Charter sails into home nets

Apr 9, 2001  •  Post A Comment

Hoping to fend off an aggressive competitive challenge from the direct broadcast satellite industry, Charter Communications is planning to offer home networking, digital video recording, video on demand and high-speed Internet access as a single package on digital cable subscribers’ television set-top boxes.
The home networking initiative would enable its subscribers to transmit photos, files and images between their personal computers or television set-tops and wireless devices such as Web pads and digital home security cameras, said Steve Silva, senior vice president of corporate development and technology at Charter Communications
“We really do think the paradigm shift for us is to become a broadband provider that delivers multiple services that appeal to individuals in a home rather than the whole home,” Mr. Silva said.
Last August, the Federal Communications Commission gave its nod to the digital home networking industry when it issued a rule allowing a consortium of companies, including Charter, Compaq and Motorola, to increase the bandwidth at which the companies’ devices can operate. The FCC decision established a specification known as Home RF for communication between electronic consoles in the home.
The Charter networking project is expected to be unveiled within the next couple of years. However, the industry must still be convinced that Charter’s dream of electronic media convergence will become a reality.
“The MSOs don’t want to have those high-end set-top boxes [that are necessary for home networking] on their books,” said Yankee Group Senior Analyst Michael Goodman. “They’ve talked a lot about networking, but they’ve definitely put it further down the list.”
To be sure, Charter’s digital-video-recording undertaking, in which it is teaming with ReplayTV parent Sonicblue, isn’t expected to be fully deployed until late 2002, and the home networking services won’t materialize until after the digital video recording project is completed.
Although Charter’s promised platter of services would be revolutionary in their coalescence of the hottest media technologies-VOD, DVR, broadband and home networking-onto a single set-top platform, Paul Allen’s multiple system operator was upstaged recently by Mr. Allen’s company of origin, Microsoft. Last month, the software giant unveiled its Windows XP beta 2 personal computer operating system, which includes several of the features that Charter is planning to offer through its home networking service.
For instance, XP beta 2 users can send files, images and photos from their computers to wireless appliances. In addition, the digital-video-recording service on Charter’s horizon is mirrored by similar features on Microsoft’s new UltimateTV satellite television offering.
Even before Charter introduces its digital video recording and home networking concoctions, the MSO must complete its ongoing discussions with the major entertainment studios. Some of the majors may worry that MSOs’ rapid appropriation of their film libraries for digital video-on-demand ventures may erode studios’ home video or DVD rental revenues.
“We are in negotiations with all the studios right now,” Mr. Silva said.
Although Mr. Silva said the conversations are progressing nicely, he added, “They [the studios] are just not sure what the right relationship is with the MSO.”