Some of the transitional technologies will rely on telephone networks. By 1997, most fast modems will support the simultaneous transmission of voice and data across existing phone lines. When you’re making travel plans, if you and your travel agent both have PCs, she might show you photos of each of the different hotels you’re considering, or display a little grid comparing prices. When you call a friend to ask how he layered his pastry to get it to rise so high, if you both have PCs connected to your phone lines, during the conversation, while your dough is resting, he will be able to transmit a diagram to you.
The technology that will make this possible goes by the acronym DSVD, which stands for digital simultaneous voice data. It will demonstrate, more clearly than anything has so far, the possibilities of sharing information across a network. I believe it will be adopted widely over the next three years. It is inexpensive because it requires no change to the existing telephone system. The phone companies won’t have to modify their switches or increase your phone bill. DSVD works as long as the instruments at both ends of a conversation are equipped with appropriate modems and PC software.
Another interim step for using the phone companies’ network does require special telephone lines and switches. The technology is called ISDN (for integrated services digital network). It transfers voice and data starting at 64,000 or 128,000 bits per second, which means it can do everything DSVD does, only five to ten times faster. It’s fine for midband applications. You get rapid transmission of text and still pictures. Motion video can be transmitted, but the quality is mediocre—not good enough to watch a movie, but reasonable for routine videoconferencing. The full highway requires high-quality video.
Hundreds of Microsoft employees use ISDN every day to connect their home computers to our corporate network. ISDN was invented more than a decade ago, but without PC-application demand almost no one needed it. It’s amazing that phone companies invested enormous sums in switches to handle ISDN with very little idea of how it would be used. The good news is that the PC will drive explosive demand. An add-in card for a PC to support ISDN costs $500 in 1995, but the price should drop to less than $200 over the next few years. The line costs vary by location but are generally about $50 per month in the United States. I expect this will drop to less than $20, not much more than a regular phone connection. We are among companies working to convince phone companies all over the world to lower these charges in order to encourage PC owners to connect, using ISDN.
Cable companies have interim technologies and strategies of their own. They want to use their existing coaxial cable networks to compete with the phone companies to provide local telephone service. They have also already demonstrated that special cable modems can connect personal computers to cable networks. This allows cable companies to offer bandwidth somewhat greater than ISDN’s.
For cable companies another interim step will be to increase the number of broadcast channels they carry five- to tenfold. They’ll do it by using digital-compression technology to squeeze more channels onto existing cables.
This so-called 500-channel approach—which often will really only have 150 channels—makes possible near-video-on-demand, although only for a limited number of television shows and movies. You would choose from a list on-screen rather than selecting a numbered channel. A popular movie might run on twenty of the channels, with the starting time staggered at five-minute intervals so that you could begin watching it within five minutes of whenever you wanted. You would choose from among the available starting times for movies and television programs, and the set-top box would switch to the appropriate channel. The half-hour-long CNN Headline News might be offered on six channels instead of one, with the 6:00 P.M. broadcast shown again at 6:05, 6:10, 6:15, 6:20, and 6:25. There would be a new, live broadcast every half hour, just as there is now. Five hundred channels will get used up pretty fast this way.
The cable companies are under pressure to add channels partly as a reaction to competition. Direct-broadcast satellites such as Hughes Electronics’ DIRECTV are already beaming hundreds of channels directly into homes. Cable companies want to increase their channel lineup rapidly to avoid losing customers. If the only reason for the information highway were to deliver a limited number of movies, then a 500-channel system would be adequate.
A 500-channel system will still be mostly synchronous, will limit your choices, and will provide only a low-bandwidth back channel, at best. A “back channel” is an information path dedicated to carrying instructions and other information from a consumer’s information appliance back up the cable to the network. A back channel on a 500-channel system might let you use your television set-top box to order products or programs, respond to polls or game-show questions, and participate in certain kinds of multiplayer games. But a low-bandwidth back channel can’t offer the full flexibility and interactivity the most interesting applications will require. It won’t let you send a video of your children to their grandparents, or play truly interactive games.
Cable and phone companies around the world will progress along four parallel paths. First, each will be going after the others’ business. Cable companies will offer telephone service, and phone companies will offer video services, including television. Second, both systems will be providing better ways to connect PCs with either ISDN or cable modems. Third, both will be converting to digital technology in order to provide more television channels and higher-quality signals. Fourth, both will be conducting trials of broadband systems connected to television sets and PCs. Each of the four strategies will motivate investment in digital network capacity. There will be intense competition between the telephone companies and cable television networks to be the first network provider in a neighborhood.
Eventually, the Internet and the other transitional technologies will be subsumed within the real information highway. The highway will combine the best qualities of both the telephone and the cable network systems: Like the telephone network, it will offer private connections so that everyone using the network can pursue his or her own interests, on his or her own schedule. It will also be fully two-way like the telephone network, so that rich forms of interaction are possible. Like the cable television network, it will be high capacity, so there will be sufficient bandwidth to allow multiple televisions or personal computers in a single household to connect simultaneously to different video programs or sources of information.
Most of the wires connecting servers with one another, and with the neighborhoods of the world, will be made of incredibly clear fiber-optic cable, the “asphalt” of the information highway. All of the major long-distance trunk lines that carry telephone calls within the United States today use fiber, but the lines that connect our homes to these data thoroughfares are still copper wire. Telephone companies will replace the copper-wire, microwave, and satellite links in their networks with fiber-optic cable so they will have the bandwidth to carry enough bits to deliver high-quality video. Cable television companies will increase the amount of fiber they use. At the same time fiber is being deployed, telephone and cable companies will be incorporating new switches into their networks so that digital video signals and other information can be routed from any point to any other point. The costs of upgrading the existing networks to prepare for the highway will be less than a quarter of what they would be to run new wires into every home.
You can think of a fiber trunk as being like the foot-wide water main that carries water up your street. It doesn’t come directly to your house; instead, a smaller pipe at the curb connects the main to your home. At first, the fiber will probably run only to neighborhood distribution points and the signals will be carried from the neighborhood fiber on either the coaxial cable that brings you cable television or on the “twisted-pair” copper-wire connections that provide telephone service. Eventually, though, fiber connections may run directly into your home if you use lots of data.