Fueling the race to bundle telephone service, high-speed Net access, and cable TV programming, US West Communications said today that its estimated 25 million consumers will be able to get all three services via copper phone lines by 2000.
Dubbed TeleChoice, the service will integrate digital TV and Net access using "variable digital subscriber lines," or VDSL. The technology essentially splits existing analog lines into two pipes to transmit voice down one channel and data traffic down the other. TeleChoice Net access will ship data at 1 to 4 megabits per second, according to US West, which is up to 70 times faster than a 56-kpbs modem.
After US West completes a trial in Phoenix this summer, the service will be rolled out to 14 Midwest and western states.
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"At last, people will be able to marry the convenience of television and telephones with the power of the Internet," Solomon Trujillo, chief executive of US West, said in a statement. "They'll even be able to see who's calling on the phone [through Caller ID] and scan the Internet, all as they're watching their favorite shows on TV."
Although US West is in the process of spinning off its cable division, MediaOne Group, into a separate company, the huge telco's move today is an effort to stave off its cable rivals' aggressive plunge into the high-bandwidth Net access market.
The convergence of Net access and TV programming has spawned a new battle field for telcos. Now they have to compete with the likes of America Online, as well as the growing number of partnerships between companies such as Cox Communications and @Home, which are offering speedy Net service and an array of online content sites via cable.
In addition, Microsoft's WebTV is expected to work with DSL in the coming year. The software giant is part of a high-tech consortium along with Intel and Compaq to push faster deployment of DSL technology.
But US West's venture into digital TV could help it stay ahead of the curve. Digital TV is expected to be available to some consumers by May of next year. The Federal Communications Commission is pushing the technology, which offers TV viewers a clearer picture and crisper sound.
"I think we're going to see a lot more players offer these integrated services," said Jill Frankle, a senior analyst for International Data Corporation.
"Both the cable companies are expanding their offerings and the telcos are expanding their offerings, so they're converging to the same space," she added. "The telephone companies need to come up with these offerings quickly to see if they can get people to migrate to their services or they will get hurt by the cable companies luring their customer base."