From the Financial Times:
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THURSDAY JULY 30 1998 Telecoms
BT to stick by Viag as operator
By Alan Cane in London
British Telecommunications
German distribution of the services of the new joint venture between British Telecommunications and AT&T of the US is to be undertaken by Viag Interkom, BT's partner.
Viag will take the lead in Europe's biggest telecoms market rather than Mannesmann Arcor, a new German operator in which AT&T holds a minority stake.
Sir Peter Bonfield, BT chief executive, said yesterday it would be up to AT&T to decide the future of its interest in Mannesman Arcor.
BT has a 37.5 per cent stake in Viag Interkom.
It is investing heavily in the company as it builds a new network to challenge for a share in Germany's telecoms market. BT's share of the company's losses came to œ44m in the quarter to June 30 this year.
Resolving the German dilemma is only one of a series of problems for BT and AT&T as they disentangle existing partnerships and alliances to clear the way for the new venture.
The two partners, however, do not expect problems with regulators over their share of transatlantic telecoms traffic. It is currently about 20 per cent of the total and declining as new, high-capacity undersea cables are laid to cope with internet traffic.
Announcing BT's first quarter results, Sir Peter said both companies planned discussions with a number of potential partners.
These include Kokusai Denshin Denwa, the largest Japanese international carrier, which is a founding member of the AT&T alliance WorldPartners.
AT&T must quit both WorldPartners and the European alliance AT&T-Unisource under the terms of the deal.
KDD has already indicated an interest in joining forces with BT and AT&T.
BT's share price rose 10p to close at 895p after Sir Peter announced first quarter results ahead of market expectations. Turnover, including BT's share of its associates and joint ventures, rose by 10.3 per cent to œ4.24bn.
Operating profit, however, was only 0.8 per cent ahead at œ898m and profits before taxation fell 17.9 per cent to œ723m against œ881m last time.
Analysts, however, had expected only œ710m at best.
Earnings per share were 7.6p compared with 9.4p.
The losses incurred as BT develops its ambitious European expansion programme and higher interest costs following the special dividend paid to shareholders last September, associated with the aborted merger with MCI of the US, accounted for the earnings decline.
Residential line connections were virtually constant at 20.1m despite inroads made by cable television operators.
Sir Peter said that 8,000 second lines were being installed each week and 8,000 customers who had moved to cable operators returned to the BT fold each week.
Meanwhile, inland call turnover grew by 1.3 per cent to œ1,250m.
kdd.com
Background on today's Korea Telecom announcement:
mainstreetxpress.com
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Korea Telecom Selects Siemens / Newbridge ATM Solution
World's eighth-largest public service provider installs world's largest commercial Asynchronous Transfer Mode (ATM) switched virtual circuit service network
KANATA, Ontario, January 23, 1997 -- Korea Telecom (KT), the national telecommunications service provider of Korea and the eighth largest telecommunications company in the world, has selected the Siemens / Newbridge Alliance, through Samsung Electronics, to supply the MainStreetXpress 36170 Multiservices Switch and MainStreetXpress 46020 Network Management System for its national Asynchronous Transfer Mode (ATM) network.
The Korea Telecom network will be implemented in three phases, the first of which will provide numerous applications over switched virtual circuits (SVCs) to 300 customers in the central region of Seoul, the economic and political capital of Korea. This is the largest commercial deployment of SVCs in the world. In the next phases, the network will expand the services throughout Korea gradually and will provide more value-added application services. The KT network will provide Internet access, videoconferencing, video-on-demand, distance learning, telemedicine and information retrieval applications. It is the world's first commercial deployment of the full complement of these services.
"The KT network delivers SVC-based services over T1/E1 cell relay ATM and serves as a showcase for ATM technology," said Peter Charbonneau, President and Chief Operating Officer, Newbridge Networks. "This is one of the largest projects of its kind and we are very pleased that Korea Telecom has selected the Siemens / Newbridge Alliance as its supplier.
This once again underscores our position as the industry's number one ATM technology provider and positions us well to participate in the exponential growth of ATM expected in Korea."
"Samsung is pleased to partner with Siemens and Newbridge to deliver this exciting solution to Korea Telecom," said Joong Soo Park, Managing Director of Korea Telecom. "We have integrated our applications and the Alliance switching and management to deliver this unique network.
"Korea Telecom selected the MainStreetXpress 36170 Multiservices Switch over the complete universe of competitive ATM equipment supplier offerings because of its leadership position as a universal services platform for ATM-based services."
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newbridge.com
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Fiber City Lights Way for Korea Telecom
As Korea prepares itself to open up to telecom deregulation in 1998, the nation's incumbent carrier has sought to separate itself from an approaching pack of competitors.
Korea Telecom has bullishly shaped itself as a world leader in the telecom evolution and in the provision of advanced services based on ATM (asynchronous transfer mode) technology.
<Picture: Figure 2>
In Korea, residential clients are seeking better and more varied telecom services at affordable price points. Education, for example, is a prime driver in Korean society; parents and educational institutions are continuously looking for ways to better their education system and differentiate their graduates. Thus, they look toward organizations like Korea Telecom to offer value-added services that provide students with a more competitive, technological edge.
Businesses are also insistent that their carrier help them operate more efficiently both inside and outside the enterprise, and that includes easy and affordable access to the Internet, intranet and extranet services, video applications, and improved voice services.
In the early 1990s, the carrier began formulating a plan for what is now KT Fiber City -- an inspiring high tech-equipped island that sits in the middle of the Han Gang river, at the heart of the nation's capital, Seoul. KT Fiber City is the world's first commercial deployment of a broad range of advanced high speed services.
The Process
In 1994, KT called for proposals from a number of Korean-led consortia. These were narrowed down to three contenders, from which KT selected its compatriot supplier, Samsung Electronics, as its main systems integrator for the project. Samsung's bid is complemented by the broadband, ATM-based product family, service, and support from Siemens AG and Newbridge Networks Corporation.
The world's eighth largest carrier, Korea Telecom plans to build a public backbone for multimedia services based on ATM technology. While the eventual goal is to build a nationwide, 200-city, multimedia network for education, entertainment, and business purposes, Fiber City is the trial site.
The Fiber City Network
KT divided the beta test network up into three different sites, all on the island and all connected over STM-1 lines.
The backbone switching is located at the Yoido Operations Center. The back- bone consists of three MainStreetXpress 36170 Multiservices Switches and the MainStreetXpress 46020 Network Manager, which provides network-wide management. Data Collector and KeyBill, from Newbridge Affiliate CrossKeys, are used to provide permanent and switched virtual circuit (PVC and SVC) billing services.
Three video-on-demand servers are run off the Operations site, as are the electronic news, library, and museum servers, the distance learning center, the routers which provide the gateway to the Internet, and eventually, the telemedicine server. The ATM address resolution protocol (ARP) server, which provides a transparent directory of the full network and simplifies the management of network addressing, is also installed at Yoido.
An additional 36170 system is installed in the basement of Miju, an apartment building complex housing affluent, well-educated residents. Korea Telecom has outfitted residents of Miju with full multimedia-capable PCs and software -- equipment that costs about $10,000 per machine but which is a vital component of the multimedia service.
In addition, a 36170 system is installed at the Multimedia Interactive Center (MMIC), a demo center for public access to the KT network.
The approximately 300 users include corporations, residents of the Miju apartment complex, government staff, Korea Telecom employees, and information providers including an English professor.
<Picture: Cartoon>
SVCs Implemented First at Fiber City
Korea Telecom is deploying its broadband infrastructure in three phases. Phase I provided numerous applications over SVCs to 300 customers. KT was the world's first user of ATM SVCs -- a true indicator of the carrier's aggressive drive. The ability to dynamically allocate bandwidth, which the now-common SVC service provided, is a necessary component of Fiber City's selection-dependent multimedia offerings.
ATM is the only technology that can guarantee class of service (CoS), making it the only technology that KT could have chosen to deliver its services over PVC and SVC connections. At the outset of Fiber City's launch, KT had close to 11,000 PVCs established; there are now only 3,000 and remaining connections are made via the dynamic functionality of the SVC service.
Phase II, which is now underway, includes the introduction of new applications, and the addition of E1, which increases capacity to 2.048 Mbit/s.
Network Architecture
Korea Telecom is building its broadband network using the MainStreetXpress 36170 at the core and edge of the network, Cisco routers for access and the MainStreetXpress 46020 for network management.
"Korea Telecom selected the MainStreetXpress 36170 Multiservices Switch over the complete universe of competitive ATM equipment supplier offerings because of its leadership position as a universal services platform for ATM-based services," said Jong-Soo Park, who was a Managing Director of Korea Telecom at the equipment selection time and is now a vice president of KT International.
The MainStreetXpress 36170 switches are loaded with STM-1, DS3, T1 ATM and E1 ATM cards. A highly scalable switch, the 36170 allows the network to grow as more and more users come on board, which is ideal for the current KT requirements both at the edge and the core.
The variety of interfaces that the MainStreetXpress 36170 offers allows Korea Telecom the flexibility to provide a wide range of services. Further, the switch is able to interoperate effectively with the Cisco router.
Seamless end-to-end management is offered by the unmatched capability of the MainStreetXpress 46020. The MainStreetXpress offering is cost-effective because it allows Korea Telecom to consolidate multiple services off the same infrastructure, as well as provide a future-proof solution.
"The MainStreetXpress 36170 is incredibly robust, making it a powerful and dependable solution," said Newbridge Managing Director for the Asia-Pacific Region, Ken Park. "Korea Telecom can rest assured that services off its broadband network will be stable, and customer satisfaction will remain intact."
<Picture: KT Fiber City Network>
KT Fiber City Applications
Distance Learning and Interactive Distance Learning
A prominent English teacher is able to tape English lessons every day, via a source camera located in his office. The lessons, which are geared toward varying levels of English ability, are broadcast live several times during the day, using point-to-multipoint connections on the MainStreetXpress 36170 switches. Other English lessons are archived for video-on-demand purposes.
Video Phone
Fiber City participants are able to call each other, via SVCs, over a "video phone." Once the receiving end accepts the call, the video camera displays the callers to each other, much like a videoconference. A directory is also regularly updated so that users can determine with whom they can utilize this service.
Videoconferencing
This service is just being launched as part of Phase II, and will enable multiple users in the trial network to videoconference.
Video-On-Demand
A selection of exercise videos, movies, and documentaries are stored on a server, which the user can access to select materials. The user is able to perform standard video functions, such as stop, fast-forward and rewind.
Electronic News
Daily updates to the electronic news server make it a reliable source for current affairs -- which can be accessed easily from a personal computer.
Korean Culture
Via the T1 ATM network interface card, users are able to browse through museum and library Web pages which pertain directly to Korean culture, history and geography.
Internet Access
Trial participants now have access to the Internet at rates of 1.544 Mbit/s.
Proposed Phase III Offerings
Proposed future applications include home shopping and telemedicine, which would provide for remote and mobile medical services such as x-ray abilities in an ambulance.
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mainstreetxpress.com
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Korea Telecom Selects Siemens/Newbridge ATM Solution
Korea Telecom (KT), the national telecommunications service provider of Korea and the eighth largest telecommunications company in the world, has selected the Siemens/ Newbridge Alliance, through Samsung Electronics, to supply the MainStreetXpress 36170 Multiservices Switch and MainStreetXpress 46020 Network Management System for its national ATM network.
The Korea Telecom network will be implemented in three phases, the first of which will provide numerous applications over Switched Virtual Circuits (SVCs) to 300 customers in the central region of Seoul, the economic and political capital of Korea. This is the largest commercial deployment of SVCs in the world. The second phase is scheduled to provide service to all of Seoul in mid-1997, while the third phase will extend the service nationwide by the end of 1997. The KT network will provide Internet access, videoconferencing, video-on-demand, distance learning, telemedicine and information retrieval applications. It is the world's first commercial deployment of the full complement of these services.
"Samsung is pleased to partner with Siemens and Newbridge to deliver this exciting solution to Korea Telecom," said Jong Soo Park, Managing Director, Samsung Electronics. "We have integrated our applications and the Alliance switching and management to deliver this unique network. Korea Telecom selected the MainStreetXpress 36170 Multiservices Switch over the complete universe of competitive ATM equipment supplier offerings because of its leadership position as a universal services platform for ATM-based services."
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Building advanced managed IP networks:
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