AT&T Sewing up Jacksonville Trial

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AT&T Broadband confirmed this week that its open, multivendor trial in
Jacksonville, Fla., which was designed to foster competition, is coming to a
close.

MSO spokesman Steve Lang said the company is in the process of switching back
to equipment made by its dominant supplier, Motorola Broadband Communications
Sector. Lang said it remains more cost-effective for the company to use a
uniform architecture across its cable properties.

A source familiar with the trial echoed that sentiment, but added that
linking other vendors' equipment and software to the Motorola Broadband-based
system proved to be quite a challenge. 'It was like connecting an Apple
[Computer Inc. computer] to a PC,' the source said.

MediaOne Group Inc. (now part of AT&T Broadband) announced the digital,
multivendor pilot in February 1999, becoming the first U.S. operator to use an
open conditional-access platform capable of accommodating digital boxes from
more than one manufacturer in the same system.

Specifically, the MSO used Philips Consumer Electronics Co.'s set-tops, Canal
Plus S.A.'s 'MediaHighway' middleware and DiviCom Inc.'s (now Harmonic Inc.'s)
headends.

Among its features, the pilot offered customers a lineup of digital
programming, impulse pay-per-view and a channel guide.

One industry source familiar with the situation said thousands of customers
were involved in the pilot, but AT&T Broadband has declined to provide
specific figures.

Industry sources said one aim of the Jacksonville test was to break the
'lock' Motorola Broadband and Scientific-Atlanta Inc. hold on a proprietary
signal-scrambling technology called DES (Data Encryption System).

Today, DES is a Society of Cable Telecommunications Engineers-published
standard, but it doesn't include some encryption secrets vendors must obtain
through licensing agreements.

The open-access control elements AT&T Broadband used in Jacksonville for
conditional access were based on Europe's popular Digital Video Broadcasting
standards. OpenCable, however, will use DES inside point-of-deployment modules,
which are credit-card-sized devices that fit snuggly inside standards-based
set-tops.

The shift to a multivendor cable environment has already worked as OpenCable
specification development continues. For example, AT&T Broadband has inked
box deals with Philips and Panasonic Consumer Electronics Co., although Motorola
Broadband remains the MSO's largest supplier.

Meanwhile, Time Warner Cable, which uses S-A as its dominant set-top source,
has ordered set-tops from other sources such as Pace Micro Technology plc and
Pioneer New Media Technologies Inc.

Another goal of the trial, sources said, was to help usher in an age in which
cable set-tops ran in line with the much faster and perhaps more innovative
consumer-electronics development cycle.

Despite plans to sew up the trial in Jacksonville, Lang said, the MSO remains
solidly behind the OpenCable initiative.

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