1. Presentation to Sprint Research Symposium Lawrence, Kansas March 8-9, 2000 Dr. William Lehr Executive Director MIT Internet & Telecoms Convergence Consortium wlehr@rpcp.mit.edu http://itel.mit.edu Residential Broadband Internet Access in the United States: the Changing User Experience

2. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.2 Outline What is broadband? Cable vs. xDSL Cable availability Issues and Questions

3. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.3 What is broadband? “High speed” –greater than 200 Kbps (not 56K/ISDN) –both directions? (not DirectPC) –how measured? (CIR vs. burst) “Always on” Internet access –Access to standard Internet services: email, web browsing, telnet, and FTP

4. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.4 What technologies? Cable modems (since 1996) –pre- and DOCSIS modems xDSL (since 1999) –ADSL, SDSL, HDSL, G.Lite, etc. LMDS & other wireless (2000?) –Sprint’s MMDS plans

5. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.5 Cable vs. DSL Similar? –“High speed”, Always on, Internet access –Shared Internet access –Basic infrastructure ubiquitously available Different? –Cable more mature, more standardized –Cable Operators vs. Local Telephone companies? –Bandwidth limitations? Sharing? Location? –Residential vs. Business (initially) Cable early leader, DSL follows...

6. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.6 Cable vs. xDSL

7. Architecturally similar, but with different uncertainties Internet Cloud Server, Accounting, Cache, etc. Router Internet Cloud Server, Accounting, Cache, etc. Router DSLAM Cable DSL Central Office Headend Shared LAN: bandwidth and security issues Shared (muxed) bandwidth Varying distances from CO, wire groupings etc. Connections to Internet backbone and other ISPs

8. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.8 Pricing $40-$60/month for residential service –Compare vs. 2nd POTS line + dialup ISP account –Higher installation charges typical –Prices much higher for DSL commercial services Expect prices to fall….$40 or lower (?) Competition –Free ISPs

9. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.9 Availability

10. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.10 1996 1997 1998 Cable Deployment - 1998

11. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.11 Cable Modem Deployments Broadband far from universal –781 communities in US in 232 (3,133) counties through mid-1999 10% of counties, 43%* of population –Deployments progressing rapidly (65% cable systems 2-way) –Still early phase Deployment first to largest, affluent communities –Of largest 100 counties, 69 have modems –Where you would expect Strong MSO effect –MediaOne clear leader –Different strategies, different infrastructure

12. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.12 Demographics of cable modem deployments through June 1999

13. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.13 Broadband impacts Future of Internet is broadband access… Broadband users... –More experienced Internet users –Richer, better educated, etc. –Like early adopters of Internet More time on line… –Combine with telephone and other usage –Move PC to living space (??) –Wireless in-home networks (mobility, convenience) “Always on” critical –Save connection time –Enable push and other capabilities

14. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.14 Cable modem penetration: Prognosis Much higher than we have seen… –Mergers (AT&T/TCI/MediaOne, Time-Warner/AOL) –Little real marketing yet: supplier push weak Doubts about market acceptance Fears re customer service costs Little (if any) competitive pressure “Broadband content” in its infancy Internet not yet fully mainstream Standards, regulation

15. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.15 Issues and Challenges Traffic management –More bursty (self-similarity problem) Regulatory policy –Line sharing for DSL –Cable unbundling ??? New applications –Telephony over cable, over DSL –Streaming media –Napster, etc.

16. March 2000© Gillett & Lehr, Residential Broadband Internet Access in U.S.16 Issues and Challenges New networks: content delivery networks –Push and pull… Congestion –Managing consumer bandwidth expectations –Cable: upstream, DSL: cross-talk –Collocation space scarcity Always on, Security (Privacy)