, senior executive vice president of services for SBC, said in a statement.

Still looking to boost demand for digital subscriber line (DSL) service in the past year, SBC executives said both projects will be launched concurrently and will not require new investment beyond the current budget because the technology complements the company's existing DSL service.

SBC is the nation's largest supplier of DSL connections for consumers. The company finished 2000 with more than 750,000 customers. But SBC also took some heat recently for raising its standard DSL price to nearly $50 per month, up from about $40.

Jeff Kagan, an independent telecommunications industry analyst, said Wednesday's announcements are consistent with the company's long-standing strategy to provide more bandwidth to customers without having to start from scratch.

"From day one they expected to expand beyond basic DSL-over-copper lines," he said. "This announcement is the beginning of that new phase of Pronto. Customers are screaming for high-speed connectivity for homes and offices."

News.com's Corey Grice contributed to this report.