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First Quarter 1998


A Next-Gen Telco

BY FARA HAIN

As with any emerging industry, much confusion exists in the perception of who the Internet telephony players are and how they differentiate themselves. The public tends to group all of the players in a new industry together as competing factions. The field of Internet telephony is varied, and the players come in many shapes and sizes -- some compete and some complement each other. As the industry grows exponentially, there arises the need to group the individual Internet telephony players into two distinct categories, those involved in the development of VoIP technologies and those making use of VoIP technologies to provide services.

The first group -- core technology developers -- is made up of those companies that create the software, hardware, and compression algorithms that make Internet telephony happen. They are the developers, research teams, and programmers behind the wave of Internet telephony products and services in the marketplace. Even in the technology category, the players cannot be lumped together. There are those who write the codecs, the software developers, the hardware developers: Some companies do all three.

The second group, known as Next-Gen Telcos, bring this burgeoning gateway technology to the masses and service customers who use VoIP technology for their telecommunications needs. As the market grows, the companies included in the service provider category begin to differentiate themselves. Some concentrate on the domestic US residential market, others on the international arena, and still others on the carrier market. Many of these companies have their own research and development teams, driving the technology players to meet consumer needs. One such company is Delta Three, providing both PC-to-Phone and Phone-to-Phone services via pre- and post-paid calling cards to residential and SOHO customers as well as to corporations and telecommunications companies.

Delta Three, originally saw VoIP as an opportunity to provide inexpensive phone services to Israeli immigrants from Russia who were paying over 2 dollars a minute to call their relatives back home. Provisioning services to an immigrant population taught Delta Three to trust their instincts; that there would be a tremendous market opportunity created by reducing the cost of phone calls, and that call duration would increase relative to the drop in price. By January, 1997, Delta Three was able to offer Phone-to-Phone IP services from the United States and Canada to Israel, Russia, and Colombia.

As Delta Three continued to build out a global network, and satisfy needs of its customers, the company began to struggle with the issue of large-scale implementation of VoIP. Delta Three's carrier and corporate customers needed to pass large quantities of traffic over the network in order to reap any benefits from the cost savings of VoIP. Enter RSL Communications, a facilities-based carrier controlled by entrepreneur Ronald S. Lauder. For RSL COM to route calls over the Delta Three network, a seamless transmission platform was needed to connect RSL COM's standard telephony switch and Delta Three's Internet telephony gateway. Delta Three and RSL COM technicians were able to develop a platform integrating the two switches, and RSL COM began routing traffic over the Delta Three network in June, 1997. Today, Delta Three manages an international telecommunications network that seamlessly integrates circuit-switched and packet-switched networks - truly next-generation telecommunications. The Delta Three global network, fully meshing legacy telecom with IP telephony, is joined by RSL COM, as well as other carriers and PTTs who wish to provide VoIP services to their customers.

Through the network, Delta Three provides VoIP calling plans from the US and Canada to any location on the globe. A network of over 15 hubs allows the company to pass millions of minutes of voice traffic over the Internet every month. The company now services thousands of residential customers, as well as corporations and telecommunications companies.

For more information, contact Fara Hain, associate vice president of public relations and marketing, at 212-588-3670, send e-mail to info@deltathree.com, or visit the company's Web site at www.deltathree.com.

 



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