Larry, Here's my understanding of the problem. Phone calls are routed through a switch at the RBOCs CO. One switch for each call. The number of switches that the RBOCs have is based on statistical studies of calling patterns, average connection times, expected population growth, etc. People connecting to the Internet are using a switch for hours and hours and this is tying them up longer than planned. Therefore, there is growing concern that a switch won't be available when you place a call and you will get a fast busy. This happens a lot at my office by the way because there aren't enough switches out of the building.
Contrary to what I have read in this thread, competition for local service is heating up. Not only are long distance companies gearing up to provide local service, but there are many start-up companies and cable companies that are planning to offer local service in the near future. The entire telecommunications industry is being deregulated and this will produce competion for RBOCs. To me this means that they will not be able to charge by the minute as has been suggested in this thread. Competion will preclude this. If they are doing this now, it won't be for long IMO. I live in Texas and my local carrier is SW Bell (SBC). For many years, SBC has offered two payment plans, one unlimited calls for about $24 per month and another plan that costs about $8 per month + a fixed rate per call. But they haven't yet eliminated the unlimited service for 24 bucks.
Now, a possible solution to this problem. DSC Communciations (DIGI) has been in the news recently promoting their new product called an Internet Cutter. This product can be integrated into another DSC product called Litespan, which is widely used by many of the RBOCs. The product contains software that is smart enough to detect that one is connecting to the Internet and it bypasses the switch at the CO. I'm not a telco equipment expert, so I don't really understand how this works, but DSC said it works, they have a large installed base of Litespan products, and I think they will be able to sell a ton of these products. Somebody in the DIGI thread said it best. "The first time somebody can't place a 900 emergency call and can't get through, the PUC will be all over the RBOCs to do something about this problem". Can you imagine the liability the RBOCs have? They aren't going to wait for this to become a problem; they will be proactive and solve it before somebody dies because they couldn't get through to 911.
If you want more detailed information on DSC's product, I suggest you call their investor's relations department. I've called them before and the gentleman that heads up the department, Mike Haase, is very cordial and helpful. You might also want to click on "Profile" in SI, pull up DIGI, and check the news today. There's a story from DSC on their Internet Cutter product. Additionally, a DSC VP was on CNBC this afternoon discussing the product.
Dan |
