DSL's RETAIL EXCURSION NO EASY SALE

The DSL Forum is attempting to bring its flagship product into the RadioShacks and Circuit Cities of the world, announcing last week a retail initiative to sell asymmetrical DSL modems in much the way broadcast digital satellite or cellular phones are today.

The forum's logic is that multiple channels, especially one as prominent as consumer retail outlets, will drive the technologies growth, propelling it past cable in the broadband race.

“Now carriers are having to find the consumer in their marketing efforts,” said Bill Rodey, president of the DSL Forum, which announced the interoperability initiative at a forum meeting in Chicago. “The consumer, however, finds the retail chains.”

While the strategy may be sound, implementation will have pitfalls, analysts said. Cable operators tried the same tack two years ago only to be met with a lukewarm response from the buying public. The MSOs went back to their direct sales model.

But the cable providers never really pursued the model in earnest, said Yankee Group analyst Ryan Jones. AT&T Broadband, which led the effort, placed modems on shelves but required the same customer service steps and truck roll it used in its direct sales. Cablevision Systems had the advantage of owning its own retail outlets but has pulled back.

If DSL providers can implement a full self-service install, improve the provisioning process and market the service properly through multiple channels, they might be able to succeed where cable failed, Jones said.

“Whoever perfects that relationship between the carrier and the retailer will have a significant advantage in the broadband market,” Jones said. “One of the reasons why cell phones and [direct broadcast satellite] are so popular is because of that retail exposure.”

The forum has set the goal of January 2003 to get the first ADSL gateways on shelves. Rodey admits the industry will still be working out provisioning issues by then, but the forum hopes to at least have a retail presence by next year.