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Published: Dec. 22, 2007, 3:22 p.m.

Mike Intro: December 19. 2007: Broadband the AT&T and Qwest Way
In this podcast we discuss AT&T and Qwests Fiber to the Node projects.

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Mike: Gordon, can you give us a little background on what AT&T is doing?

Project\nLightspeed was announced as a 6 billion dollar project by AT&T in\nJune 2004 and involves running optical fiber out to a remote terminal,\nor node and providing the last portion of the connection over copper\nwire. The project was ambitious from the start with initial plans to\nreach close to 19 million homes by the end of 2008. AT&T has given\nthe product the name U-verse\nand at the TelcoTV conference last October, VP of converged services\nat AT&T Labs Research Peter Hill gave the keynote address featuring\nthe product. Here's a few quotes from an October 26 CED Magazine post:

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AT&T\u2019s\nroll out of its IPTV video services has been slower than it originally\nanticipated, but with more than 126,000 current subscribers, the\ncompany feels as though it\u2019s on the right track. AT&T started the\nyear with 3,000 video subscribers, then grew that base to 16,000 and\n60,000, respectively, in the first and second quarters.

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\u201cWe\u2019re\npast the point of last year where the question was, \u2018Will IPTV\nscale?\u2019,? said Peter Hill, VP of converged services at AT&T Labs\nResearch, during the first keynote address Wednesday morning at\nTelcoTV. \u201cYou can\u2019t get to that number (126,000 subscribers) without\nsignificant flow through and automation. We do have a competitive\nservice and we can do it to scale.?

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Mike:\nThere's always been concerns about bandwidth, especially when compated\nto products like the Verizon Fiber to the Home, or FiOS project. How is\nAT&T doing with U-verse?

Bandwidth has been a major concern, with Hill commenting on the H.264 compression standard:

\u201cThe encoding rates for H.264 have come down faster than we projected,? Hill said. \u201cWe\u2019ll be able to do more channels in the same amount of bandwidth.?
Mike: What other services will be available?

Hill\nsays the company will be adding home DVRs that allow satellite set-top\nboxes to show video downloaded to the DVR box. Hill also said the\ncompany will be adding to the current 30 high-definition channels next\nyear along with photo-sharing and a Voice over IP (VoIP) service.\nHere's more interesting quotes from the CED Magazine piece:

While\ncable executives have said there is no compelling reason to move to an\nIP infrastructure to deliver video services, Hill contends that IPTV is\n\u201cvery different from cable and satellite? because the nature of IP\nallows for easier integration among services while also allowing it to\ntake advantage of Internet partners such as Amazon.......

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One\nof those features is \u201cCinema Center? that allows movies to be purchased\nfrom Amazon with one click. The movie portal content would be dynamic\nand would allow subscribers to view trailers prior to making their\npurchases.

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\u201cWe don\u2019t have to create this stuff in IP because it reaches out to Web devices and incorporates them into IPTV,? Hill said.

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Hill\ndemonstrated how an iPhone could be used to remotely program a home TV\nand how multiple cameras at live events could be selected by the\nviewer. He also demonstrated a feature that used an i-Phone to remotely\nconfigure channel favorites on a home TV. The application would give\nfour different i-Phone users the ability to program their favorite\nshows on their household TVs. Also discussed was a Web cam feature that\nwould let viewers in different locations view a live performance of a\nsporting event or dance concert based on IP technology that uses\nswitched digital video.

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Mike: I know they had problems with the original set top box - any updates?

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Also, according to CED Magazine:

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During the question-and-answer segment, Hill said AT&T would continue to rely on the Motorola set-top box with the Sigma Designs processor as its main workhorse, although it\u2019s also working with Scientific Atlanta on a box with the same signature.

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Hill expected new set-top boxes with second-generation chipsets from Sigma and Broadcom to be available in 2009.

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Mike: How is it selling?

The U-verse product website lists:

Subscribers: 126,000 U-verse TV and Internet subscribers in service (as of end of 3Q07)

Homes Passed: Approximately 5.5 million living units (as of end of 3Q07)

\n Deployment: Plans to pass approximately 8 million living units by the end of 2007Another interesting roll out to watch in 2008.
Schedule: AT&T expects to reach nearly 18 million households as part of its initial deployment by the end of 2008.

Mike: Speaking about FTTN - I know you recently blogged on Qwest and FTTN effort. Can you give us an update?

Qwest is based in Denver and provides services to 14 states in the western part of the U.S.

Earlier this week, Broadband Reports\nposted an interesting summary of a conference call with new (he started\nin August) Qwest CEO Ed Mueller. Here's a summary from the Broadband\nReports post:
Qwest will spend $300 million over the next two years to bring 20Mbps VDSL to around 1.5 million customers.
- $70-100 million will be spent on FTTN this year and another $200 million next year.
Qwest hopes to see a FTTN/VDSL penetration rate of 40% by 2010. Upgrades are going to cost the company around $175 per home. Qwest will focus on portions of around twenty un-mentioned markets.

The Denver Post also published an article yesterday outlining the call and indicated the company will not focus on IP video delivery, stating "the $300 million fiber-to-the-node project is not intended as a deployment of IPTV." Qwest currently has a video agreement with DirectTV and it looks like that agreement will stay in place.

The Post article gave a little more detail on deployment, stating the rollout "will focus on 20 markets with the project, 10 of its largest and 10 others." Also according to the article, Qwest has started to upgrade their network in Denver and Colorado Springs.

Second\ngeneration VDSL (Very High Speed Digital Subscriber Line), referred to\nas VDSL2, provides up to 100Mbps over standard copper telephone wires.

These will be\xa0 exciting products to watch in 2008.