Alcatel plans to unveil the fifth version of its DSL access multiplexer this week, a unit that adds a significant amount of capacity and also positions the company to step into the increasingly hot video services market. The 7301 Advanced Services Access Manager is built as a derivative of the company's workhorse, the 7300 multiplexer, but on a much larger scale.

“Bandwidth demand is on the rise,” said Jay Fausch, senior director of marketing for Alcatel's broadband division. “We're not just seeing fatter and fatter content — we're starting to see the effect of multi-PC locations.”

In raw capacity, the 7301 uses a 170 Gb/s backplane to handle about 30 times the bandwidth and five times the number of users as the 7300. A fully loaded 7301 accommodates about 10,000 users. Upgrading from the 7300 requires replacing a network termination card on the main shelf and an extender card in each additional shelf, plus a software upgrade. The new DSLAM can be used for a number of applications, such as an aggregation point for other DSLAMs. “You could have the six nodes feeding into a hub and those six nodes could have nodes hanging off of them,” Fausch said.

While Alcatel initially is banking on the 7301's enhanced grooming abilities to appeal to the largest carriers, the new box also provides a glimpse into Alcatel's video strategy. With as much bandwidth as the new DSLAM provides, the company has included a 622 Mb/s broadcast video bus that won't compete with data service for backplane capacity. Assuming video can be compressed down to 2.5 Mb/s, that leaves enough capacity for more than 200 channels.

Alcatel's unveiling of the 7300 comes, perhaps not coincidentally, as telcos are expressing renewed interest in all forms of video. With the expected rollout of ADSL2plus — which significantly improves speeds over loops up to 9000 feet — toward the end of this year, carriers will be given the bandwidth necessary to provide video service.

“Anything that will expand the data rates of ADSL will help the economics, particularly ADSL2 or [ADSL]2plus,” said Michelle Abraham, senior multimedia analyst with In-Stat/MDR, saying improvements in video compression are equally important.

Abraham issued a report last month that said pockets of telco video activity are emerging in the U.S., while Asian and European operators are moving full bore into the market. “Some of the early telcos were using 6 Mb/s per channel,” she said. “Now they can take that down to about 3 Mb/s and still get pretty good quality.”

In fact, technology has improved enough that some of the larger independent telcos have issued significant requests for proposal. And though RBOC video has been limited to Qwest Communications' VDSL deployments in Phoenix and Denver, others have started expressing interest. For example, BellSouth is exploring video multicasting technology that could be packaged as part of its DSL service.

“We're seeing a lot more movement in the Consumer Electronics industry toward combination entertainment/PC devices,” said Bill Smith, chief technology officer for BellSouth. “We're going to see a point where you could easily use DSL for entertainment.”

Alcatel's announcement, which came less than a month after the company's acquisition of iMagicTV, is significant in part because of its market share, and the fact that the company is the primary supplier for three of the four RBOCs as well as Bell Canada (see figure). It's also the first in what is expected to be a flurry of DSLAM vendor announcements related to video.

Lucent Technologies, which has put most of its efforts into the Stinger DSLAM designed for remote terminals, is planning to announce several video-related improvements at the Supercomm 2003 show in Atlanta next month.

“We have a program that will significantly increase the throughput of the currently shipping backplane,” said Donald Crowe, director of product management for Lucent's broadband group. “It's got quite a bit of latent bandwidth that we're going to exploit.”

Just how the larger carriers will use that bandwidth, however, is unknown. While it's possible that the RBOCs will begin offering broadcast services, issues such as their large ATM infrastructures may slow that effort. More likely is some form of video-on-demand service using IP multicasting technology.

“Two years ago I would have said DSL is never going to meet the needs of entertainment services,” said Smith of BellSouth. “It's not a done deal, but if you look at what [personal video recorder] functionality is doing to the entertainment market, it's starting to get people to stop worrying about watching entertainment on someone else's schedule.”