Kurt, Do you think we can get this "momentumguy" a job at General Magic writing PR?
Don't really want to turn this into the Qwest page but thought this article might interest people who don't know what Qwest is all about and just how aggressive and ready they are to break the mold. The link comes from Network World, but it's pass protected.
It's a very long article mostly talking about networks, but the beginning is well worth reading.
Regards, Mark
nwfusion.com
Qwest throws down pricing gauntlet
By David Rohde
Network World, 12/14/98
Arlington, Va. - For a year now, upstart carrier Qwest Communications has seemed the epitome of hype - an IP renegade with apparently little more to offer users than a consumer-oriented voice-over-IP service in a handful of cities.
That's all about to change.
Qwest revealed to Network World last week a new line of enterprise services in the basic categories favored by the Big 3 carriers: frame relay, ATM, private lines and Internet access.
But Qwest will offer some major twists: pure usage-based billing, voice carriage over packet networks, souped-up service-level agreements (SLA) and - true to CEO Joe Nacchio's word - much lower prices.
Qwest's account representatives have marched into the field with eye-popping data-service deals. The company told Network World that it is offering T-1 frame relay at nearly $1,100 per month less than AT&T. Qwest says it will offer T-3 ATM ports at about one-fourth of AT&T's price.
To complete users' networks, Qwest can offer standard frame relay and ATM permanent virtual circuits (PVC). But the company's account representatives are pushing an alternative: switched virtual circuits (SVC).
These circuits, which larger carriers have for the most part avoided, eliminate the need to preprovision paths between network nodes. And SVCs make it possible for any corporate site to send data or voice traffic to any other site without prepaying a monthly fixed circuit charge.
For SVCs, Qwest will charge simply for the amount of traffic sent, ranging from less than 1 cent to 4 cents per megabyte across a full spectrum of eight quality-of-service classes of frame relay and ATM service.
Despite the pricing advantage, users, analysts and Qwest officials agree the carrier faces an uphill battle to dislodge AT&T, MCI WorldCom and Sprint from enterprise accounts with long-term contracts.
"The costs are really, dramatically low," says Jim Mercer, IT director at Gerald Metals, a commodities trading and distribution company based in Stamford, Conn. "But I wouldn't jump on it right away. I'd have to do a pilot."
"The dollar amount will really pique people's interest," adds Tom Walton, president of Walton and Walton Associates, a network consultant and integrator based in Richmond, Va. "But I don't think anybody is going to just fall over, even if they brought it in for half the price or one-third the price."
If price won't swing it, maybe expertise will. Qwest has been raiding talent from Sprint and MCI WorldCom's large base of network engineers, especially in the Washington, D.C. area near Qwest's data-services network operations center (NOC). Qwest will be heavily promoting the experience of these engineers.
IP to hype, frame to sell
From the beginning, Qwest has marketed itself as a next-generation IP carrier and has crowed about its massive 18,449-route-mile SONET network, which is capable of carrying aggregate traffic at 2.5G bit/sec OC-48 speeds now, and will be capable of 10G bit/sec OC-192 speeds in the future.
But that image has masked the fact that from a switching standpoint, Qwest really has two domestic networks - one based on IP routing and one based on frame and ATM switching. And it's the second nonpure IP network that Qwest is currently using to deliver enterprise services.
The Qwest frame/ATM network consists of 28 switching locations, each equipped with Ascend 500 ATM and Ascend 9000 frame relay switches, managed by Qwest technicians at NOCs here and in Dublin, Ohio.
By contrast, the IP network, consisting of 17 locations that are being outfitted with Cisco's GSR 12000 super-fast routing switches, is still a work in progress. Qwest is currently selling dedicated Internet access but does not plan dial-up access or an IP virtual private network (VPN) service until sometime next year.
Because of the dual frame relay/ATM capability, users can choose frame relay for some sites and ATM for others and still maintain a single WAN, says Mack Greene, Qwest's director of product marketing for frame relay, ATM and private lines. From the start, the network supports not only the five standard ATM service classes but also three classes of frame relay.
If a user chooses traditional frame relay PVCs, each PVC is assigned one of three classes of service. The premium type, called Variable Frame Rate (VFR) real time, takes priority over others in case of congestion, and is designed for applications such as SNA. The second type, Variable Frame Rate non-real time, takes ordinary priority and is designed for LAN interconnection. The final type, Unspecified Frame Rate (UFR), is more of a best-effort circuit for lower priority applications.
PVC prices will vary accordingly. For every 8K bit/sec of committed information rate - guaranteed bandwidth that can't be squeezed if the network gets congested - users will pay $8 per month for VFR real time, $6 for VFR non-real time and $4 for UFR.
The five standard types of ATM PVCs - ranging from a private-line emulation circuit known as constant bit rate (CBR) down to a best-effort circuit known as unspecified bit rate (UBR) - will also vary in price. CBR will cost $4.50 per month per 8K bit/sec of reserved bandwidth, while UBR will cost only 50 cents per 8K bit/sec.
Mixed blessings
But for users who are willing to choose SVCs, the prices are strictly usage-based. That can be a mixed blessing, according to some analysts.
"I have my doubts about the usefulness of either SVCs or usage-based billing," says Johna Johnson, vice president for global networking strategies at META Group, a consultancy in Stamford, Conn. "The nice thing about frame relay is that you know exactly what you're going to pay month by month."
Qwest officials acknowledge that the usage-based billing could make some users nervous. "They're concerned about the cash register being open until the end of the month," Qwest's Greene says.
To sweeten the pot, Qwest sales representatives have been given a special promotion to wave in users' faces. For customers who agree to try frame relay SVCs, Qwest will provide the first 100G bytes of traffic free for each of the first three months of a service term. Those who pick ATM SVCs will get 1,000G bytes free for each of the first three months.
Several customers pointed out that because most companies would try any service before installing it, the promotion may mean that the entire first three months' usage is free except for port charges.
And part of the idea behind the promotion is to give users a chance to see their usage patterns risk-free for a few months so they're not hit with sticker shock later, Greene says.
Big advantage
Users who employ SVCs to get the free traffic may see another big advantage. Often the only traffic traveling between branch offices is voice, while data travels exclusively from branch to data center. That's not usually enough of a justification to install PVCs between branches and pay the fixed monthly fee.
So users can employ Qwest's SVCs for intracompany voice calls among branch offices without having to prepay for a branch-to-branch PVC that might not be used for anything else. And because Qwest charges by the megabyte, Greene claims that with 8K bit/ sec compressed voice on Qwest's ATM service, employees can talk for 17 minutes for less than 1 cent.
For conservative users, Qwest has a traditional VPN circuit-switched voice service, which carries a traditional per-minute toll charge. But the company will let users decide whether to pay regular tolls or eliminate them by placing phone calls over the data network. Some users find that enticing.
"I think that's a better approach," says Jeff Hafer, manager of telecom engineering for GPU Energy, a power company based in Reading, Pa. "The tendency is that when a vendor is pushing you in a certain direction it has nothing else to offer." With Qwest "you feel more like there's nothing hidden behind the curtain," Hafer adds.
Supplementing the frame and ATM offers will be an SLA that offers data-throughput guarantees that vary by class of service.
But some prospective operational issues may trip up Qwest's efforts.
One Atlanta-area AT&T user says he's concerned that if he puts voice on Qwest frame relay or ATM SVCs, he will have difficulty figuring out how to charge the expenses back to departments. "I can't imagine what my tables would look like to charge back to my users," he says. "Part of what we've worked for with AT&T is simplification in pricing. Qwest's class-of-service and usage-based pricing doesn't do that."
Catching up
Qwest is also starting out behind the Big 3 carriers in other areas. For example, Qwest does not yet have any of its own managed-router or managed frame relay access device programs, in which the carrier takes responsibility for configuring and maintaining the user's WAN equipment.
One way Qwest hopes to catch up to the Big 3 in managed services and certain performance-monitoring activities is with an aggressive hiring program that so far has hit the big carriers where they live.
Sprint has proven a particularly fertile hunting ground for Qwest headhunters. It all started last year when Qwest hired Paul Nemirovsky as vice president of data services, after he had spent 15 years at Sprint and its affiliates, most recently the international alliance Global One. Since then, Nemirovsky estimates that 50 to 70 employees or full-time contractors have come over to Qwest from Sprint and Global One.
Why? At Qwest "there's more appreciation of their technical skills and less of the red tape," Nemirovsky says. "There's more freedom to do what people enjoy, and see the results of their work."
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