I get it all the time: people call me a geek, and not just because I sign my articles with a geeky sobriquet. But I'm really as normal as the next guy – and like you, my eyes glaze over with all this talk of bits and bytes, upload and download speeds, coax and fiber.

 

Knowledge is power, as they say, and in this case, it's the power to avoid getting ripped off. Forget the tech: it's all about the bottom line. The decisions being made in a telco or cable company's boardroom are not just about what technology to implement or which proposals are compatible with what esoteric “standard.” Those decisions are going to determine which products and services your Internet Service Provider is going to offer you and at what price – and you are going to have to be able to figure out what's behind all the hype when you are asked to shell out money for a new, “upgraded” service or “advanced” piece of equipment by the cable or phone company in order to enter the wonderful world of the digital tomorrow.

 

The situation today – in which digital communications is set to take a great leap forward with the implementation of FTTH/C/N (Fiber to the Home/Curb/Neighborhood, as discussed last week) by telephone companies, or the next edition of DOCSIS by cable service providers, is akin to the introduction of cable modems and ADSL just a few years ago. ADSL users like myself who first signed up for the initial 256k/64k download/upload service offered by the phone company when it became available expected a super-fast online experience – after all, according to my calculator, 256K was four and a half times than the standard 56k modem we were all upgrading from. And you didn't have to dial into the network either – the ADSL connection was always on!

 

But as every ADSL user knows, the new connection was nowhere near four times faster than dialup – in fact, tests showed that we were getting barely double the speed! No doubt cable modem users were similarly disappointed, too. Now many of us ADSL users have 1.5 mbps or better connections – but somehow, it just doesn't feel like things are moving 20 times faster than they did on dialup.

 

There's a lesson in that experience, and that is not to be swooned by press releases promising the moon. As telcos and cable companies gear up for the next big round of upgrades, however, be aware that the (monetary) stakes are much higher, and that those of us who want to take advantage of download speeds fast enough to handle things like digital TV or video are going to be paying for the privilege. Hence the importance of having at least a rudimentary understanding of what you are going to be asked to buy and how it compares to the competition.

 

 

But that's probably not going to happen on a wide scale anytime soon, because as long as there are cheaper alternatives that can give cable companies and telcos a marketing boost, you can bet they're not going to do more than they have to in order to compete in the marketplace. Fiber To The Neighborhood is the cheapest upgrade path for a phone company, so Bezeq, with its digital entertainment partner YES, is without a doubt going to opt for that (note: like I said last time, I don't have any inside info. Call this a very educated speculation on my part).

 

 

So does this mean that cable is the way to go for a “triple play” (voice, data, and video) experience? If a customer were really going to get 160 mbps download, then of course we'd all be rushing to sign up with HOT. But considering that the cable company still is functioning with DOCSIS 1.1 standard (according to the HOT people), it might be awhile before the company decides it's worth its while to provide such a high data transfer rate.

 

 

 

The very technical answer has to do with the way cable modems work (the number of people on a node, how much equipment the company is going to set up to serve customers, etc.). In other words, it's the bean-counters, not customer service or technological developments, that is driving HOT (and, you can bet, Bezeq) to offering new services and higher transfer rates in an incremental manner. HOT's got 3.0 mbps? Okay, says Bezeq; we'll start rolling out FTTN and its faster VDSL modems gradually, first to the rich neighborhoods where people will pay for it, and eventually elsewhere. Then HOT will adjust its own investment strategies to compete with Bezeq. And so on. This is what will likely happen, of course, unless someone gets the radical idea of offering a genuine, far-reaching advanced technological capability that will appeal to customers - like Verizon has in the U.S. by making a solid commitment to FTTH, thereby speeding up the implementation of faster data technology significantly, as competitors struggle to keep up.

 

The bottom line for you, the customer, is how long after you invest in a VDSL modem or upgraded home cable switch/receiver, are you going to have to replace that new equipment? On paper, DOCSIS 3.0, which will require less infrastructure investment (it can use existing coax cable) looks like it might be a better deal, because HOT will be able to incrementally increase its download/upload packages until it squeezes the maximum out of DOCSIS 3.0 (or 1.1, for that matter). But remember – fiber optics are definitely going to show up in your home one day. Will it be cheaper to connect with those last few hundred meters from the fiber cable laying in the street, courtesy of Bezeq? Will HOT customers have to foot the bill for replacement of the existing cable network?

 

Considering that all this isn't going to take place for at least a few years, you have some time to think about how to spend your money – and you'll be able to ask some real good questions when the salespeople come calling!