New Turnkey Data Provider Emerges

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A new, do-it-all high-speed-data provider will enter the
already-crowded turnkey segment this week, with plans to differentiate itself from the
others by providing its own, homegrown equipment.

Cable Web Services Inc. is a Philadelphia-based company
with three years of development under its belt, 14 employees and high hopes to help East
Coast operators easily slip into high-speed-data services.

The company's approach is largely dismissive of
pending cable-modem standards, known as DOCSIS (Data Over Cable Service/Interoperability
Specification). CWS came up with a proprietary approach that is "considerably more
cost-effective" for small and midsized operators, said Steve Getz, the company's
founder and chief technology officer.

CWS will install and maintain its equipment, dubbed
"HomeStream," at no charge to the operator. That's why it was important to
CWS' business model to come up with a cost-effective product, Getz said.

He added that CWS kept its cable-modem-headend costs at
$10,000, compared with $40,000 to $100,000 for competitors, "by keeping the software
smart and the hardware dumb, so that we can drive the manufacturing cost as low as
possible."

For subscribers, CWS will provide a slide-in personal
computer modem card that enables data rates of 6 megabits per second for every 6-megahertz
channel in the downstream direction -- even if that 6-MHz channel is located in the deep
roll-off or in ingress-addled spectral regions, Getz said.

For modulation, CWS is using a mixture of TDM
(time-division multiplexing) and VSB (vestigial sideband) that "offers any number of
service tiers," Getz said.

Everything about the CWS approach goes against the grain of
a growing, industrywide swell toward standardized modems.

Mostly, CWS thinks that industrywide projections for
two-way plant are vastly overestimated, and that standards cripple the flexibility,
creativity and speed to market of a service like high-speed data.

CWS is entering a market that is already bloated with
competitors like Convergence.com, HSANet, ISP Channel, Internet Ventures Inc., Online
System Services Inc. and the latest Goliath, @Home Network, which also plans an aggressive
courting of small and midsized MSOs.

"We're not kidding ourselves here -- our market
position is daunting, at best," Getz said.

CWS has scored a trial with 50 apartments in a
Philadelphia-based multiple-dwelling unit served by MetroCable.

Gary Arlen, president of consultancy Arlen Communications,
said he thinks that CWS could score well if it sticks with MDUs.

CWS is funded at $2 million now, and it expects another
"major round" within the next few weeks. "Our business model is
sustainable," Getz said. "We're not giving away the equipment to entice
orders. That's built into the model."

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