Cox takes stab at telephone business
rtonline1.roanoke.com
Saturday, August 09, 2003
Service not yet available commercially in Roanoke
Cox takes stab at telephone business
By GEOFFREY ROGOW
THE ROANOKE TIMES
As cable television companies move into the telephone business, Cox Communications has picked Roanoke to test its newest technology.
The technology, Voice over Internet Protocol, or VoIP, enables phone calls to transmit over the same kind of networks that carry Internet traffic. Last year, Cox tested VoIP in Oklahoma City, but executives decided Roanoke might be a better fit.
In late May, Cox began the technical trial at select homes in Roanoke. Cox competitors, such as Time Warner Cable and Comcast Corp., are testing similar technologies.
Most phone companies use more expensive circuit-switched voice networks, though some are beginning to integrate VoIP technology. The new technology can help bypass the traditional equipment and is promoted as a lower-cost alternative to regular phone service for subscribers.
Mike Pacifico, director of marketing for Cox Digital Cable, said VoIP would complement Cox's existing circuits that provide traditional phone service over cable lines in larger markets.
"VoIP offers us the ability to get into markets we are not currently in. We will take the service into those phone markets, which happen to be smaller and medium-sized markets," Pacifico said.
Because of Roanoke's size, it is an ideal location for the test, Cox officials said. Roanoke also has a robust hybrid fiber/coaxial network, which carries the signal, they added.
Cox hopes to eventually offer high-speed Internet, local and long-distance telephone service and digital cable to all of its customers over a single cable line.
"We want to get all of that on the same bill - one customer service, one provider," said Bobby Amirshahi, a spokesman for the Atlanta-based communications company.
The company isn't yet saying when it believes VoIP will be available commercially here.
Cox sees several advantages if it is able to find VoIP success. It would expand its phone service, offer more phone features, such as inexpensive second and third phone lines, and reduce costs. The company estimates it will save about 10 percent by providing VoIP services when compared to traditional phone service.
Glenn Russel, a director for PacketCable, a Cable Television Laboratories project that researches and develops VoIP technology, said companies enjoy stronger customer loyalty and a larger subscriber base when they are able to package several services into a single bundle. CableLabs is a Colorado-based cable research and development consortium.
Russell warned that regular phone service providers eventually will need to find a way to retain customers as the popularity of VoIP service grows.
As Cox continues testing, Sprint has already integrated a similar technology around Galax. Tom Matthews, a spokesman for Sprint, says that once the technology is in place nationwide, Sprint will only need 25 percent of the switches it now has.
Matthews said he sees competition more as an issue for Verizon in the Roanoke market. He questioned, however, the cost reductions Cox estimates and said that the VoIP network is costly to deploy.
Verizon knows Cox is a competitor, and has been for several years, according to Verizon spokesman Paul Miller. He said VoIP is one of many technologies Verizon is looking at to remain competitive. But he said the company is not yet ready to provide it to the mass market.
For the Roanoke trial, Cox is giving the service to about 100 company employees in the valley, who will help identify service problems. Although Amirshahi does not know how long the test will last, he said the Oklahoma City trial lasted six months.
Pacifico stressed the technology is not the same as transferring voice over the Internet. The signals are sent on a privately managed data network instead of the public Internet, which may include a delay in delivering the data.
"The term Internet telephony has negative connotations because the early providers utilized the public Internet, providing inferior quality voice service," Pacifico said.
A VoIP signal can be transmitted one of two ways. The signal can be digitized and converted into packets all the way to its destination. It can also be converted back to analog voice and transmitted through the public switch network to someone using a different server.
The process makes VoIP calls match the quality of those over normal phone service, Pacifico said.
Cox reaches more than 6 million homes nationally with its cable television service, still its core business. About 40 percent of them can order traditional circuit-switched phone service over Cox cables. VoIP capability would greatly increase that figure, the company said.
In the meantime, Cox will not deploy VoIP services until it can be provided at a lower cost and is ready for widespread deployment. Pacifico hopes Cox can run a market trial later this year, but is not disclosing the location. |
