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AT&T Trial Homes In on Home Networks

3/17/2002 7:00 PM Eastern

Subscribers love listening to digital music and accessing the Internet on multiple PCs, but they'd rather lease the necessary gear than buy it.

Those are some of the key findings AT&T Broadband gleaned from its recent five-month home-networking trial in Seattle.

The nation's largest cable operator — which is trying to shape its home-networking strategy — offered a trial service to 72 cable and high-speed-data customers in that Northwestern city, said senior vice president of advanced broadband services Susan Marshall.

She discussed the results at a Cable Television Laboratories Inc. media briefing held here last week.

The trial offered subscribers a free, managed system that could link their cable-modem-driven home computers to TV sets and stereos. AT&T discovered that subscribers most often used the network to link multiple PCs to peripheral devices and to share MP3 and CD audio files.

In fact, the participants said they spent more time listening to audio with the home server and the file-sharing technology. By way of contrast, they didn't change their TV viewing habits very much, but Marshall attributed that to a somewhat hastily assembled personal video recording feature.

"We think it was more our ability to provide a meaningful experience, that people really wanted to see that," she said. Subscribers also wanted a lot of on-demand content, she added.

As a result, she said, "we think that and [digital video recording] is going to be pretty critical in terms of developing different services and revenue streams for our company."

Customers also preferred a monthly package offered for a fee, with installation provided. But the trial group didn't want to plunk down cash for equipment. Instead, they wanted to lease it, rather than risk being left with obsolete gear.

"With this, people are recognizing that technology is changing so fast that they want to lease," Marshall noted. "They really expect that the service provider is going to install it."

While the trial did produce loads of customer-usage information, it did not provide a strong read — as yet — on how much customers were willing to pay.

"People in this trial were fairly price-sensitive," Marshall said. "But we didn't do a lot of work around this."

AT&T Broadband has an opportunity to get in on home networking in its early stages, given it already provides cable-modem service.

"We just did a deal with EarthLink [Inc.], and they have a home-network solution. [America Online] has a home networking solution," Marshall said. "Everyone wants to own the home network."

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