Weekly Wire
Gambit Weekly The WIRED LIVING ROOM

By Frank Beacham

SEPTEMBER 15, 1997:  It is the 1997 version of a gold rush. A seemingly endless number of high-tech companies are locked in intense competition for what they hope is the mother lode of the information age: the "wired" living room.

Though the basic product is an affordable, big-bandwidth pipeline universally available to American homes, the implications of such technology go well beyond the delivery system. Many investors expect the home bandwidth breakthrough to spawn an entirely new sector of the entertainment industry -- one that for the first time combines traditional broadcast television programming with the interactive information resources now available on the Internet.

Greater bandwidth (meaning the capacity to carry huge amounts of data at very high speeds) not only means faster access to web pages, sound and graphics, it also means that substantial nuggets of 30-frame-per-second video -- the mainstay of modern broadcast television -- can finally be delivered efficiently over the Internet. It also means that traditional longform broadcast television programming will be increasingly linked to web pages and other Internet information now accessible only by personal computer.

But there are still kinks to be worked out.

"The first thing is that access to the Internet needs to be simpler," said Darryl d'Aquin, owner of Commnet Data Systems in New Orleans. "Doing dial-ups (the traditional connection for Internet users) is not very practical when you have more digital services going into the home. Access may be part of your day-to-day routine at work, but you usually have to do something extra at home. It's not a simple move."

The impact of the big bandwidth stampede is cascading into every nook and cranny of the television industry. Recently, television manufacturers such as Thomson Consumer Electronics (RCA, Proscan and GE brands), Zenith (with its new Inteq brand), Sony and others have announced plans for new home television products that include Internet access. At the same time, computer giants like Microsoft, Intel and Compaq are introducing new broadcast-friendly personal computers.

Wired and wireless-cable operators, direct-to-home satellite services and broadcasters of all sorts are furiously working to challenge the phone company lock on Internet services to the home and office. Program producers and new media companies, sensing the looming breakthrough, are preparing a new category of entertainment television programs that combine data services with traditional video.

"I think the bandwidth break will come sometime next year," said John Warnock, CEO of Adobe Systems, a leading manufacturer of design software for the creation of web sites. Adobe, he said, is already hard at work planning for a new generation of authoring tools that incorporate video content within web pages.

Bandwidth, or the amount of information that can be carried over lines -- whether fiber optic, coaxial or other -- is the key. And d'Aquin said there's enough available right now to satisfy most home needs.

"Bandwith is more prevalent, and there are more providers of data services than ever," he said. "As for the hardware costs, that is an issue. Everyone expects to get all those features for $19.95 a month, but that won't happen. But as long as costs are realistic with respect to the perceived value of the service, people will pay for it. They will spend a little money in order to get home, do work at home and minimize the impact on the family."

The recent announcement that Thomson Consumer Electronics would team with Compaq to develop a new generation of home entertainment products recognized the fast approaching new era of data-enhanced broadcasting.

"We envision an initial direction of highly featured products that will particularly appeal to video enthusiasts and computer-experienced consumers who enjoy the home theater experience," said Joseph P. Clayton, Thomson's executive vice president of sales and marketing. "Internet capability will be just one application that will transform the private experience of the PC to an entertainment and information experience that can be shared by the entire family."

And there are two different ways to get that experience.

"There's a TV-centric platform and a PC-centric platform developing for the Internet," said Hal Krisbergh, a veteran cable industry executive. That means that certain types of Internet content will be created for big-screen entertainment viewing in the living room, while other content is designed for access by a personal computer on a desktop.

"TV viewers are going to be able to access web pages, advertisers and information on sporting events that they are watching," said Krisbergh, whose startup Worldgate Communications soon will offer Internet services. "All sorts of very interesting things will happen on the TV-centric entertainment platform."

Steve Sawyer, director of public and governmental relations for Cox Communications of New Orleans, said that the decision between PC-centric and TV-centric will be up to the consumer.

"It will be a matter of customer choice," he said. "Computer-friendly people like myself would utilize a computer more than a TV because you're able to save information, and there are more programs to use on the computer. That's not to discount the use of the television set for those people who are not into computers.

"Things are so scary for a lot of people, but the future is right now. [Cox] is making plans, and we want to be able to offer this stuff. It's going to happen."

Though paths of varying bandwidths may soon be open to the home, other bottlenecks remain in the vast global network of networks known collectively as the Internet. In fact, many experts think that increased numbers of high-bandwidth sound and video connections to the home will increase crowding on the Internet's backbone and circuits and actually slow down the Net as a whole.

One source of bottlenecks is the regional Internet hubs where computer systems interconnect.

"All the little Internet service providers connect ultimately through the big Internet service providers. There are often bottlenecks at the points where these services connect," said Felix Kramer, a New York City-based Internet consultant for businesses and organizations that engage in electronic publishing. "Some ISPs (Internet service providers) upgrade their systems, and some don't," he said.

"And there are still server problems," said Adobe's Warnock, recalling the not-so-distant days when interactive television tests challenged server technology. "Serving that amount of information over the Internet is going to be a tremendous challenge. Even with today's Internet, we have to use really, really, really fast servers. I think at first you'll see more of a hybrid broadcast style, and then it will become more on-demand as the performance gets up there on the servers."

Often forgotten in the bandwidth race is the reality that these technical changes will bring significant social changes to the Internet. Just as the interstate highway system permanently changed the American landscape, big bandwidth highways to American homes will forever change the stubborn, finicky, anarchic Internet that we know today. The sluggish telephone connections that have shielded Internet users from a hurricane of advertising and propaganda are about to disappear.

Moreover, d'Aquin said, "the lines between what's considered TV and what's considered computing are fuzzy."

"TV resolution isn't as good as a computer -- you could never do graphics development on a TV," he said. "But surfing the web may be easier [to see] on the TV than a word processing document. [But] as TVs go digital, the tendency is for it to migrate toward integrating it into computer systems."

Not so long ago, the grand promise of the Internet was of a participatory and democratic medium that would serve the interests of the public. Now the Net is rapidly transforming into an interactive broadcast medium through which corporations will bombard users with endless multimedia sales pitches. For most Net users, interactivity will be reduced to little more than consumer transactions, email and chat groups.

Big bandwidth may also signal the end of cheap Internet hook-ups. Felix Kramer predicts that ultimately the major telecommunications companies will charge for bandwidth in order to keep up with the dramatic technology demands of applications like video and audio.

Nevertheless, most in the industry believe the "wired living room" to be an integral part of the future.

"It's all information," d'Aquin said. "Whether TV or web site or email or online directories, it's all about information. The merging of how it's delivered is natural, and it makes your life easier."


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