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To: Kenneth E. Phillipps who wrote (1785)	8/3/1998 2:40:00 PM
From: Kenneth E. Phillipps	Read Replies (1) \| Respond to of 12823

Article from Business Wire confirms what we already knew - ILECs have given up on broadband/fiber-to-the-curb. Business Wire - August 03, 1998 08:25 SAN FRANCISCO--(BUSINESS WIRE)--Aug. 3, 1998--Shipments of telephone network access equipment will soar from 1997 market sales of $2 billion to $4.2 billion in 2001, according to a new report issued by ryan hankin kent, inc. The report, "Loop Access Systems: Technology and Markets," predicts that growth in demand for access equipment will initially be driven by deployments of narrowband systems, with mass deployment of broadband xDSL systems beginning in 2000. The report identifies xDSL, particularly ADSL, as the industry's next-generation technology for data and Internet access. Driven by explosive growth of Internet access subscribers and competitive deployment of cable modems, ADSL has progressed through trials in 1997 with xDSL deployment projected to reach 49,000 lines by the end of 1998. The UAWG (Universal ADSL Working Group) initiative to develop a splitterless ADSL specification will slow ADSL deployment in 1998 but accelerate it in 1999 and beyond. According to Claude Romans, senior analyst, "Because xDSL can provide a delivery platform for high-speed data, as well as future video services, we expect deployment to pick up significantly as more products become available in the market and standards are finally stable." In the "bottom's up" approach that forms the basis of the forecast RHK analysts evaluated each carrier's system architecture and rate of deployment for loop access systems. RHK forecasts that the total access systems market will grow at a 16 percent annual rate. Most of this expansion will be generated by increasing demand for narrowband access technologies due to continued new subscriber growth, second line growth, and deployments of new services. The report documents a varied pattern of growth among the access systems deployed by ILECs. "Because of cost of field-performance issues of current systems, ILEC deployment of broadband/fiber-to-the-curb activity is winding down or has completely stopped with fiber-to-the-curb systems being deployed as narrowband only, broadband ready systems," observed Steve Korzyniowski, senior analyst. He added, "Trial activity has shifted to non-fiber broadband alternatives, such as xDSL." ryan hankin kent, inc. is a market research firm that specializes in analysis of advanced communications technologies and services that affect the PSTN, cable TV and external data/IP networks. The company has achieved a reputation for detail and accuracy in the telecommunications industry. The "Loop Access Systems: Technology and Markets" report is one of the volumes comprising RHK's STAR (Systems for Telecommunications: Analysis and Research) continuous information service; a forecast of markets and technologies affecting the future of telecommunications in North America's public networks. RHK is based in South San Francisco, California. For more information, visit the company's website at: HYPERLINK rhk.com or contact Mike Mahan at 650/737-9600, fax 650/737-9766. Note to Editors: A graphic reflecting access market trends is available for publication. Please contact Catherine Cook, email: catherine_cook@rhk.com, voice: (+1) 650/737-9600. CONTACT: ryan hankin kent, inc. Mike Mahan / Jim Kent, 650/737-9600 Headlines Previous Story Next Story %RYAN-HANKIN-KENT %CALIFORNIA %COMPUTERS %ELECTRONICS %COMED %TELECOMMUNICATIONS V%BW P%BW

To: Kenneth E. Phillipps who wrote (1785)	8/3/1998 3:19:00 PM
From: Frank A. Coluccio	Respond to of 12823

Ken, I was beginning to think that the author was missing the point, until I came across the last paragraph: >Critics worry that Bells would lose the incentive to open local markets and eventually could shift voice calls to the data networks.< And therein lies the foolishness, or should I say, the "lag," in regulatory timing and relevance, IMO. Of course! If the Bells are allowed to create data overlays using IP protocols, then they would be free to begin offering long distance voice services, as well. There's the absurdity of the divided set of FCC rules as they are defined today. Or, should I say, as they are evolving today? If you make VoIP legal and proper for one, then you must judge it the same for the other. The recent dealings of Qwest/ USWest/ Ameritech have already demonstrated that the BOCs would not be shy about leveraging even an inferior grade of service (which VoIP still is, at this time, although it is improving in those dedicated backbone nets) in order to gain access to the long distance market place. I've read several accounts in the recent past which have suggested that the FCC and some of the PUCs would be friendly to the BOCs entering internet access, but not data services. This is the other shift that is late in making an impression on the regulators. I.e., they are still regarding the Internet as something other than data services. With convergence taking place, the internet will encompass all forms of electronic information transfer. How many firms need to bring their entire businesses over to VPNs, and extranets, and other forms of modified e-commerce on the 'net, before the Internet is considered a data service? And it is also a voice service. And it will be a video service with time. Could it be something so simple as the fact that the glossaries in the commerce department and the FCC need to be updated? <g> Regards, Frank C.