DSL

DSL Prime: International News

Reports on DSL competition in Germany and Canada show that some nations are doing everything right while others are handing the keys to the future to the local monopoly.

by Dave Burstein DSL Prime [March 29, 2002]

4.7 EUR linesharing price is tough for German competition
DT is doing great, but is monopoly the right policy?
DT charges EUR 8.61 retail for the most common local DSL connection, so a price of 4.77 just for the higher frequencies makes it hard for competitors to amortize their DSLAM investment. The price differential is only EUR 3.84, putting an extreme squeeze on QSC and other competitors.

The details of startup and other fees still to come will be crucial. There's more potential margin in the metro loop, the connection from the local exchange to the central ISP point of presence. Previous DSL Primes have missed the significance of the metro loop costs in Germany.

"The charges give enough room for offering attractive and competitive services for high-speed Internet access," claims RegTP president Matthias Kurth, putting a spin on his decision that may be unwarranted. DT still has 98 percent of the market or so, and Kurth is making the mistake of confusing dreams with serious competition. Until competitors have enough market share to be profitable, Kurth will have to make sure every item in his power (colo pricing, backhaul rates, interconnection regulations, billing rules, etc.) is dramatically modified to encourage alternatives to monopoly. Germany has a long way to go.

Bell Canada remote DSLAMs follow the BellSouth model
Cheap field DSLAMs rather than Pronto-style new remotes
Bell Canada's results put the U.S. telcos to shame, with twice the take rate, 757K subs yearend (soon to pass 1M), 70 percent plus availability, and a better service record. They plan to cover 90 percent of the population shortly, ordering $400M from Alcatel.

To serve customers behind remotes, they faced a choice of emulating SBC's Project Pronto (installing new, advanced DLCs for improved telephony and high capacity) or BellSouth (just adding a small DSLAM unit for DSL, either in or alongside existing cabinets). Unless they have other reasons to install a new DLC, they will simply add a small Alcatel DSLAMs, a variety of models, including some hardened for the Canadian winters. New DLCs reduce maintenance costs by reducing the time a technician requires to install each customer, as well as providing faster, more reliable backhaul to provide more robust service. Jim Sackman of AFC believes they more than pay for themselves over time.

Bell Canada has chosen to match the cable pricing, currently at $45 Canadian/$30 U.S, with aggressive promotions. They plan to introduce a higher speed/higher priced service, with extra features that may include a firewall and virus protection.

Video to combobox via satellite
Bell Canada believes, as I do, that cable competition can't be ignored, and video needs to be part of the bundle. They will deploy later this year an Echostar "combobox"—satellite settop box, ethernet and USB ports, modem, wireless option, dual tuners and PVR. The first wave will be primarily served video via satellite, rather than over the DSL line. This will allow Web browsing, picture in picture instant messaging on the TV, and TV e-mail. The second tuner can download encoded movies to the hard drive, for high-quality video on demand. Bell Canada already has over a million satellite customers. They've been among the most advanced in trials of VoDSL and VDSL. The tech trials on Next Level VDSL ran fine, Clayton Mangione tells us, and now is moving building by building to market. They're offering the full video package of Bell ExpressVU.

"Broadband to the TV allows much faster responses to the web and e-mail, and changes the user experience dramatically. Means you can check your e-mail during two minutes of commercials. The combobox has storage and processing power— we're already working on some extraordinary future services."

Copyright 2002 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

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1. DSL Prime News: The Inside Source

2. DSL Prime: International News

>3. DSL Prime: Voice and Video Over DSL

4. DSL Prime News Briefs