5/1/00 Telephony (Pg. Unavail. Online)
2000 WL 7092206
Telephony
Copyright 2000 by Intertec Publishing Corporation, a PRIMEDIA Company. All
rights reserved.
Monday, May 1, 2000
BANDWIDTH
Pepperoni, mushrooms and IADs
Bridget Mintz Testa
Carriers please their palates with integrated access devices
It's easy to see why end users are snapping up pizza-box-sized
integrated access devices almost as if they were pizzas. Mention voice
and data (and ultimately video) over one line for an entire office, with
faster, better services, and customers can't wait to sign up. Prices
aren't bad, either. Baseline units cost less than a fully outfitted PC,
although prices rise as features are added.
But what's in integrated services for the carrier? "It depends on the
carrier," says Beth Gage, director of broadband consulting at
TeleChoice. "Especially for DSL-based IADs, it lets a [competitive local
exchange carrier] come in and lease one copper pair and provide a lot of
services across it. That really reduces the costs of services. Instead
of paying for 24 voice lines, you can pay for one copper pair at $20 per
month. It also helps them move bundled services down-market and open up
new markets, such as small and medium businesses."
Delivering bundled services to end users is a wonderful retention tool
for the carrier, says Christin Flynn, an analyst with The Yankee Group.
"The principle is to make the life of the end user much easier." And of
course, the other goal is to make the mere thought of moving to another
service provider much harder. IADs are perfect for service providers
putting in new networks, building out in new areas or building converged
networks, Flynn says. "IADs let the carrier resell [incumbent] LEC
services," she says. "The carriers are growing their own services and
migrating resale customers to their services. IADs are perfect
opportunities for that."
Where do integrated services fit into service providers' business
models? Four providers - Intermedia Communications, Carrier Access
Corp., MCI WorldCom and TelePacific Communications - can answer that
question.
Intermedia:
First to the table
Tampa-based Intermedia began life in 1986 as a competitive access
provider, offering special access and private-line service to
interexchange carriers in Florida. Today it owns the fourth-largest
frame relay network, is the largest provider for top-tier shared tenant
buildings, is one of the top five Tier 1 ISPs and is a top five
interconnect company. Intermedia rolled out its "Single T" integrated
service in 1997, when most people were still learning to spell I-A-D.
"Our strategy is built around convergence," says Cheryl Mellon,
director of integrated local products at Intermedia. "We looked at
moving into facilities-based services back in 1996. The customer then
had multiple carriers. Intermedia rolled out all services across a T-1
line."
Single T service has always been aimed at customers with PBXs. This is
about 12% to 15% of the small and medium-sized business market, by
Intermedia estimates. The service combines local and long-distance voice
with Internet and data connections at the IAD and then transports it
across one T-1 line. Single T uses Vina Technologies' T1 Integrator, a
TDM-to-TDM IAD.
Voice and data at a low cost were top criteria in IAD selection.
However, at the time, no IADs could handle TDM-to-packet connectivity.
The T1 Integrator was selected because, Mellon says, "it was the leading
edge at the time."
Intermedia was Vina's first customer for the T1 Integrator. "Vina
Technologies in the early days defined a 'true' IAD - true including a
channel bank voice functionality plus integral data functionality and
routing," says Sab Gosal, Vina's senior product manager. "We wanted to
ensure capturing all the necessary features and functions to deliver
commercially available bundled services. Intermedia wanted to bundle voice and data services to differentiate themselves - they were looking
to define the next generation network."
What is the benefit of the T1 Integrator to Intermedia? "To provide
Single T service without bundling would require a voice T-1, an Internet
T-1 and a frame relay T-1," Mellon says. "The IAD replaces three T-1
lines with one. It's a cost savings to us and to the customer."
In June 1999, Intermedia deployed its second integrated services
offering, Unified Voice. This service offers customers either combined
long-distance and local voice or both plus Internet access. Unified
Voice targets the other 85% of the small and medium-sized business
market - customers with key systems or without phone systems. "It's a
line-side product with caller ID, call waiting, and other services,"
Mellon says.
Unified Voice uses CAC's Access Bank II IAD for customers that want
only voice - the device has no internal router. Unified Voice uses the
T1 Integrator for customers that want integrated voice plus Internet
access. "It's a cost factor," Mellon says. "If the customer doesn't have
data, do you need data capability?"
Though Intermedia was one of the first to roll out TDM-based
integrated services, the company wants to interconnect any customer's
legacy network -IP, ATM, time division multiplexing (TDM) - to its
frame relay network. In addition, Intermedia plans to offer frame relay
as part of Unified Voice during the next few months. Frame relay also
will be part of Single T within the next few months.
Intermedia is working with Vina and CAC in its trials. Vina rolled out
its MX packet-based devices last year, which will enable the migration
of Intermedia's TDM-based services to IP or ATM. CAC has developed a
new IAD with an internal router.
But Mellon's IAD wish list is lengthy, starting with more
cost-effectiveness. "I want an IAD that goes TDM to ATM, TDM or IP," she
says. Software must be scalable without truck rolls, and hardware must
be upgradeable without complete replacement. "Small and medium business
customers don't have big phone rooms, so the IAD needs to be small," she
says. Finally, Mellon wants dynamic allocation of bandwidth, something
not currently available because of the channelized nature of TDM.
"We are poised well with our extensive frame relay and Internet
portions and are using IADs to move to multiple transport media," Mellon
says. "We want to keep up with the technology, offer bundled services
and be a one-stop shop."
CTC:
IAD with everything on it
Before it became a CLEC and, ultimately, an integrated communications
provider (ICP), Waltham, Mass.-based CTC Communications Group operated
as the oldest, largest independent sales agent for Bell Atlantic (then
Nynex).
"The traditional customer has local, long-distance, Internet, frame
relay and Nx64 for videoconferencing services," says Frederic Kunzi,
chief technology officer of CTC. "The value proposition at CTC is to
converge all these services, except for POTS lines, onto a single IAD.
This provides better support and better service, and lowers costs by 10%
to 20%." CTC provides local voice services to its customers, but those
services are resold from Bell Atlantic.
About three years ago, CTC decided to build its own ATM-over-DSL
IntelliNET network, using ATM switches from Cisco Systems (Figure 1).
The Powerpath converged broadband access loop is provided to customers
via multiple T-1 or T-3 lines. Accelerated Networks' AN-30 IADs extend
ATM to the customer's doorstep, Kunzi says.
"Our IADs allow the end users to plug a T-1 or frame relay into it,
converting traffic to ATM and still maintaining [quality of service] for
voice," says Kevin Walsh, vice president of marketing for Accelerated
Networks. The IAD must use real-time variable bit-rate, echo
suppression, comfort noise insertion, silence removal and more to make
voice quality compare with that on the public network, he says. "There
is an extraordinary amount of technology in the IADs to do this."
CTC's business strategy is to initiate, transport and terminate all
calls -local and long-distance - so Class 4 and Class 5 switch
capabilities are required. However, "instead of buying Class 4/5
switches and putting them in COs, we will bring the whole network to
Class 4/5 capability," Kunzi says. IADs are crucial to this strategy.
It will work like this: A CTC customer - a medium-sized or large
business -will have its PBX, key system or hybrid phone system plugged
into the IAD. From the IAD, a call goes through to a call agent, which
maintains a database of phone numbers and features. If the call is on
the network, the IAD will establish a switched virtual circuit across
the network, Kunzi says. If the call is not on the network but must be
accessed via a gateway to another network, the call agent queries
upstream for the connection. Ultimately, the gateway to the other
network is contacted and the connection is established.
"This requires IAD functionality," Kunzi says. "If a customer has an
ATM switch, we can connect them directly to our network. But customers
who can afford ATM switches are very large. Medium-sized customers often
focus on frame relay. With an IAD, we can connect whatever the customer
has, even analog PBXs or analog key systems."
In January 1999, when CTC was looking for IADs, most on the market
were TDM-based. "We looked at about 30 IADs over a three-month period,"
Kunzi says. Ultimately, Accelerated Networks' IADs were the only ones
with ATM connectivity that could call connect to analog and digital
PBXs, link up to routers or video codecs or other customer equipment.
However, the IAD wasn't the whole story. "To connect up to their
long-distance carrier, CTC had to be able to convert ATM signals to TDM
channels," Walsh says. This requires a gateway, which Accelerated
Networks also had with the AN-3220. "It's somewhat ironic that
convergence only occurs in the broadband access network and that voice
and data get diverged at the POP," he adds.
CTC rolled out integrated services to a few charter customers in the
fourth quarter of 1999 and started full production in January. But
those customers can expect more features. Kunzi and his technical team
are implementing a long list of IAD capabilities. "It's an evolutionary
list, not a wish list," he says. "These things are tangible." The list
includes ATM voice compression, communication with the Class 4/5
switches and customer management and service modification via a
Web-based interface. "I'd like to have it all today," Kunzi says.
MCI WorldCom:
Large with extra customers
While CTC was rolling out integrated service in January, MCI WorldCom
was announcing its Smart Bandwidth on Command integrated service at the
ComNet show in Washington. The service is being rolled out first to
larger corporate and government accounts; smaller businesses are next.
Smart Bandwidth on Command includes a softswitch architecture, IADs,
customer access to call control and the ATM network itself.
"We've developed a softswitch architecture in which the intelligence
sits on servers attached to a data network," says Melanie Hanssen, MCI
WorldCom's ATM director. "All command and control is separated from the
switch. This is easier and makes us less dependent on switch vendors."
ATX-50 and ATX-150 IADs from Mariposa and AN-30 IADs from Accelerated
Networks can "front end any customer environment and allow the customer
to take advantage of ATM technology. And the customer doesn't have to
change equipment," Hanssen says.
For call control, the Web-based "customer cockpit" allows end users to
set up and tear down permanent virtual circuits and change bandwidth and
QOS parameters for themselves. As for the last service component, "ATM
is ideal for integrating voice, video and data. We can offer switched
virtual circuits and permanent virtual circuits," Hanssen says. "Our ATM
network is now more flexible and dynamic to support different types of
traffic."
MCI WorldCom had a long list of criteria for its IADs, Hanssen says.
"We wanted cool bells and whistles such as translation of SS7 signaling
to data streams and, especially for voice, anything which emulates PBX
capability," Hanssen adds.
"MCI [WorldCom] recognized that Mariposa had a unique solution for
common channel signaling [PBXs]," says Jay Shuler, director of
strategic marketing and business development at Mariposa. Most PBXs are
connected via primary rate ISDN, he says. "We pass all PBX signaling
transparently.
We fire off a bandwidth-on-demand switched virtual circuit based on
the dialed digits from the phone or the video codec. The IAD reads the
dialed number, knows where it goes, maps it to the destination address
from the server and sends off the broadband call." On the network side,
Mariposa's ATX 50 and ATX 150 IADs are scalable up to OC-3, starting from a T-1/E-1 connection.
Hanssen's wish list is short, but potent. "We'd like to see vendors
support really large customers," she says. Small vendors with
feature-rich IADs can't really scale up to support big customers such as
MCI WorldCom, whereas "large vendors like Cisco and Novell don't have so
many features," Hanssen says. The second item on Hanssen's list is
multiple-access options. "Some IAD boxes only support a T-1 interface,
but customers have multiple interfaces. So the IAD boxes need to support
them," she says.
By mid-year, MCI WorldCom expects to offer Smart Bandwidth customers
equipment and management options, and by the end of the year, the
company expects to have a public network gateway in place. In 2001, MCI
WorldCom plans to offer native IP and frame relay over transport types
other than ATM, Hanssen says.
TelePacific:
A taste for voice over DSL
Two-year-old, Los-Angeles-based TelePacific Communications is building
its own infrastructure and equipment and managing other companies'
networks. Its integrated service incorporates voice over DSL,
long-distance voice and Internet access services. The carrier is
expanding into select locations in southern California and Nevada, with
80 co-locations targeted by mid-2000. "Our network is converged from the
get-go," says Ken Bisnoff, vice president of strategic marketing and
business development for TelePacific.
TelePacific's business model is sharply defined. "The IAD model with
DSL transport and [voice over DSL] opens up one of the largest markets
out there: the four- to 12-line customer," Bisnoff says. "IADs make it
cost-effective for companies like TelePacific to go after that customer.
Previously, the break-even point in cost-effectiveness was 12 lines. Now
it's four. Our future is in providing those [integrated] services to
those customers."
Voice over DSL is the focus of TelePacific's integrated services
(Figure 2). "In the past, to provide 24 voice lines, you'd have to
deploy a T-1 line with channel banks," Bisnoff says. "Now with an IAD
and voice over DSL, you can use just a single copper pair to get 16 lines. A T-1 line costs $300 for the carrier vs. $11.50 for a copper
pair." Voice over DSL is packaged with long-distance voice and Internet
access, but other data services may develop. "With growth in bandwidth,
there will be video, too," Bisnoff says. However, TelePacific is not
interested in voice compression a la AAL2, which helped drive its IAD
selection process.
"At the time, other companies were looking at stuff like voice
compression," says Mike Lee, TelePacific's chief technology officer.
"Jetstream recognized that the usage pattern is that people are either
on the phone or using the Web. We saw no need to wait for voice
compression. Jetstream was the first to market with a [voice-over-DSL]
product." Essentially, TelePacific chose Jetstream because there were no
other voice-over-DSL contenders when it was making selections.
"Jetstream provides three elements to TelePacific," says Jeff Liebl,
Jetstream's marketing development manager. The first is a carrier-class
gateway device, the CPX-1000, which TelePacific installs in its
switching centers. The second are the IADs - the IAD801 and IADFLEX -
which are installed for customers who have fewer than 12 voice lines.
The third element is the network element management system - the JetEMS
- which manages th e gateway and the voice-over-DSL network.
Jetstream's IADs have analog and 10BaseT ports on the customer side.
"On the other side is wholesale T-1 or DSL," says Stephen Gleave,
Jetstream's director of marketing.
"We have to deliver a range of interfaces to the customer and to the
network side. Where there's no DSL, the IAD can interface with a T-1."
Liebl adds, "This is an advantage for TelePacific. They can run ATM over
DSL or T-1."
The CPX-1000 gateway is the bridge between the public and private
network. It takes packetized voice, converts it into channelized TDM and
sends it onto a Class 5 switch.
JetEMS can manage up to 500 IADs hanging off a gateway. Jetstream is
upgrading the gateways and management system so that a gateway can link
to 8000 IADs, and JetEMS can manage multiple gateways. Without such a
management system, upgrading each IAD would require at least one truck
roll - a prohibitive expense for any carrier, much less a 2-year-old
ICP.
Expense, while not a driving concern, is a factor on Lee's IAD wish
list. "Now we have voice and data," he says. "The next step is to
integrate the capability for videoconferencing into the IAD and do it
cheap." Lee also would like to see advanced features such as unified
messaging supported by IADs.
Too much of a good thing
Without these still-hot-out-of-the-oven IAD pizza boxes, carriers -
especially competitive carriers - would find it cost-prohibitive to
offer integrated voice and data services at all, much less offer them to
new markets. But there are downsides.
One is IAD management. Once a service provider locates IADs at the
customer premises equipment, then the size of the network grows by 10 to
100 times because the demarcation line moves to the subscriber side -
the CO is concentrating maybe thousands of IADs, says Accelerated
Networks' Walsh. "This carries huge implications for provisioning
services and for network management in general, and it is a concern for
carriers." Remote management of IADs requires suitable tools and
applications to enable automatic software upgrades, configuration
changes and the like without the need for people.
A second downside is of particular interest for carriers with legacy
networks. "Incumbents haven't jumped on [integrated services.]," says
Jeff Wilson, research director for corporate access at Infonetics.
"Between VPNs and convergence, they are wrestling with cannibalization
of core revenue streams. They are working up equipment depreciation
schedules." Incumbents must offer such services or be perceived as
antiquated, but they aren't aggressively promoting them. "If you're
saving your customers money," Wilson says, "you're saving them your
money, and you're buying new equipment. Neither is attractive."
---- INDEX REFERENCES ----
COMPANY (TICKER): Yankee Group (X.YNK)
MARKET SECTOR: Technology (TEC)
INDUSTRY: Consulting Services; General Industrial & Commercial Services; All Industrial & Commercial Services; Networking: |
