Comcast Corp., the dominant cable television provider in the Baltimore area, said yesterday that it would launch a new service that would bring the Internet and computer on-line services into the home at speeds more than 50 times faster than the telephone modems of today.
The service, called Comcast PC Connect, is undergoing a technical trial at employees' homes in the Philadelphia suburbs, the company said. It is expected to advance to a market trial sometime in 1995 and to commercial rollout by the end of the year.
The company declined to say where it would offer the service first, but Baltimore could be one of the earlier markets to receive the service because of its high concentration of Comcast subscribers, company officials said.
In addition to the high-speed data link, the Philadelphia-based company also announced plans to launch an on-line service of its own, which would offer a broad range of information services -- including news, sports, classified ads and real estate listings -- geared to each market.
The move could present a significant challenge to daily newspapers' traditional domination of the local advertising markets, but it could also lead to new alliances. "We're definitely open to local service providers," said Kathleen Jacoby, Comcast's director of investor relations.
The service introduced yesterday seeks to capitalize on the dramatic increase in the number of households that have personal computers and use on-line services. Forrester Research Cambridge, Mass., predicts that there will be 42 million personal computers in American homes by 1997, up from 23 million today. Most home PCs sold today have free on-line service software bundled with the computer, contributing to the explosive growth of services such as America Online.
Ms. Jacoby said introduction of the service will not require regulatory approval, a drawn-out process that is bedeviling the nation's telephone companies as they attempt to upgrade their networks to compete with cable.
Comcast is the nation's third-largest cable TV operator, serving about 3.3 million subscribers, including residents of Baltimore, Harford and Howard counties. With yesterday's announcement, it joins a handful of other cable companies that have announced plans to roll out connections to home computers in other parts of the country.
"This is a burgeoning market for cable operators," said Rich d'Amato, a spokesman for the National Cable Television Association.
Currently, services such as American Online, Prodigy and CompuServe have been limited by the glacial pace at which data is transmitted, even with the fastest telephone modems on the market. Bringing up a picture on the screen, for instance, can take several minutes -- time during which the computer screen is frozen and the customer is paying.
The slowness is the result of the limited bandwidth of traditional copper twisted-pair telephone wire. Ms. Jacoby said Comcast's coaxial cable link to the home is now able to carry data at 50 times the rate of a 14,400 baud modem, the current standard. By the time the service is introduced, that could be improved to several hundreds times faster, she said.
The computer service is one of several ambitious ventures taking Comcast beyond its core business.
The company recently joined a venture with Sprint Corp., Tele-Communications Inc. and Cox Cable Communications that plans to offer a comprehensive package of local and long-distance telephone services. That group is a leading bidder in the Federal Communications Commission's current auction of radio spectrum for advanced wireless phone services.
The Comcast PC Connect service is not directly related to the company's telephone initiatives, but will be an enhancement to the basic cable service, said Joe Waz, Comcast's vice president for external affairs.
Over the long term, however, the computer service could be offered as part of a package of telephone and cable services that would compete with the offerings of companies such as Bell Atlantic, according to Mr. Waz.
"The Comcast goal is to be a single-source provider of the full range of telecommunications needs," he said, noting that regulators would have to rule on any "bundling" of services.
The high-speed service would be a boon to the existing on-line companies, which are eager to expand their offerings into full-motion film clips, software distribution, video chat lines and other applications. Comcast said America Online and Prodigy have been helping it develop the technology for transmission over cable.
The new service will also let customers connect to the Internet, the network linking computers world wide, either directly or through an on-line service, Mr. Waz said. He said he was not sure whether there would be an added charge for Internet access.
Mitch Ratcliffe, editor-in-chief of Digital Media magazine, said there will likely be a healthy market for such services.
"A lot of people would be interested in getting broadband communications in their homes," he said. "The problem is, a lot of people don't like their cable company."
Ms. Jacoby said Comcast will roll out the service in markets where it has completed an upgrade of its cable network. She said the upgrade program is under way in the Baltimore area and would likely be completed by 1996.
The specific price of the service will be determined in the market trial, but Ms. Jacoby said it would be comparable to that of running a second telephone line into the house -- about $8.95 a month.