Pace Says It Has an ADSL Set-Top Box

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Efforts by telecom operators to deliver video over digital subscriber lines received a boost when Pace Micro Technology said it would develop a National Television Systems Committee broadcast standard-compatible set-top box designed specifically for asynchronous DSL.

The European version of Pace's "DSL4000" gateway box is being used by Kingston Communications in the U.K.

Pace's entry into the U.S. DSL market-which follows Comcast Corp.'s order of 350,000 Pace cable set-tops this summer-comes as video over DSL is slowly gaining market acceptance.

The clear leader in delivering video over copper is Qwest Communications International Inc. About 50,000 Qwest customers in Phoenix receive video service via very-high-speed DSL (VDSL) technology. The company is in the process of evaluating its VDSL plans and talking with vendors to lower equipment costs.

Meanwhile, video over copper received a major endorsement this summer when Blockbuster Inc. and Enron Broadband Services announced a movies-on-demand via DSL service with partners Verizon Communications, Qwest, SBC Communications Inc. and Covad Communications, among others.

Despite a relatively low number of subscribers to date, "I certainly believe the (DSL video) market is going to grow," said Michelle Abraham, senior analyst for Cahners In-Stat Group, a sister company to
Multichannel News
.

Abraham predicted that by 2005, 7 million households would subscribe to video-over-DSL service. Most of those homes would use VDSL as their primary means of receiving television.

"We believe the market for DSL is going to be huge," said Andy Trott, Pace's chief technology officer.

The DSL4000 is a first-generation device, Trott said, and future versions will address one of video over DSL's main drawbacks: picture quality.

Delivering high quality MPEG-2 (Moving Picture Expert Group) video over ADSL is a fundamental physical problem, Trott explained. It requires very high-quality copper connections between a DSL access multiplexer in the central office and the subscriber, he added.

The remedy is the development of a video codec based on MPEG-4, which delivers high-quality video at much lower bit rates, according to Trott.

Pace's next-generation DSL boxes will support MPEG-4 video. The company is currently evaluating video codecs from Real Networks Inc., Trott acknowledged.

Trott also left the door open to future versions of the set-top that would include personal video recording and home networking capabilities. Voice-over-DSL functionality is also on the set-top's development roadmap, said Trott.

The DSL4000 includes an Ethernet interface, Java support and an ARM (Advanced RISC Machine) central processing unit. The box runs the RISCOS operating system, developed by Element 14, whose set-top business Pace purchased last year.

Trott offered strong hints that Pace is talking with companies involved in the Blockbuster-Enron VOD venture about supplying a set-top.

Telco powerhouse SBC, meanwhile, is preparing for a trial of the service next year involving about 5,000 consumers in two or three markets, company spokeswoman Kristen Hendrix said.

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