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

To: Frank A. Coluccio who wrote (1375)	9/25/1998 9:41:00 AM
From: Frank A. Coluccio	Respond to of 3178

When Talk Is Cheaper [re: the Negroponte Switch] [some interesting discussion including wireless techs, pricing structures and a hint towards VoIP] September 25, 1998 Inter@ctive Week via NewsEdge Corporation : It's known as the Negroponte Switch -- the widely quoted prediction by Massachusetts Institute of Technology Media Lab guru Nicholas Negroponte that wireline (i.e., voice) and wireless (i.e., the broadcast media) communications would trade places. Right now, that switch is stuck somewhere between off and on. More than two-thirds of the country gets its television signals via a cable network. But wireless telephony, while continuing to increase its number of subscribers, has yet to make much of a dent in time spent on a wired telephone. "Wireless minutes of use are only about 2 [percent] to 3 percent of total voice minutes of use," says Herschel Shosteck, a longtime wireless industry analyst who runs Herschel Shosteck Associates Ltd. Until subscribers start treating their wireless phones as first choice rather than last resort for voice service, the Negroponte Switch will stay where it is. But Shosteck and others see signs that a usage shift is starting to occur abroad and suggest things could soon change in the U.S. as well. The reason: As the cost of using wireless networks drops, not only will more customers sign up for wireless service, but they also will begin thinking of their wireless phones as their primary means of communication. "What people want is a single phone," says Peter Bernstein, president of Infonautics Consulting Inc. "At a certain price level, my wireless phone becomes my only phone. I don't use pay phones or hotel phones or a wired phone in my house." Eventually, business travelers will rely on wireless access for their data connections, although industry experts concede there are greater barriers to mobile data today than to mobile voice (see "Wireless Data Still Frozen In Time," page I-17). Wireless Stumbling Block One factor that's held back the progress of wireless service in the U.S. is the nation's wireline infrastructure. Copper local loops may be giving U.S. providers fits as they try to roll out high-speed services, but few nations can match the ubiquity of the U.S. infrastructure, which reaches almost any customer that wants service. That reach means providers haven't been quick to deploy fixed wireless technologies, which use wireless networks solely to connect home and office phones to the public network. "We do fixed wireless systems overseas because there are no wires," says Jim Mullen, vice president at Hughes Network Systems Inc. (www.hns.com), a wireless equipment provider. "But here in the U.S., there is no incentive to use wireless technology for fixed services." The only major U.S. service provider making use of fixed wireless networks for residential voice traffic is U S West Inc. (www.uswest.com), which uses the technology in rural areas where the cost of building and maintaining a wired network is much higher. In general, the Europeans are two to three years ahead of the U.S. in wireless network construction and usage, Shosteck says. "Already, they are seeing wireless communications displace wireline services," he says. "In Finland last year, the number of minutes of use for wireline networks dropped slightly, and, for the first time, wireless revenues outstripped those of wireline services." In other markets, such as Israel, new wireless service providers are targeting the phone company, rather than one another, as their prime competitor, Shosteck says. U.S. wireless providers at least are starting to bring their prices closer to the wireline benchmark. Both AT&T Wireless Services Inc. (www.attws.com) and Sprint PCS (www.sprintpcs.com) have created service "buckets" that offer a large number of minutes at progressively lower per-minute rates. AT&T Digital One Rate, announced in May, offers three monthly calling plans: $89.99 for 600 minutes, $119.99 for 1,000 minutes and $149.99 for 1,400 minutes. The prices include all long-distance and roaming charges, although AT &T Wireless charges 25 cents per minute for calls that exceed each plan's limit. Sprint PCS offers a similar plan, although the caller must use Sprint's long-distance network to get those services bundled in. This kind of packaging encourages high-volume wireless users to rely completely on a wireless phone, Bernstein says. The next step will be to extend similar pricing to lower-volume users. " This is particularly true for younger people coming up today," says Keith Shank, director of strategic marketing and business development for the wireless communications unit at Ericsson Inc. (www.ericsson.com). "They will begin adopting wireless as their primary form of communications. Of course, people who lead a more mobile lifestyle are also drawn to this." There are early indications that this is beginning to happen in the U.S. BellSouth Mobility Inc. now claims that 15 percent of its customers in Louisiana don't have a wireline phone at all, and they rely completely on wireless service. "We have seen and our measurements have shown that minutes of use are rising per user," Shosteck says. That reverses a three-year trend that saw subscriber ranks rise and usage drop, as more wireless customers purchased phones for safety reasons and scrimped on usage to avoid high airtime charges. According to Shosteck, minutes of use per wireless customer reached 100 per month in 1994, but dropped to 96 minutes per month in 1995 and 90 minutes per month in 1996. "In 1997, minutes of use went back up to 96," Shosteck says. "All of that took place in the latter half of the year, as PCS [personal communications services] carriers came online en masse with lower-cost service bundles that the other wireless carriers had to match." Costs Are Coming Down As the costs continue to fall, it simply becomes more convenient for people to use their wireless phones, says Larry Brittain, North American regional vice president at Qualcomm Inc. (www.qualcomm.com), a wireless equipment maker. "It finally gets to the point where if I want to make a call, it's easier to use the phone in my pocket than get up from the couch and pick up the wired phone," he says. Part of that usage change stems from the fact that wireless phones are getting smaller and cheaper, Infonautics' Bernstein says. Motorola Inc. (www.mot.com) is billing its new, lightweight StarTAC as the first wearable phone. Another approach to convincing customers to use wireless phones as their primary means of communication is to offer lower prices or flat-rate billing for calls made from inside the home or office. Ericsson, Hughes and Northern Telecom Inc. (www.nortel.com) have developed fixed mobile wireless products, which operate in hybrid modes within office buildings or other commercial establishments. Inside the building, a wireless handset behaves like a cordless phone, and no airtime charges are incurred. Outside the facility, the phone becomes a mobile phone and airtime charges apply. Calls can even be billed to the individual using the phone, not the company that set up the wireless system at work. A similar approach can be taken for residential subscribers, once low-cost residential base stations are developed. Along with lowering charges for nonmobile calls, providers need to come up with a way to charge incoming wireless calls to the callers rather than the wireless subscribers. Today, wireless subscribers pay the airtime charges for incoming calls -- as a result, most calls placed over wireless networks are outgoing. "People don't use their wireless phone as their primary phone if they are afraid to give out their phone numbers," Bernstein says. Low-cost service isn't the only driver to a wireless voice world. There are increasing incentives for users who need to stay connected. One such incentive is universal messaging, or the ability to deliver e-mail and fax-mail over a wireless handset, either using the Short Messaging Service option built into digital wireless services or new appliances with built-in wireless access, such as the Palm Pilot from 3Com Corp. (www.3com.com). "Intelligent messaging is one of the key areas in which wireless carriers can add value," says Cindy Christy, vice president of advanced mobile phone service and PCS policy management at Lucent Technologies Inc. (www.lucent.com). Some products are available, such as Communicator 9000 from Nokia Corp. (www.nokia.com), that combine small keyboards with wireless phones, but they are not in wide use. Bernstein expects to see an avalanche of consumer devices that combine wireless access with data services. Mobile computing has not been a major success story for most wireless carriers. Their services, including proprietary offerings from companies such as BellSouth Wireless Data LP (formerly Ram Mobile Data) and industry standards such as Cellular Digital Packet Data, have been used primarily in vertical industry segments, such as law enforcement and field service dispatch. "It's a natural migration for messaging to move to wireless phones and for wireless to become the primary voice phone," says Brian Bortz, manager of DMS- 100 wireless product marketing at Nortel. "But mobile data users also want Internet access. It's a different thing to say, 'I'm going to use my wireless phone for things like that.' " Net Voice For Wireless Look for wireless providers to try to cash in on one of the biggest developments on the wireline side: voice-over-Internet Protocol services. The big reason is cost: Providers could use IP transport to avoid paying local access and long-distance charges. AT&T Corp. and Sprint Corp. could be first into the wireless voice-over-IP game. Both have wireless national networks and are building IP backbones, says Herschel Shosteck of Herschel Shosteck Associates Ltd. Also watch for new IP backbone providers, such as Level 3 Communications Inc. and Qwest Communications International Inc. <<Inter@ctive Week -- 09-21-98>> [Copyright 1998, Ziff Wire]

To: Frank A. Coluccio who wrote (1375)	9/25/1998 9:41:00 AM
From: Frank A. Coluccio	Read Replies (2) \| Respond to of 3178

I-Link to Further Expand Its IP Telephony Network, Making it Available to 60% of the U.S. Population September 25, 1998 DRAPER, Utah, Sept. 24 /PRNewswire/ via NewsEdge Corporation -- I-Link Inc. (Nasdaq: ILNK), an enhanced voice and data communications company, today will announce plans to further expand its IP (Internet protocol) telephony network in 1999, making it available to 60 percent of the U.S. population. The announcement will be made at I-Link's National Conference in Salt Lake City. "When completed in 1999, I-Link's expanded IP telephony network will include thousands of cities in such far-flung metropolitan areas as Atlanta, Baltimore, Boston, Cincinnati, Detroit, Indianapolis, Kansas City, Louisville, Memphis, Minneapolis, Nashville, Sacramento, San Antonio, San Diego, San Francisco, St. Louis, and Washington, D.C., just to name a few," said John Edwards, I-Link chairman and CEO. "Now that we have proven that we can successfully layer our IP technologies on top of any type of telecommunications infrastructure -- be it a copper, fiber optic or mobile system -- we are ready to bring our enhanced communications services and great long-distance rates to the majority of the U.S. population via our IP telephony network." I-Link claims to have the largest IP telephony network in the U.S., bringing enhanced services and long-distance rates as low as 4.9 cents per minute to customers in more than 200 cities in the greater Los Angeles/Orange County, Dallas/Ft. Worth, Houston, Phoenix and Salt Lake City metro areas. (I-Link previously announced its intent [Aug. 13] to also expand its enhanced services IP telephony network into the New York City, Chicago, Seattle, Orlando, Fla. and Pittsburgh, Pa. markets by Jan. 1, 1999.) "The expansion of I-Link's IP telephony network will make it that much easier for our representatives to sell I-Link's enhanced and traditional communications services," said Jon McKillip, vice president of sales and marketing for I-Link Worldwide. "The upside is that as we bring new areas online, more and more of the U.S. will be able to have long-distance rates as low as 4.9 cents per minute. In addition, we will also bring local access to V-Link(TM) -- our powerful environment for enhanced communications services -- to more than one-half of the U.S. population. That's also very exciting." "Building" a Virtual IP Network "Interestingly, due to the design of our IP software and our low-cost IP routers, we have been able to 'build' a virtual IP telephony network by using new or existing copper wire or silicon strands deployed by other communications companies," said Bob Bryson, I-Link vice president of product marketing. "Not only that, but I-Link uses this infrastructure 10 times more efficiently than existing carriers. As a result, not only do we not have to spend hundreds of millions or billions of dollars building a new network (as many other companies are doing), but we also don't have to tie up as much infrastructure to achieve our goals. "This is not to say that we don't control and manage the underlying infrastructure in our IP telephony network, because we most definitely do. It's important to remember, however, that we also created the technologies that allow us to create this virtual IP telephony network at a fraction of the cost. In fact, the more of this IP telephony network we deploy, the less expensive and more profitable it becomes to operate." Preliminary Details of I-Link's Expanded IP Telephony Network Specific details of the individual calling areas served by I-Link's expanded IP telephony network will be released today at its National Conference in Salt Lake City. A preliminary list of the metropolitan areas that will be covered by I-Link's expanded IP telephony network when fully deployed in 1999 is shown below in alphabetical order, followed by the area code(s) which will be fully or partially served per metro area. (A complete list of the cities served in each metro area will be released as I-Link's IP telephony network is deployed.) Akron, OH: 330 Albuquerque, NM: 505 Atlanta, GA: 404, 678 Austin, TX: 512 Bakersfield, CA: 805 Baltimore, MD: 301 Birmingham, AL: 205 Boca Raton/West Palm Beach, FL: 561 Boston, MA: 508, 617, 781, 978 Bridgeport/Hartford/New Haven, CT: 203 Charlotte, NC: 704 Chicago, IL: 312, 630, 708, 773, 847 Cincinnati, OH: 513, 606, 812 Cleveland, OH: 216, 440 Columbus, OH: 614 Dallas/Ft. Worth, TX: 214, 254, 903, 940, 972 Dayton/Springfield, OH: 513, 937 Detroit, MI: 248, 313, 810 El Paso, TX: 915 Fresno, CA: 209 Ft. Lauderdale, FL: 954 Grand Rapids, WI: 616 Houston, TX: 281, 409, 713 Indianapolis, IN: 317, 765 Jacksonville, FL: 904 Kansas City, MO: 816 Las Vegas, NV: 702 Los Angeles, CA: 213, 310, 323, 562, 626 Louisville, KY: 502, 812 Memphis, TN: 901 Miami, FL: 305 Milwaukee, WI: 414 Minneapolis/St. Paul, MN: 612 Nashville, TN: 615 New York City/Newark, NJ: 201, 212, 516, 718, 732, 908, 914, 917, 973 Oakland, CA: 510, 925 Orange County, CA: 714, 949 Orlando, FL: 407 Philadelphia, PA: 215, 412, 609, 610 Phoenix, AZ: 602, 907 Pittsburgh, PA: 412 Portland, OR: 503 Providence, RI: 401 Riverside/San Bernardino, CA: 714, 909, 949 Sacramento, CA: 916 Salt Lake City, UT: 435, 801 San Antonio, TX: 210, 830 San Diego, CA: 619, 760 San Francisco, CA: 415, 650 San Jose, CA: 408, 415 Seattle/Bellevue/Everett, WA: 206, 425 Spokane, WA: 509 St. Louis, MO: 314, 573 St. Petersburg/Tampa, FL: 813 Tacoma, WA: 206, 253 Tucson, AZ: 520 Tulsa, OK: 918 Washington, D.C.: 202, 410, 757 "When you add it all up it's a pretty impressive list," Edwards said. "This list includes more than 100 area codes, representing thousands -- perhaps tens of thousands -- of individual towns and cities across the country. I-Link will soon be able to offer the close to 125 million residents of these areas local access to high-quality enhanced communications services previously unavailable to them and at incredible price points." Founded in 1994, I-Link Inc. is an enhanced voice and data communications company that uses Internet protocol (IP) telephony and its own private network to provide low-cost long-distance, conference calling, voice mail, fax, e-mail and other communications services. I-Link's products and services are primarily offered through a network marketing channel. Through wholly owned subsidiaries MiBridge Inc. and ViaNet Technologies Ltd., I-Link develops emerging communications technologies that are used by I-Link and other leading communications firms worldwide. I-Link is headquartered in Draper, Utah, and its Web site is located at i-link.net. The statements made in this release that are not historical facts contain forward-looking information that involves risks and uncertainties. Important factors that may cause actual results to differ include, but are not limited to, the impact of competitive products and services, the company's ability to manage growth and acquisitions of technology or businesses, the effect of economic and business conditions, and other risks detailed from time to time in the company's filings with the Securities and Exchange Commission. SOURCE I-Link Inc. /CONTACT: Media: Scott Corfield, 801-523-3730, 801-949-7002 (cellular), scorfield@politis.com, or Kevan Barney, 801-523-3730, 801-949-7001 (cellular), kbarney@politis.com, both of Politis Communications; or Financial: Karl Ryser Jr. of I-Link Inc., 801-576-5025, karlr@i-link.net/ /Web site: i-link.net (ILNK)