Apple unveiled its iTunes movie download service yesterday, which is very nicely done from a customer experience perspective. But many people are likely to be frustrated with download speeds. Apple talks about 30 minutes to download a feature length movie, but the company noted that is if you have a 5-6 megabit cable modem connection. About 60% of broadband users have cable modem connections, and many of them are supposed to be three megabits/second or more, but few actually deliver that. The cable companies coyly use the phrase "speeds UP TO 6 megabits," meaning snowballs in heck will likely freeze solid first.
My home is on an Adelphia system now owned by Cox, and I rarely see speeds of much more than 1 megabit/second. Sometimes I see more, but last night, as an example, I was barely getting 500kilobits/second. The problem with cable and wireless systems that promise huge speeds is that you share that bandwidth with other local users, so the theoretical maximum the marketing people love to tout is just that--theoretical--as in, if you are the only person on the Internet in your local area. Which almost never happens unless you work the night shift and tend to be up at 4 AM.
We observed this phenomenon many years ago when I was still running the Blacksburg Electronic Village. In the afternoon and evenings, people go home and get online, and do so much more now than then. So if everyone pushes back from the dinner table about 6:30 PM on Friday night and decides to download a movie instead of going to the video rental store, you won't be getting that movie in anything like 30 minutes. It will more likely be a couple of hours, or even longer. Dedicated download enthusiasts will start downloads the night before and go to bed while pulling the movie down.
This is why cable and phone company promises of 5, 10, or even 30 megabit speeds are grossly inadequate. Apple's highly compressed movie offerings don't even match current DVD quality; they had to do this to make it possible to download them at all over current broadband systems. But as more and more people demand to watch movies in HD format, the current copper-based "broadband" network in the U.S. (i.e. cable modem and DSL) is simply not up to it. A high quality HD video stream requires 18-20 megabits/second for a single movie, and if you two of you in the household want to watch different movies at the same time, you are right up to around 40 megabits/second, just to watch a TV show or movie.
And despite promises of 54 megabit and 108 megabit wireless systems, those are the theoretical maximums, not the real world average throughput. For any wireless system with multiple users (almost all neighborhood systems), a simple rule of thumb is to divide the maximum throughput by 10 to get the likely "good" bandwidth you will see most of the time. So a 54 megabit wireless system might be able to deliver 5 meg/second when usage is moderate. On Friday nights, you might be lucky to get 1 megabit consistently.
Communities need fiber, for business and for entertainment, and to make the system pay, you need both kinds of content. As Design Nine helps more and more communities design true Open Service Provider Networks (OSPNs), our financial models consistently show that you can't just build out to business or just to residential neighborhoods and make the network pay for itself. You need to bring both market segments into an integrated business plan.