October 1998

BY BROUGH TURNER

Will Internet telephony ever find its way into the home? IP telephony is already penetrating the business community - companies are adopting voice over IP as a way to save on long-distance charges for voice and fax communications. New backbone networks like Qwest and Level 3 are using IP to carry long-distance telephone traffic. Companies such as Selsius Systems, NBX and PakNetX, in addition to major networking players such as Cisco, are working to extend IP telephony onto the business LAN. Displacing the PBX and ACD may take longer than re-doing the long-distance backbone, but the direction of the enterprise VoIP trend is clear (to all but the traditional PBX vendors, it seems). But what about Internet telephony at home?

There are IP telephony services sold to home users today, but these are not a replacement for conventional telephone service. Today's home IP telephony user typically requires a dial-up Internet connection - dialed over the conventional voice network. They also need a PC, or an adapter to adapt a conventional telephone set to voice over IP. What will it take for IP telephony to replace conventional telephony in the home?

In the U.S., the commercial force to drive this transition will be competitive local exchange carriers (CLECs) trying to get into the residential telephone market. Reselling RBOC services is not a viable CLEC strategy, and running new copper cable to everyone's home is inconceivable. However, offering toll-quality IP telephony as part of a broadband Internet access package could be the cost-effective alternative necessary for CLECs to successfully compete with the RBOCs. To realize this scenario, CLECs need access to the home. For this type of service to take off, a viable home LAN must emerge.

CONNECTING TO THE HOME
Many would-be providers are looking for new ways to provision local phone service without running new wires to every home. Wireless local loop (WLL) will make sense as the cost of wireless electronics continues to follow Moore's law, but WLL is expensive right now. Leasing copper wires from the existing RBOCs, in order to compete with them for their traditional service - simple telephony - is a risky business. Besides, both approaches are still just traditional telephony, switched with a traditional CO switch. New forms of wideband IP connectivity for Internet access are the most interesting path for CLECs to follow to build new business and offer voice telephony solutions that compete with incumbent providers.

As I discussed in my June 1998 CTI� column ("Internet Access: Improvements in the Air"), cable modems and DSL technology are beginning to provide wideband, always-on IP connectivity to the home. Currently, cable modems are ahead of DSL, but both are viable. Although fewer than one million homes have broadband Internet access today, deployments are accelerating - the milestone of one million subscribers appears to be less than a year away. As more homes get broadband Internet connections, the tables are turned: Telephony becomes an interesting value-added service, beyond the broadband Internet connection. And, with broadband Internet connectivity, voice over IP becomes a sensible approach to telephony. Without an IP network in the home, though, you're forced to adapt back to traditional telephones or are limited to a single IP telephone set.

CONNECTIVITY WITHIN THE HOME
With cable modems or xDSL service today, the incoming line terminates in a special modem that typically sits on the table near your computer. This modem has an Ethernet connector on it. In most cases, your ISP provides you with a single IP address - you can plug in one computer and surf the Web at relatively high speeds. My experience with this kind of cable modem setup has been excellent. Internet access is actually better at home than at work, where I share a T1 connection with fellow workers.

On the other hand, one IP address supports only one computer. In order to connect multiple computers - and ultimately multiple IP telephones - it is necessary to have a network and multiple IP addresses. To provide this solution today, you must connect a network address translation (NAT) function, a proxy server, and perhaps a firewall to the cable or DSL modem. Then, you need to install an Ethernet hub and run Ethernet wires to the other computers. This setup may be a simple task for an engineer, but it doesn't work for the average homeowner.

For the moment, let's table the issue of extra IP addresses or NAT, and just look at implementing the home LAN. LAN technology has saturated the business world, but there are few home LANs. There's no MIS director (in most homes) to connect everything and keep the components running, and most homeowners are unwilling to rewire their homes with new cable. Even if homeowners wanted to rewire, Category 5 cable is not available at most home centers.

Is there a way to use the existing wires in the home - the electric wiring or telephone lines? Alternatively, could we bypass the problem with a LAN that used short-range radio (much as cordless telephones do today)? Indeed, there are groups following each of these approaches.

USING EXISTING POWER WIRES
Home LAN technology running over power wires has been around for over a decade - not for IP, but for low bandwidth control of lights, thermostats, and other similar devices. Indeed, power wires are a rather alien environment for data signals. Consequently, power line LANs can be very low cost, but only at relatively low data rates (typically less than 100 Kbps). To build multi-megabit LANs that run over power lines requires electronics as sophisticated (and expensive) as those for wireless LANs.

Current power line home LANs include X-10 Ltd.'s X-10 technology, the Electronic Industries Association's Consumer Electronic Bus (CEBus), and Echelon's LonWorks. X-10 has been used for over a decade in many home automation systems, and the Web is full of information on products that can automate a home - controlling lights and appliances, drapery, heating systems, garage doors, and surveillance systems, to name a few.

The CEBus specification was adopted by the Electronic Industries Association (EIA) in October 1992. This specification describes a local network for exchanging control information and data among devices in the home. And, in April 1998, the Consumer Electronics Manufacturers Association (CEMA) adopted a new standard for home networks based on LonWorks. This standard supports both existing power wires in the home and Category 5 cabling. In this instance, the bandwidth is potentially useful for Internet access and voice over IP, but Category 5 cable is only likely to be used in new home construction.

USING THE TELEPHONE WIRES
Another wiring option, with some powerful industry players behind it, is to use existing telephone wires to create high-speed LANs in the home. The Home Phoneline Networking Alliance (HomePNA), formed in June of this year, intends to release a specification by the end of 1998. Founding members of this alliance include 3Com, AMD, AT&T Wireless, Compaq, Epigram, Hewlett-Packard, IBM, Intel, Lucent Technologies, Rockwell Semiconductor Systems, and Tut Systems.

The principle advantage of using existing telephone wires is that you don't need to rewire existing homes. The electrical environment is more benign than that of power wires, but the electronics are still complex, as the LAN data signals are processed to avoid interfering with standard telephony on the same lines. Initially, HomePNA has adopted 1 Mbps technology from Tut Systems, with plans to release specifications for a 10 Mbps variant by mid-1999.

Both solutions - using power lines or existing phone lines - eliminate the hassled of pulling Category 5 cables into the walls. The HomePNA technology looks very promising for 1999 and 2000. But as the price of wireless electronics comes down, wireless LANs will be a contender.

USING WIRELESS
Wireless LANs provide complete mobility for the devices in the network; there is no need to be near a power socket or phone jack. Wireless LANs are also capable of supporting very high speeds (greater than the 10 Mbps), although most current contenders only provide 1-2 Mbps of bandwidth. Wireless LAN products for the home from vendors such as Proxim are already on the market. The HomeRF Working Group, which comprises more than 40 companies from a range of industries, was formed in March 1998 to ensure interoperability between radio frequency (RF) devices in and around the home. And, within the Ethernet community, the IEEE 802.11 committee approved a wireless connectivity standard in June 1997. Unfortunately, 802.11 is not a single standard, but a compromise that endorses several non-interoperable approaches. However, as Moore's law works to drive down wireless electronics costs, wireless LANs should be the eventual winner.

KEEPING IT SIMPLE
There are multiple solutions available and under development for the physical infrastructure of the home LAN. But who will make the home LAN simple enough that consumers can actually use it? Consumers need to be able to go to a local store, buy a product, take it home, plug it in, turn it on, and have it "just work" - with no outside support required. Vendors such as Proxim are trying to build wireless LANs as simply as Ethernet LANs (the hubs and cables a sophisticated home PC user can buy today). That's a first step, but it's not enough to make the home LAN really take off.

The ideal home LAN must conceal all the messy details. Initial systems will likely use a PC connected to the cable or DSL modem. This PC will run the firewall software, IP address server, and/or network address translation unit. A better approach will be to bury these functions within the DSL or cable modem. The other piece of the simple LAN will be new LAN devices that use these buried services to auto configure the unit - a plug and play LAN. When this home LAN technology hits the market, most likely in the next two to four years, we can expect to see IP telephone sets that plug into these LANs, and telephony services over your wideband Internet connection.

EXCITING TIMES AHEAD
With home LANs and IP telephones, CLECs will now have a way to sell broadband IP connectivity, and will offer voice and fax service over the same network. Instead of installing 5ESS switches, CLECs will be using voice over IP technology - leading-edge in 1998, but viable and extremely competitive two to five years from now. The competitive local voice and fax services market is going to be hot in the next five years. We should expect to see an incredible amount of market turmoil beginning in the next two years, with winning wideband access solutions appearing in the next five years. If you are looking to start a new business today, there are dozens of opportunities in this space. Internet telephony will reach the home. These are exciting times - stay tuned!

Brough Turner is senior vice president of technology at Natural MicroSystems, a leading provider of hardware and software technologies for developers of high-value telecommunications solutions. For more information, call Natural MicroSystems at 508-620-9300 or visit the company's Web site at www.nmss.com. E-mail to the author (rbt@nmss.com) is also welcome.