December 20, 2001
(Computerworld)
Unless AT&T Broadband and Comcast Corp. change their policies toward business broadband users, the merger of the two companies will result in the creation of an even larger entity typified by a user-hostile approach to remote workers and small businesses, according to analysts and users.
While AT&T Comcast Corp. is being hyped as a competitive alternative to local telephone companies for high-speed data services, Mark Kersey, an analyst at ARS Inc. in La Jolla, Calif., said the companies' policies will force users to choose "between the lesser of two evils [for broadband] -- the phone company or the cable company. You get to decide which is less evil."
AT&T Corp. agreed to merge its cable television and broadband unit with Comcast Corp. in a $72 billion deal, creating a new company called AT&T Comcast Corp. (see story).
Philadelphia-based Comcast has a policy in place that forbids the use of virtual private network (VPN) clients over a residential connection, while AT&T this month instituted a 1.5M bit/sec. cap on download speeds when it shifted users to its own network from the bankrupt At Home Corp. VPNs provide remote workers with a protected tunnel to corporate servers through the Internet, guarding data against penetration by hackers.
Sarah Eder, a spokeswoman for Englewood Cliffs, Colo.-based AT&T Broadband, said the company eventually intends to introduce tiered packages that will provide higher speeds at higher prices, though she declined to disclose the pricing.
Eder added that the company intends to sharply limit the amount of data a user can download in a month without paying a higher fee. "We're in the a la carte business now," Eder said, adding that AT&T Broadband can no longer support At Home's "all you can eat" policies that led to abuse of the system. "One percent of our users in places like Silicon Valley account for 30% of our traffic," Eder said.
Comcast offers a telecommuter service that supports VPNs but charges $95 a month, compared with $39.95 a month for residential service. The company's Business Communications subsidiary also offers a range of corporate broadband services priced from $150 to $695 a month depending on the length of the contact and speeds, with a 2M bit/sec. connection downstream and 512K bit/sec. upstream service commanding the top price.
"Those prices will have to come down" if the new AT&T Comcast wants to make inroads in the corporate broadband market, Kersey said.
Peter Gnas, network administrator at Wixon Fontarome Inc., a St. Francis, Wis.-based bread-mix maker that recently switched its field sales force from dial-up to broadband to support bandwidth-hungry XML applications, views the VPN ban as equivalent to "charging people extra for speaking another language on the telephone. I'm disturbed they charge extra for services like VPN."
Microsoft Corp. will own 115 million shares of the new AT&T Comcast through conversion of AT&T shares into new stock, and Gnas finds the existing Comcast VPN ban puzzling, since Microsoft "has built VPN support into Windows XP." Kersey suggested that Microsoft's holdings in AT&T Comcast and its desire to penetrate homes with broadband to support new Microsoft-driven appliances could lead to a re-evaluation of the VPN policy. "It would seem to me that Bill Gates would like to see the lowest-priced broadband possible," Kersey said.
Gnas added that if cable companies want to charge extra for "business class services" then they should follow up with business class service to the customer, including quality-of-service guarantees and "real support, rather than the usual less-than-quality support."
Eric Hoyt, a structural engineer at Weidlinger Associates Inc., an engineering firm in New York, said the cable companies have targeted the wrong people with their restrictions on business users. Stress on a cable broadband network doesn't come from business users but from people who are "downloading music and movies." In Hoyt's view, charging extra for VPN service "is like charging you more for gasoline depending on what kind of car you drive."
Jack Nilles, president of JALA International Inc., a management consulting firm in Los Angeles that specializes in telecommuting, doesn't have much hope of AT&T Comcast providing better service for business users based on his recent experience with AT&T Broadband over VPN support. Due to lack of commitment to customer support, Nilles said he advised a large client to opt for telco Digital Subscriber Line service rather than cable. "Cable companies have always had user-hostile policies," Nilles said.
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