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Technology Stocks : Voice-on-the-net (VON), VoIP, Internet (IP) Telephony -- Ignore unavailable to you. Want to Upgrade?

To: elk who wrote (549)	5/16/1998 1:05:00 PM
From: Frank A. Coluccio	Read Replies (2) \| Respond to of 3178

Evan, >>who wants to really bother filing all those FCC petitions?<< Indeed, although many of the startups have taken up ISP status <<cough!!> and don't bother with such formalities. The answers to your questions would read like nothing short of a business plan, and would by no means represent a trivial set of issues, if done "correctly." Whatever that might be. I find that the Internet and its stock boards like this one have inspired a participatory spirit in investors in some industries more than others. The closer to the Internet that a startup might be involved with, the more the investor needs to know about it and how it will operate, be constructed, etc. One would not think that investors in a power generation company, say, would ask how to set up the phase angle regulators and high tension systems (to keep the metaphor relevant) etc., yet we hear questions concerning VoIP as though it only requires an erector set mentality or something that could be found in a do-it-yourself handbook. In some cases, based on some of the startups I've seen and met with, perhaps this is an accurate depiction. And the key to their hopes for success may lie in simplicity, and the knowledge that a subscriber will actually endure degraded voice quality (although it is getting better) and having to dial 30 some odd digits in order to save from 2.x to 3.9 cpm domestically (while this spread lasts, in any case). International is still a different domain, but that too will narrow over time, fostered by even those players who are using low-bit-rate TDM and ATM, where they own the glass to get from here to there. Big difference [a world of difference] when you own the glass or do an IRU. But no doubt about it, dollar investments in foreign implementations will go much farther and create far better margins and returns, to be sure. But International is not a cake walk, and takes a great deal of political doing and know-how, along with an iron stomach in many instances, in comparison to racking and stacking domestic gateways in colos like so many ducks in a shooting gallery. The parameters involved in any infrastructure buildout depend on decisions that dictate quality. Best practices and world class techniques are crucial to ensure leg-0 -like interoperability with others in the same sphere, extensibility of the fruits of investment decisions, and migration capabilities, since things are very temporary these days. Today's chosen solution is sure to be next year's (literally) backwards compatibility problem. Costs per port for analog-to-IP conversion may be in the range of $400 to $1000 today, but this will plummet to the costs of 10BaseT cards over time, or under $40. And as desktop bus speeds and internal clock rates increase aided by dedicated processors for M-M, the latency problems found in the much maligned PC voice variant of VoIP processing will vanish, and this primary driver for the gateway's dedicated processing boards will be tossed aside, where many low traffic volumes are concerned. Add to this the impact of routers and RACs that support VoIP as part of the corporate or even SOHO intranet infrastructure, and we begin to see a much different story unfold going into tomorrow than we envisioned only a year ago, when the gateway was all she wrote. Didn't mean for this to sound like an indictment against gateways in general, only to certain (albeit a growing number of) niches where they are useful today, but where they may be redundant or even obstructive tomorrow. I'm sure I didn't answer your questions, but in some ways the premises of those questions resembles "how does a surgeon perform an operation?" It's not a trivial set of responses that I can offer you, in either case, but in each case the answer is "it all depends on what ails you." Later, Frank C.