Internet 2002, The Net: Not Just Data Anymore
zdnet.com
August 31, 1998
By Tom Steinert-Threlkeld
With packet networks becoming multimedia
highways, public communications stand to be
transformed in short order
Four years is not a lot of time. Of course, in August
1994, U.S. Vice President Al Gore was talking about an
information superhighway and many experts were
figuring that cable television networks would be its
foundation. The big news was that Prodigy Inc. was
going to provide access to its online content via the
World Wide Web. Monica Lewinsky was a total
unknown.
Way back then, there were only 3,000 Web sites in the
world, 3.2 million host computers and 30 million Internet
users. Now, there are 2.5 million sites, 36.7 million hosts
and 134 million users.
In that time, the use of Net technologies has removed all
doubt as to what basic communications protocols will be
used to tie together the rapidly increasing multitudes of
computer systems and networks around the world. The
Internet protocols now are the lingua franca of
interconnected computing. The only question that
remains: Will Internet Protocol (IP) become the lingua
franca of all electronic communications?
"The time has come. In fact, it's long overdue,'' says
Leonard Kleinrock, the University of California at Los
Angeles professor who, in 1961, published the first
paper on the notion of sending information in packets of
digital data. The U.S. Department of Defense's Arpanet,
which went on to become the Internet, came to life in
Kleinrock's UCLA laboratory in 1969.
Kleinrock's comment came shortly after Sprint Corp.
announced it was switching its entire local and
long-distance network to the kind of packet technology
that is behind the Internet. And while Kleinrock may be
evoking a bit of the pride of authorship, almost any large
communications company worth its cross-connects is
scrambling to convince investors that it is on track to
become a leader in Internet-based communications in
short order. How otherwise to dispel, for instance,
stockholder chagrin at the seemingly lackluster merger of
GTE Corp. with Bell Atlantic Corp.?
Make it clear that one of the driving forces behind the
$68 billion merger was the 1997 acquisition of BBN
Corp. for $600 million, which made GTE
Internetworking a leading player in the era of packet
communications.
In fact, as August 1998 draws to a close, the idea that, in
the next four years, the Net will have established itself as
the primary means of exchanging not just numerical data,
text and Web graphics, but also sounds, sights and voice
conversations themselves, is no longer some technology
wonk's spirit-induced "vision.'' That public
communications in the year 2002 will be synonymous
with the Internet, at this juncture, seems more realistic
than strained.
Multimedia Growth
Driven by growth of the Internet, data traffic is growing
10 times as fast as voice traffic. Indeed, WorldCom
Inc.'s UUnet Technologies Inc. subsidiary sees no
relenting in 1,000-percent-per-year growth in data traffic
on its network. This has led John Sidgmore, its chief
executive officer, to conclude that, in another six or
seven years, conventional voice traffic on traditional
telephone networks will account for a scant 1 percent of
all communications.
That kind of growth is possible not just because the
number of worldwide Internet users keeps escalating, but
because uses for the Net are becoming more complex.
In a word: multimedia. Video and audio files occupy
much more space on a packet network than do text and
numbers, the main constituents of today's electronic mail.
But five-minute movies soon may become routine
attachments to e-mail, each eating up tens of millions of
bytes of space.
"People need bandwidth and demand bandwidth and will
be willing to pay for bandwidth,'' says David Isenberg,
the AT&T researcher who authored "Rise of the Stupid
Network,'' a critique of telephone company efforts to
create so-called "intelligent'' networks.
"I don't see [the growth in data traffic] letting up,'' says
John Curran, chief technical officer at GTE
Internetworking . "I see it accelerating.''
While traditional telephone companies, such as Bell
Atlantic or SBC Communications Inc., seem to spend
most of their strategic capital on merging with other
traditional telephone companies, new clean-sheet
communications companies with tens of billions of dollars
in available funding are building high-capacity networks.
These networks will not set up and tear down exclusive
circuits to carry calls; instead, they will send all traffic as
packets of data, from voice to video, from spreadsheet
to text document. They will use IP as the basic form of
creating packets, even if some choose to convert IP
packets to fixed-size packets to take advantage of a
more proven packet-switching technology - such as
Asynchronous Transfer Mode (ATM) - in the interim for
moving data in public communications networks.
In what seems like a sudden strike to a series of local
and long-distance networks that have developed over
the last century to handle one type of data - voice - the
Internet now has become more than just a medium for
allowing easier, more graphical communication between
individuals and offices. It has become the driver for a sea
change in how communications networks themselves are
structured.
Just as the long-playing record and the 45 RPM single
were replaced by the compact disc, digital technology
now will replace analog sound wave technology
throughout telephone networks, not just on long-haul
lines. Digital technology promises greater efficiency and
lower cost.
Economics 101
In the end, the Internet - if it becomes the public Net -
will win on the basis of simple economics.
Sprint, for instance, figures it will save 70 percent over
circuit switching with its packet-switching Integrated
On-demand Network. This will allow it to radically
reduce its charges. Companies - ranging from IP
network gear giant Cisco Systems Inc. to Microsoft
Corp., with its CTO, Nathan Myhrvold - openly talk
about how, in the packet-switching era, voice com-
munications will be "free.'' The theory: The cost of
moving a bit will drop so low that companies can sell
packages of data services - that will include handling
voice calls - for less than what companies now pay for
their voice services alone.
Packet switching is more efficient than circuit switching,
because packets can be used to fill up all available
communications capacity; circuits remain open for the
duration of telephone calls, regardless of whether anyone
is speaking or if any data is being sent.
But it's not just a matter of sharing available capacity that
gives packet switching a commanding leg up over circuit
switching. There's the matter of the switches themselves.
With circuit switching, the pace of technological change
is impressive. So called "stored program switches" - such
as the Lucent Technologies Inc. 5ESS or the Northern
Telecom Inc. DMS - double their performance for the
same cost every 80 months, says Peter J. Sevcik, an
associate at Northeast Consulting Resources Inc.,
located in Boston. More advanced ATM switches
double performance in half that time.
IP routers, however, double performance every 20
months, and frame relay switches double every 10
months. When calculated in terms of the number of bits
per second per dollar that can be moved, packet
switches now beat circuit switches - and the gap will
widen.
Then, there's the software that runs routers and other
packet network switches. Programs that run
conventional circuit switches have been developed
largely in-house by telecom switch vendors, with input
from their service provider customers. But, in the age of
IP, the ability to write applications, utilities and other
programs for communications networks is wide open.
Anyone with a better idea can produce a product to
improve communications performance.
"IP brings thousands of entrepreneurs supported by
billions of dollars in the marketplace to bear on the
problems of communications. It breaks it down, breaks
communications down a piece at a time,'' says James
Crowe, CEO of Level 3 Communications Inc.
That should help packet-switched networking based on
the Internet protocols overcome its biggest technical
obstacle: the fact that circuit switching offers higher
quality and more reliable connections for time-sensitive
communications - particularly for voice calls. Telephone
companies know how to run systems that serve millions
of people and businesses simultaneously, with few
failures, says Bill O'Shea, data gear chief at Lucent.
"They know how to keep the system up,'' Kleinrock
says. "The data guys are just beginning to think of this
now.''
That's why many of the IP networks may actually, for a
few years, run on ATM switches. With ATM switches,
carriers not only can guarantee quality, reliability and
security, but they also can keep track of who is carrying
packets for whom and settle up bills later.
"There are a lot of things that we haven't comprehended
yet,'' Bell Communications Research Chairman Emeritus
George Heilmeier says about how to make packet
switching work as well as circuit switching.
Settlement procedures and quality assurance are still to
come in IP-only networking. A new version of the basic
Internet protocols will add mechanisms that can
guarantee higher levels of service for traffic that requires
it. In the interim, companies such as Level 3 are working,
with the current version of IP, on protocols that get
around the problems. Indeed, the quality of a
long-distance call on Qwest Communications
International Inc.'s long-distance packet network is so
high that Baby Bells such as Ameritech Corp. are trying
to resell it.
In the face of this shift from circuit economics to silicon
economics, there may be method in the Bell telephone
companies' urge to merge their local telephone assets,
after all. As this era of end-to-end packet networks
emerges, the one choke point remains the last mile. For
more than a decade, long-distance networks have been
digital, sending data along glass fibers as pulses of light.
But local networks still rely on sound waves to get to
homes and offices on the tips of their copper lines. As
long as copper remains the first and last connection to
the Net, local phone companies will control access to
customers and will be hard to bypass, even in the packet
era.
At present, competing local phone companies have
largely focused on picking off high-margin
communications in metropolitan areas where there are
high concentrations of corporate customers. Then, it is
economically feasible to lay down fiber to reach them or,
in some cases, provide "wireless fiber,'' as WinStar
Communications Inc. does in New York and other
major markets.
Planning For The Future
Local phone companies don't plan to stand still,
however, as wired and wireless alternatives pick off
prime customers.
SBC, for instance, says it is planning for its local
networks to be based on IP packets with an ATM
switching "fabric'' by the year 2002. In addition, it plans
to focus on providing data services to businesses
between now and then. It has spent $3 billion in the past
four years getting ready and will spend another $150
million to $200 million per year over the next three years.
Still, a circuit-switching company such as SBC will be
hard-pressed to abandon services it provides on
networks that, because of depreciation schedules driven
by monopoly regulation, are not yet all paid for. Besides,
they can command premium prices with these services.
Currently, a T1 high-speed connection - which can
transmit data at 1.5 megabits per second - can cost a
business $300 or $400 per month or more.
"Will there be a pell-mell rush for IP in the local net by
SBC? Probably not," says Probe Research Chief
Operating Officer Allan Tumolillo.
SBC Executive Vice President for Corporate Planning
Michael Turner says that 98 percent of the company's
revenue today comes from circuit-switched voice
communications, and he figures that even when data
becomes more than half of his company's traffic, it still
will account for less than half its revenue.
The revenue disparity could slow down carriers in
deploying high-speed digital access technologies. Why
provide 1.5-Mbps access through Asymmetric Digital
Subscriber Line technology at $90 per month if
businesses start dropping T1 lines they'd been paying
three or four times as much for?
Or, why push virtual private networks if the end result is
that customers must abandon better-paying dedicated
circuits for cheaper IP-based temporary circuits? Only
the threat of losing the customer's business altogether.
Indeed, as the year 2002 draws near, the idea of
end-to-end packet networks that don't involve local
phone companies at all will be imminent, if not already in
place. Level 3 and Qwest, both based in Denver, plan to
have complete local and long-distance, packet-based
networks in operation nationwide over the next three
years. These networks can be higher-quality than the
public Internet because they are under one company's
control. And because they use Internet technologies, they
can communicate easily with the public Internet.
And they may be ideally situated as well, in the effort to
find ways to bypass incumbent phone companies' local
phone networks. Denver just happens to be where the
cable television industry is based, providing easy,
face-to-face communications with the companies that
have the highest-capacity local communications networks
already in place.
Adding momentum to the move to packets will be an
answer to the last-mile quandary that actually involves
sending local calls nearly 1,000 miles into the sky and
back down again. Close to launch is the
Internet-in-the-Sky network of Bill Gates and cellular
pioneer Craig McCaw. And while Teledesic LLC
supposedly is targeting rural customers unserved by
competing metropolitan carriers, many communications
experts expect the company's business plans to avoid
offering universal service for all kinds of packet
communications, including voice.
"That makes the magic date 2002. That's when the
wireless alternatives enter the fray,'' says Larry Vanston,
president of Technology Futures Inc., an Austin,
Texas-based forecasting and consulting company.
But by that supposedly magic date, if packet switching is
indeed going to supplant circuit switching and the Internet
is to be its embodiment, the technology must learn to
deal with hundreds of millions of long-distance phone
calls and billions of local phone calls every day. Plus, it
will have to move streams of audio, video and other
types of data at speeds that will tax routers moving
trillions of bits of information per second.
The idea that the Internet in the year 2002 will be the
successor to today's public communications network is
no slam dunk. "The Internet hasn't really dealt with that
kind of thing, yet,'' Tumolillo says.
But, if usage keeps accelerating, it will have to learn fast.
Sprint Corp. can be reached at www. sprint.com
GTE Internetworking can be reached at www.bbn.com
Lucent can be reached at www.lucent.com
Level 3 can be reached at www.level3.com
SBC can be reached at www.sbc.com
Qwest can be reached at www.qwest.net
Related Stories:
The Efficiency Of
Packets
The Bell Data
Network
Internet 2002:
Table Of Contents
Circuit Switching
Vs. Packet
Switching
Laying "Dark
Conduit"
See Me, Hear Me
In For The Long
Haul
Qwest For The
Top
Building
Appetites
Beam Me Up,
Craig
O2: Net Lifeline
Highly Charged
Others To Watch
For
Gearing Up
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