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Technology Stocks : PairGain Technologies -- Ignore unavailable to you. Want to Upgrade?

To: porcupine --''''> who wrote (28251)	1/28/1999 5:19:00 PM
From: bronco2	Read Replies (1) \| Respond to of 36349

Interesting article on Level 3's IP-telephony network at Network World I posted this article because on the conference call last night, it was indicated that pairgain was supplying (I assume its Hi-gain stuff) the T1 equipment mentioned in this article. They also mention that they will be beta testing **LOCAL IP-TELEPHONY* services in 9 months to a year. Looks like LEVEL 3 could be a good customer for pairgain. nwfusion.com Don't bother going there unless you don't mind registering. The following are some of the article: "Level 3 crows about IP voice, fire-sale prices By Tim Greene Network World, 01/25/99 OMAHA, NEB. - If you think you just cut a good deal on your long-distance service, think again. Level 3 Communications is promising long-distance voice services starting later this year that are 20% less expensive than those of its competitors. To prove its network's mettle, the company next week will demonstrate its voice-over-IP technology to Wall Street analysts in New York. Level 3 will show off voice quality by placing calls over the network while the analysts view a diagram of how calls travel through the company's net. ....................... "Our goal is to build a company that can drop the cost of moving a bit . . . at a rate of tens of percent per year. If we do that, we're going to see demand go up even faster," Crowe says. "Now that's phenomenal," says John Welsh, communications engineer at Applied Systems, Inc. in University Park, Ill., maker of software for independent insurance agencies. "I'd say send me more information." He says there are factors to consider beyond just the per-minute rate, such as the cost of the T-1 to connect to the Level 3 network. The big three long-distance carriers - AT&T, MCI WorldCom and Sprint - will eat two-thirds to three-quarters of the cost of the local T-1 in order to win long-term contracts, Welsh says. That can amount to $750 or more per month per T-1. He says he would also want to hear the quality of Level 3's voice. ...................... If all goes well with beta tests, starting later this winter, the service will be rolled out by year-end to 25 cities. ........................ The net impact for corporate customers? "Voice service at a big discount to what they are currently paying, with quality that is just as good and a cost structure that promises to improve not two or three or four percent a year, but at tens of percent a year," Crowe says. Corporate customers will buy a dedicated line into a Level 3 point of presence (POP), much as they do today with traditional long-distance services. That differs from the model followed by many IP-voice services, which require each caller to dial a POP and punch in a personal identification number before dialing the desired number. Initially, Level 3's IP-voice service will be backed up by traditional circuit-switched voice service that the company will buy in bulk from other long-haul carriers, Crowe says. The traditional voice network will act as a spillover if the IP network runs into technical problems. As Level 3 works the glitches out of its software, the need for a backup will fade. Indeed, the Level 3 CEO says he will sell no IP telephony service before its time. "If this was not new code and we were absolutely certain that it was rock solid, we would go commercial today. But the reason that we and everybody else beta-tests is because there is always a process of eliminating bugs." Local IP-telephony service is another nine months or a year away from beta-testing, Crowe says. So far, Level 3 has made its money selling leased lines, Internet access and managed modem services, as well as housing customer Web and telephony gear in its switching offices. The IP voice is more along the lines of what people expect from Level 3 based on its all-IP manifesto. But Crowe says setting up Level 3's 16,000-mile fiber backbone and selecting hardware to run it takes time. "