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coaxial cable network to prevent the signal from degrading over distance and producing noise or distortion. Finally, a drop cable is run from the feeder cable into a subscriber's home and is attached to the television set.

Channel capacity for cable systems has grown from an average of 12 channels, mostly retransmission of broadcast signals, to an average of over 40 channels today. The number of cable subscribers served by systems with 30 channels or more has doubled from 48.7 percent in 1983 to 95.4 percent in 1993. Channels provided now include satellite delivered cable programming, and a variety of new educational, shopping, and entertainment networks. Using this same architecture as a platform, cable companies are currently exploring their role in the NII by initiating new applications and offering access to other networks and resources, such as the Internet. The expansion of cable's role in the NII requires building on the foundation that was laid over the last 20 years.

The Role of Fiber Optics

The cable industry has been upgrading its coaxial cable infrastructure into a hybrid fiber optic/coaxial cable (HFC) network. Cable companies have installed fiber-optic trunk lines to replace these major arteries of the cable architecture with wider bandwidth (higher capacity) links. Optical fiber is constructed from thin strands of glass that carry light signals faster than either coaxial cable or twisted pair copper wire used by telephone companies. It allows signals to be carried much greater distances without the use of amplifiers, which decrease a cable system's channel capacity, degrade the signal quality, and are susceptible to high maintenance costs. With further upgrades, hybrid coaxial/fiber technology will also be able to support two-way telecommunications. Therefore, a broadband cable network that is capable of delivering more channels as well as high-quality voice, video, and data can be created without replacing the feeder and drop lines with fiber optic technology. This is the reason that the cable industry is perhaps the best positioned industry to deliver on the promise of the NII with a reasonable and prudent amount of investment.

Cable companies began widespread installation of fiber technology into the trunk of the cable architecture during the late 1980s. This use of fiber improved signal quality and lowered maintenance costs. In effect, fiber upgrades paid for themselves in terms of immediate cost reductions and service quality improvements. At the same time, the installed base of fiber served as a platform for further deployment of fiber to serve new business objectives.

In the early 1990s, cable further pioneered the installation of "fiber trunk and feeder" architecture in some of its markets. This approach runs fiber deeper into the network, segmenting an existing system into individual serving areas comprising roughly 500 customers. Time Warner provided a "proof-of-concept" of this approach in Queens, N.Y., with its 1-gigahertz, 150-channel system completed in 1991.

This evolutionary step offered a number of benefits. Backbone or trunk fibers may carry a multitude of available cable channels out to fiber "nodes," and remaining coaxial cable to the home can carry a particular targeted subset of the available channels. Thus, customers may be presented with more neighborhood-specific programming. Penetration of fiber deeper into the network also reduces the number of amplifiers, or active electronics, remaining between the subscriber and the headend. In some designs, amplifiers may be entirely eliminated, resulting in a so-called "passive" network design. Removal of amplifiers considerably simplifies the use of the coaxial cable for return signals from the home or office back to the headend and beyond. The portion of bandwidth reserved for return signals, usually in the 5- to 40-MHz portion of the spectrum, is often subject to interference and other impairments. Any remaining amplifiers must be properly spaced and balanced, a labor-intensive process that must by performed on an ongoing basis. Other technical impairments are unique to the return path, and technical solutions must be optimized. These obstacles are the focus of current industry research and product development. A Cable Television Laboratories (CableLabs) request for proposals issued in the fall of 1994 has spurred a number of technology companies to accelerate the refinement of technology to address return path issues. It appears that the full two-way capability of the coaxial cable, already installed to 90 percent of homes, will be fully utilized beginning in the next 12 to 18 months.

Full activation of the return path will depend on individual cable company circumstances ranging from market analysis to capital availability. There may be intermediate strategies employed by some of these companies to speed the deployment of two-way or interactive services. Such strategies might include alternative

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