Something to think about by reading the following articles from Financial Times U.K.
Bill Schrader: Servicing demanding companies
By Paul Taylor
PSINet may not be a familiar household or boardroom name in Britain yet,
but the US-based corporate Internet service provider (ISP) is determined
that will change.
The group, which prides itself on innovation and technical excellence, has
built a "gold-plated" network, designed to provide its mainly corporate
customers with a speedy, robust and reliable service. It launched the first
national commercial ISP in the US and now has about 35 per cent of the
market. Outside the US, the group has expanded its network to other
countries including Japan, South Korea, Canada, Holland and the UK.
In Britain, PSINet commissioned a new British network in February and
launched its range of corporate services in May. This enabled PSINet to
take on more than 1,000 corporate customers it had acquired in the UK
through its 1995 purchase of EUnet GB.
Its packet-switched TCP/IP network, which is based on advanced
high-speed ATM (Asynchronous Transfer Mode) and Frame Relay
technologies, is the largest of its kind in the world.
"PSINet brings professional business standards to the global delivery of
Internet products and services," claims
Bill Schrader, PSI's president and chief executive who co-founded the
company in 1989 with Martin Schoffstall.
Schrader and Schoffstall's previous achievements included writing SNMP
- the Simple Network Management Protocol - which has since become a
worldwide networking standard owned and licensed by PSINet.
Despite this technical background, Schrader is passionate about business
on the Internet. "Electronic commerce is the future of the Internet," he says.
But he also believes that business customers - who comprise 80 per cent
of PSINet's client base - require a different type of service from an ISP.
"Businesses want reliability, security and simplicity, and they want us to
take care of everything," he says. In order to serve its target corporate
market, PSINet has designed its network and its services from a different
perspective. Most other Internet service providers are router-based -
meaning that customer traffic faces many short hops along its journey.
These ISPs begin by leasing a dedicated data circuit, putting a router at
each end and then adding new circuits and routers as they are required.
The result, claims PSINet, is an asymmetric network topology which
makes routing more difficult to manage, makes redundancy difficult and
provides multiple vulnerable points of failure. This unbalanced structure
impairs throughput speed, increases costs and uses bandwidth inefficiently.
In contrast PSINet has built an integrated logical network around switches
and high-performance routers designed to optimise bandwidth while
minimising hops and congestion. This has enabled PSINet to offer all its
customers a range of sophisticated corporate services. These include
high-bandwidth managed Internet access, private virtual networks, remote
access services which provide portable Internet access for mobile
employees and Web hosting services.
Schrader argues that to provide the fastest possible and most reliable
access to corporate Web sites, they should be hosted on servers right at
the core of the network backbone itself.
PSINet, which launched its PSIWeb Web hosting service in Britain in July,
takes care of all aspects of manning the site, 24-hours a day while the
customer controls content, costs and updates.
Among the advantages of Web hosting, PSINet claims it eliminates
security concerns, additional staffing and capital investment costs and
provides Web site visitors with reliable first-time access and the ability to
download pages quickly, thereby encouraging more return hits.
Schrader also has strong views on the future of the Internet industry and
predicts a wave of consolidation among the thousands of ISPs in the US
and elsewhere. Within three years he predicts the industry will be
dominated by a handful of global suppliers and small niche companies.
He believes the five global Internet survivors will be the Sprint/France
Telecom/Deutsche Telecom consortium, AT&T Unisource, BT/MCI's
Concert unit, the merged Worldcom/MFS/UUNet Pipex group and, of
course, PSINet. "I don't think there will be room for any other players and
it is too late for new entrants," he says.
He also reckons that the traditional voice telephony network operators will
face an increasingly tough time, and not just because of Internet telephony,
which he believes will remain a niche product used by college students and
expatriates for calling home.
A more potent threat over the next five years, he believes, will come as
existing data applications, such as cheque-clearing services and fax traffic,
move off the circuit-switched networks operated by telephone companies,
and on to the lower-cost and more efficient packet-switched networks
operated by PSINet and the new breed of global networking companies. |
