That's particularly true as companies strive to connect to offices. The residential market is frequently touted as "fast-growing," but only a tiny fraction of U.S. homes have digital subscriber line (DSL) or cable-modem connections, and there's no immediate prospects for a boom in demand (broadband players everywhere mourn the loss of Napster, the closest they've ever come to having a killer app). Businesses could prove more lucrative both in volume and in the expensive services they might require-but they also need a higher level of reliability in their network connections. Separately, DSL and cable modems also need ways to fend off emerging broadband contenders such as Ethernet in the first mile or passive optical networks.

Leaving aside the questions of regulations, or of how strong demand truly is, some interesting technology is brewing in the rival camps for cable modems and asynchronous digital subscriber lines (ADSL), each of which needs new tricks to state its case for "convergence"-the almighty overlapping of voice, video and data services.

For example, Alcatel announced in December a TV-over-DSL capability that was "clearly a shot across the bow to cable that they're not the only ones that can provide video," said Jay Fausch, senior marketing director for Alcatel USA. "Ethernet, coax, copper and fixed wireless are all competing ultimately for some of the same turf."

As well, most other DSL players have added video to their list of applications. Lucent Technologies Inc., for example, is touting its Stinger DSL product as a platform for video as well as voice and data.

ADSL has always been capable of carrying MPEG-2 video, but within limits. A standard-definition TV channel consumes between 2.5 and 4 Mbits/second of bandwidth after MPEG-2 compression, so that ADSL's 8-Mbit/s maximum download speeds are enough for roughly two channels, said Bruce Miller, senior product manager for Lucent.

"You turn it on, that's 3 megs of constant data. You never see that with Internet traffic," Miller said.

Still, there have been improvements. The 2.5-Mbit/s figure alone is the result of improved compression algorithms, bringing video's bandwidth budget down from about 4.5 Mbits/s, said David Benini, vice president of marketing for Aware Inc. "Suddenly it's not as much of an issue," he said. "You really can do video."

For that reason, many companies are banking on VDSL, a successor to ADSL that can deliver 13 Mbits/s symmetrically or as much as 26 Mbits/s of downloading speed in asymmetric configurations. But with VDSL still in early deployment, some vendors are developing alternatives to boost ADSL's 8-Mbit/s bandwidth.

"What it's going to look like when it gets out is anybody's guess, but the interest is there to extend the capabilities of DMT [discrete multitone] ADSL and to do it in a way that confers with industry standards," said Alcatel's Fausch.

This is hardly surprising; ADSL itself is the latest in a series of tricks to get faster speeds on copper lines. Conventional modems topped out at 33.6 kbits/s until the V.90 standard kicked them up to 56 kbits/s. DMT divided the copper-line frequency spectrum into 256 subfrequencies, each capable of carrying its own set of signals. Grouped properly, this arrangement theoretically provides 8 Mbits/s in total bandwidth.

In March 2001 Aware announced Fast-ADSL jointly with longtime partner Analog Devices Inc., and the latter produced the 8020 chip that uses the technology. Fast ADSL provides speeds of up to 11 Mbits/s in a radius of roughly 5,000 feet. But it hits the same distance limitation as ADSL, matching ADSL's 8 Mbits/s at 9,000 feet and falling off at the same decay rate. Fast ADSL thus doesn't address the issue of extending DSL's reach, or of accelerating the service to customers extremely far from a central office.

Other tricks to improve ADSL include Trellis coding, adding spectrum to the line, or "squashing" the POTS spectrum, Fausch said. Not all of these are ADSL-standard. Transmissions can be speeded up using proprietary algorithms applied on the end user's side of the connection, something implemented in many existing ADSL modems.

Texas Instruments Inc. plans to develop a programmable engine that uses ADSL framing and signaling but with software that can be altered to accommodate different nonstandard options. Speeds of 20 Mbits/s might even be possible, in a setup using TI chips on both sides of the connection, said Shankar Bala, TI marketing manager for central-office equipment. "ADSL+ is being looked into in detail for next-generation devices," he said.

On the cable-modem side, service providers are eyeing a territory dominated by incumbent local-exchange carriers: business customers, whose IT spending dwarfs that of residences. In the United States, there are still 8.3 million small- and medium-size offices within reach of a hybrid fiber/coax plant, said Steven Burt, chief financial officer of Advent Networks (Austin, Texas).

For cable operators, the IT spending produced by eight business subscribers could match the revenue derived from more than 100 residential customers, Burt said. The boost in revenues would be a plus for the cable industry. "They've been downgraded to a utility stock rather than a growth stock. They need to look at opportunities for growth," Burt said.

For that reason, most large networking vendors-and some specialists, such as Advent and Narad Networks-are working on making cable enticing to businesses.

Among the stumbling blocks is the shared nature of cable modems, which means that groups of users have a collective cap on available bandwidth. MSOs have even resorted to deploying DSL or T1 lines-doing the work of a telephone company, essentially-to connect their corporate clients, Burt said.

Advent skirts the issue by providing a dedicated Internet Protocol connection across an HFC line. It's not compliant with the data-over-cable system interface specification standard (Docsis) for cable modems, but that's less of a priority when chasing business customers, Burt said.

"What we've been told by the MSOs is that they require Docsis for a residential setting, but for a business, they'd [be willing] to go with something proprietary," he said. Advent's Ultraband systems retain the Docsis physical layer but top it off with a proprietary media access layer.

Cable is also seeing a push to add voice services, which would complete the voice-video-data triad that every broadband camp is pursuing. "We think that the new competition for the telco is the cable company," said Kevin Woods, vice president of marketing for Tollbridge Technologies Inc.

Tollbridge is among the companies trying to bring voice-over-IP to both cable and DSL.