Bell Atlantic testing video on demand

June 15, 1993|By Gary Rosenzweig | Gary Rosenzweig,Staff Writer

ARLINGTON, VA — ARLINGTON, Va. -- In the push to develop a new generation of services, Bell Atlantic Corp. demonstrated new technology yesterday that would enable people to view movies and other programs delivered over existing phone lines to their home televisions.

If this technology proves itself in current tests with employees' homes and a pending lawsuit allows telephone companies to provide video service, Bell Atlantic could be the first company to provide video-on-demand services to consumers.

AT&T recently announced it would be testing similar services, and other companies, such as Tele-Communications Inc. and Time-Warner Inc., are developing systems.

Art Bushkin, president of Bell Atlantic's Arlington-based Information Services, said the company has begun to install a primitive version of the service in 100 employees' homes in Northern Virginia. The test will grow to about 300 employees and include on-screen controls by next year, Mr. Bushkin said.

"This technology has worked in the labs, but this is the first test in the field," said Larry Plumb, a spokesman for Bell Atlantic, parentof Chesapeake & Potomac Telephone Co. of Maryland.

The system allows users to push the buttons on their telephones to select movies or other programs from a video library and view them at whatever time they choose. Bell Atlantic said up to 30 full-length movies would be available during the first phase of its test, which will last through the summer.

Michael Balhoff, an analyst for Baltimore's Legg Mason Wood Walker Inc., said he expects video-on-demand services to be marketed in metropolitan areas next year. The Baltimore-Washington area would be among the first areas to get this technology because of the density of its population and the affluence of the area, he said.

"I have no question that there is going to be head-to-head competition," Mr. Balhoff said.

Eventually, cable companies will be able to provide services over their networks that will compete with the telephone companies, Mr. Balhoff said. Bell Atlantic's push to develop video and interactive services is an effort not only to become a leader in this field, but to make it the preferred provider of video and telecommunications, he said.

Mr. Plumb said Bell Atlantic would like the system to have its first commercial use in the second half of 1994.

Movies that have been precompressed into packets of digital information and stored in a video server are sent over telephone lines to homes with special equipment that decompresses the video signals, he said. An Asymmetric Digital Subscriber Line, or ADSL, a newly developed device, allows this video signal to be sent over existing copper wires for about 18,000 feet without interfering with phone service.

Mr. Buskin said more than 80 percent of the households in Bell Atlantic's region are within the 18,000-foot range. "We will have, throughout our entire region, the ability to employ ADSL," Mr. Buskin said.

In future phases of the test, features such as pause, fast-forward, rewind and on-screen menus will be included, Mr. Buskin said.

The Bell Atlantic system melds technology developed by a number of companies, including Compression Labs Inc., which pioneered the video compression system; Northern Telecom, American Telephone & Telegraph and Westell, which provided the prototype ADSL system; and IBM Corp., which makes the video server, the repository for the compressed video signal.

In addition, 21 movie studios, television networks and cable stations will be providing movies and programs for the test.

The 1984 Cable Act restricts telephone companies from providing more than 5 percent of the video market but it does not prevent them from being the medium through which the services are provided. Bell Atlantic has challenged the restriction and its suit is scheduled to be heard in U.S. District Court in Alexandria, Va. Thursday.

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