TCI told CNET today that it is bullish about the idea, a detour from @Home's original plan to use only cable systems for Internet service. As previously reported, TCI is seeking to scale back its investment in cyberspace and focus on its core cable TV business to bolster profits. The cable TV giant, along with Cox Communications and Comcast, is an investor in @Home.
TCI chief executive John Malone "is bullish on investigating it," a company spokeswoman said. "It's one opportunity to solve the expense to market issue" of delivering high-speed Net access, she added.
Trials could begin this spring, allowing @Home to keep pace with a schedule of new services that it has had difficulty meeting. Seen as an industry leader in the nascent market for Net access over cable, @Home has been criticized for repeated delays in the rollouts of its service--casting doubt over the viability of the technology in general.
The move to use phone lines is apparently aimed at relieving some of that pressure, giving @Home some breathing room to complete the network infrastructure needed to build the two-way cable system it has planned. From the cable industry's perspective, the new system could preserve most of the benefits of @Home's network while reducing operational costs until the final system can be constructed.
In the current system, consumers send and receive data from the Internet through a cable that plugs into their home PCs. The two-way system is faster than either conventional modems or ISDN lines, but it requires the cable companies to make costly upgrades to their networks. TCI has yet to complete that effort nationally, though it has made inroads in cities such as San Jose, California, and Hartford, Connecticut.
Under the newly proposed network, consumers would continue to receive data by cable, but information that they send out over the system, such as email, will travel over conventional phone lines. For the cable companies, the so-called "telephone-return path" lowers their upgrading costs.
Consumers will still be able to receive data at the higher speed, preserving their ability to get sound and pictures far more quickly than today's standard analog phone modems allow. They send information, such as email, at the slower analog speeds.
The new system also could be more costly for consumers than the two-way cable network, because it means that they have to use a phone line as well as a cable line to use the service. But @Home contends that it still is cheaper and faster than ISDN, a competing high-speed Net access service that uses analog lines.
"It's a little bit slower and a little bit pricier, but at least you get into the market," said Mike St. John, manager of network security for @Home. The service currently is priced at about $30 to $40 per month, excluding installation. Eventually, it could also be used to bring cable Internet access to television sets.
Although trials using the new system could begin this spring, @Home executives cautioned that no deal has yet been signed with a cable company. In addition, modem manufacturers are still working on a product that could be used in such testing. Sources cited Motorola and Hewlett-Packard as possible modem makers.