The cable era begins
After much promise and many delays, the launch of @Home service marks the cable TV industry's foray into the Internet access market.
As reported by CNET yesterday, @Home and Tele-Communications Incorporated (TCOMA) launched their long-awaited high-speed Internet access service today in the San Francisco suburb of Fremont, California. Besides TCI, @Home partners Comcast and Cox Communications also are rolling out @Home service in several cities, such as Hartford, Connecticut, by year's end.
Already, however, the ventures face hot competition from Time Warner and Continental Cablevision, which are planning their own services to begin imminently in other parts of the country.
The prices of all these cable connections, typically in the monthly range of $30 to $40 excluding installation, may result in sticker shock for consumers who are used to dial-up Net access that generally costs about $20 a month for unlimited use. But the cable companies promise a faster, more comprehensive service than ISPs or telephone companies using regular analog lines.
Here's how it works: The same kind of cable used to receive TV reception hooks into a high-speed modem made by LANcity, Motorola, General Instrument, and others. The modem then plugs into a home PC.
To lure advertisers, the cable companies will offer targeted advertising with audio and video aimed at specific zip codes, for example.
It sounds simple, but making this possible required the cable companies to make substantial infrastructure developments and overcome regulatory challenges. Now, at least some of them are ready to go.
@Home actually launched Net access Tuesday to a small number of TCI subscribers in Fremont. The service costs $150 for installation plus $34.99 per month, excluding city franchise fees. Some cities, possibly including Fremont, also will get telephone service by the cable companies.
The Fremont rollout will be gradual and followed by launches elsewhere, such as Sunnyvale, California; Orange County, California; Arlington Heights, Illinois; Hartford, Connecticut; and Baltimore, Maryland.
"It comes through your cable TV line, so it's up to a hundred times faster than a typical phone modem," TCI and @Home say in a newly released brochure mailed to residents.
The service will include custom content from more than 60 companies, including the Wall Street Journal, New York Times, USA Today, ESPN, and CNET.
@Home is signing up customers and answering questions on its home page on the Net and a recently installed toll-free phone line.
In the Midwest, Time Warner's Internet access service, dubbed Road Runner, rolled out this week with an official launch set for next Tuesday. So far, 300 subscribers in the Akron and Canton, Ohio, areas have signed up for the service for $39.95 per month for unlimited access, Time Warner Cable spokesman Bill Jasso said.
Time Warner plans to eventually roll out Road Runner nationwide, but the timing depends on the success of the Ohio launch. Road Runner subscribers have access to 30 local sites designed exclusively for the service, including public libraries that allow users to browse and renew books, art museums, and children's hospitals.
On the East Coast, Continental Cablevision will roll out Net access via cable systems in Boston and Jacksonville, Florida, by the end of the month. That release initially was set for this week but has been postponed for "marketing reasons," according to Continental spokesman David Wood.
In Boston, subscribers will get to tap into proprietary content such as local news, weather and sports, and private videoconferences. The Jacksonville service initially will offer the content but not the videoconferencing.
The cable TV industry faces stiff competition, however. Phone companies are rushing into the market and at the same time invading the cable TV industry's turf with video services.
Pacific Bell launched cable TV service in San Jose this week, for example. PacBell, Bell Atlantic, and Cincinnati Bell will all also offer wireless TV programming this year.