Monday, January 30, 2006
What makes the Internet so great is that it is a collection of networks connecting the world together —Metcalf’s Law comes true. The Internet with all its connected networks has contributed greatly to the last two decades of innovation in industry. Now that we have come to depend on it for daily living, we need to be able to manage the services that flow over it. BT is a leader in offering QoS for retail services and charge on a pay as you go basis. Other European providers do the same. North American consumers should have the same choice.
If application providers understood the benefit to managing QoS over the entire connection, then they could control their customer’s experience and manage their costs better. Google can leave their search engine service as best effort because it does not matter if it takes a few extra milliseconds for a result to come back. Vonage, on the other hand, would benefit by prioritizing its packets as they travel through the network. With deterministic latency and jitter, their voice service will have higher MOS and less service calls. Costs will decrease and customer satisfaction will increase so they can truly compete with POTS. Application/service providers that took advantage of guaranteed QoS would most likely pass the added cost on to the consumer receiving a double bump by increasing revenue and decreasing support costs.
What is missing is consumer control of QoS. If Yahoo!, Google, MSN, Vonage, Skype each gave their service the highest priority, the result to the user would be no different than the best-effort service they get today. The user needs some control over service prioritization. Manufacturers need to include QoS management tools in their CPE. D-Link is one such company that is developing broadband home routers and integrated access devices with QoS management tools. More are jumping on the bandwagon like Jungo, a popular CPE software application developer.
Why shouldn’t consumers be able to purchase these devices and have them work with their Internet access services? Smart QoS enabled CPE would automatically detect applications that need higher priority or have a higher QoS marking and appropriately balance the packet queues. The majority of users would not have to even know anything other than time sensitive applications like voice and video work great. Consumers would be more apt to stream video from Netflix or sign up for VoIP service. I see implementation of QoS on consumer Internet access as a boon to the industry.
Tags: VoIP, RBOC, Google, Vonage, D-Link, QoS
Sunday, January 29, 2006
Many rational people and organizations are interpreting AT&T’s, BellSouth’s, and Verizon’s statements to charge a premium for premium services as their attempt to cripple services in competition or that do not pay their ransom. Jeff Pulver blogged that if Internet service providers were allowed to do this it would be the end of the net as we know it. Consumer’s Union has even entered the fray against the RBOC stating that it will amount to walled gardens. Of course the RBOC executives are not masters of oratory. They have not adequately clarified their statements.
Opponents are missing the point that all packets are not created equal! Video and voice packets are not the same as e-mail, web browsing, ftp, and other applications that travel over the Internet. I want my video without blocks and voice without it sounding like HAL in a bucket. Businesses have the option of paying for prioritizing certain traffic and so should ordinary residential users. In its fledgling days the applications that ran over the Internet were not time sensitive or even mission critical. Today people depend on the Internet for financial transactions, voice communications, and critical business correspondence just to name a few. Our dependence on this IP medium will continue to grow in the future. We need ways to say that some traffic is more important than others. That is what the RBOC are offering. It is called service assurance.
Now that consumers groups and the mainstream media have sided against the evil telecommunications providers, we are almost assured that a solution will be legislated. Internet application providers like Google and Vonage who have always wanted less regulation will see their efforts backfire. What irony.
Communications companies always seem to be the worst at being able to communicate. The three RBOC should clearly state their intentions for this higher tiered service. As long as it did not violate my Internet User’s Bill of Rights, then there is nothing wrong with them offering it as a service complete with service level agreements. Watch how quickly Google and others jump on the bandwagon to create a superior user experience. I would certainly like to see it on my VoIP service. Let’s have an industry symposium to resolve this issue before it enters the legislative process.
Tags: VoIP, Verizon, Google, Vonage,, BellSouth, Jeff Pulver
Thursday, January 26, 2006
Tonight I attended the 6th Annual Denver Telecom Professionals meeting. Four local visionaries were to present their perspectives on the outlook for the year. The panelists speaking were:
Phil Weiser, Esq. Founder and Executive Director, Silicon Flatirons Telecom Program, University of Colorado (Moderator)
Gregg Sutherland, Partner, Ernst & Young
Dan Yost, Executive V.P. Products and Marketing, Qwest
Bill Mosher, VP of Marketing and Sales, Comcast Colorado
Michael Kalac, VP Enterprise Network Engineering, First Data Corporation
Phil, as usual, did an excellent job moderating the panel, and the panelists spent their time between talking about projects already in progress and a little about what is in store for the industry during the year. No one made any bold predictions about any major breakthroughs or mergers and acquisitions. There were a couple of gems if you could read between the lines. Suffice it to say the prognosis was for a calm year:
- VoIP will continue its slow roll out.
- Qwest will still push its DSL deployments and bundle four-play services.
- Comcast will expand its popular OnDemand offerings and Digital Telephone service (VoIP).
- Everyone will continue to work on operational and business improvement.
- 2006 will be the year that VoIP becomes mainstream. Businesses see the ROI on VoIP and the E-911 and CALEA issues can be solved. Last year more IP PBX were sold than TDM PBX. Locally Avaya and Level3 stand to benefit from increased VoIP deployments.
- Wireless and wireline services will become seamless for business customers and residential early adopters. Think IMS. Verizon Wireless, Sprint-Nextel, and T-Mobile will continue to make inroads to business customers at the expense of the incumbent wireline carrier.
- QoS will be offered by Internet service providers as soon as they convince Internet application providers (i.e. Google, Yahoo!, Vonage, etc.) and subscribers that the increase in cost is a small price to pay for a superior service experience and they will not debilitate any best effort services.
- BellSouth will experience a M&A event. AT&T will want to bring Cingular into its fold and make a bid for BellSouth's portion.
- Qwest will lose business customers to AT&T and Verizon and continue to investigate M&A events.
- Podcasting and Vlogs will change how traditional media and content distributors operate. The impact will be felt this year, but most of the traditional outlets will not fully embrace it because they are afraid of tackling the DRM issues and breaking from status quo.
Tag: DTP, Denver, telecom
Sunday, January 22, 2006
Although they did not initially clearly articulate their intentions, the “Big Three” are advocating introducing tiered service levels in their networks. It is about time that the major carriers in North America started to offer quality of service (QoS) options for its residential and business customers. Most business data services have had some form of service assurance for the past few years, but not residential data services. AT&T, BellSouth, and Verizon should be praised and supported in their efforts to offer QoS and service level agreements (SLA) across their networks as long as they do not abuse it to their benefit. My hope that it will spur upgrades to their networks to increase bandwidth and improve service quality.
Other Internet service providers such as Vonage, 8x8, Google, Yahoo and others mistrust the RBOC’s intentions. Their suspicion is that the RBOC will use QoS mechanisms to block or degrade their services in order to give preference to RBOC services. Let’s hope that this is not their intention. Internet service providers should abide by an Internet User’s Bill of Rights:
Article I: The access provider shall block no services to the user unless they are causing harm to the network.
Article II: The access provider shall give no preference to their own services unless they offer the same preference to competing providers at equal cost.
Article III: The user should be able to pay and manage a higher quality of service.
If a carrier abides by this Bill of Rights, then the Googles and Netflix of the world can compete on a level playing field with the RBOC and the user experience will be improved. I would certainly pay an extra $5 per month to Vonage or Comcast to insure that my VoIP calls will have a mean opinion score of 3.8 or better. Presently the public Internet is a best effort service. Time sensitive services have varying quality which leads to an inequality towards the service provider since they can guarantee the experience of the services that are confined to their network. This effort by AT&T, BellSouth, and Verizon will allow service providers such as Vonage to provide the same user experience as BellSouth’s VoIP service.
I applaud the RBOC’s effort, and I hope that Qwest, the cable companies, and other internet service providers offer similar capabilities for their access services. Internet access providers should form an industry coalition to define implementation and interoperability of QoS levels. This would enable service providers to provide consistent service level agreements across the Internet. Such a coalition would circumvent intervention by the FCC or other regulatory agencies. Let’s hope that the industry can come together to benefit consumers though higher quality and increased services over the Internet.
Tag: AT&T, BellSouth, Verizon, RBOC, Internet, QoS
Thursday, January 12, 2006
Free markets have a funny way of reaching equilibrium when people and governments try to manipulate them for their own benefit. Sorry to disappoint those in the blue states, but SBC’s acquisition of AT&T and Verizon’s acquisition of MCI prove that things that don’t make sense have a way of working out. I learned this fact very early in my career from a sage Department Head (Clark Ryan) in AT&T Bell Labs. As a logical thinking Electrical Engineer, I never thought that the structure of the divesture of AT&T in 1984 made sense, but logic had nothing to do with it. The design of the breakup was orchestrated by bureaucrats, lawyers, and accountants, not engineers for the most part.
Think back to the early 80’s when AT&T’s long distance and equipment businesses were the cash cows for the company. Business and long distance services were providing most of the revenue and profit for the company. Western Electric, which was to become AT&T Network Systems, dominated the market for almost every major category of equipment. Through these two divisions, AT&T could continue its dominance on the U.S. telecommunications market…or so they thought.
Shedding the labor and capital intensive local telephone business seemed like pure genius at the time. Most wire centers needed expensive upgrades to digital switches and an upgrade to the outside plant. Billions of dollars needed to be invested in this part of the business which would affect earnings for decades. If AT&T could divest them of this burden, then they were free to invest in computers, ala NCR, and international expansion. Their lack of success in computing is well chronicled. Their international expansion in equipment fared much better, but selling services proved much harder.
The divestiture was approved by Judge Green and the Regional Bell Operating Companies (RBOC) was created. AT&T was left standing with its business and long distance services, equipment arm, and world renowned Bell Laboratories. Up and coming executives like Joe Nacchio, Carly Fiorina, and Rich McGinn were the futures of the company…or so it seemed at the time. The wheeler-dealers in the company at the time continued to make bad business and investment decisions. The equipment and computer arms of the company were cut off into NCR, Lucent Technologies, and Avaya. Later Lucent spun off the semiconductor division into Agere Systems. Carly and Joe headed to greener pastures and Rich took over the helm at Lucent Technologies. All three underperformed at leading their companies while making exorbitant salaries.
What was left at AT&T was a failing long distance business and lack-luster performing business services. Their brief foray into wireless and residential broadband services ended by selling the divisions off to Cingular and Comcast, respectively. AT&T did not have much of a future for itself except an excellent brand and a host of top tier business customers. In contrast, the RBOC have worked for years to break down the artificial barriers imposed by divestiture. The Telecommunications Act of 1986 allowed them into long distance as long as they could prove that there was competition in markets where they wanted to offer long distance services.
The writing was more than on the wall. Customers wanted a full service provider. SBC and Verizon wanted to fill that missing link in their service offering which is why SBC decided that it made sense to purchase AT&T and Verizon sought MCI. These moves put back together the network that divestiture broke up. Business and residential subscribers could now purchase services from a single provider no matter where they were located. Billing and maintenance are greatly simplified for the consumer. Of course, there were the usual regulatory and consumer complaints but these two acquisitions made perfect sense to give customers the products and services they desire.
As consumers, we have competition and lower prices due to economies of scale. AT&T and Verizon can now offer subscribers the services they want without artificial barriers. They can offer most of these services globally to their customers. A new class of “megacarriers” is beginning to emerge from the ashes of divestiture. Look for these companies to make more acquisitions of video companies. Finally the shackles of divestiture are disappearing and the consumer will benefit from it.
Tag: AT&T, SBC