September 1998

BY DENNIS L. MIGA

The traditional facsimile is universally accepted as a basic channel for business communications. As fax technology penetrates even the most remote business locations, the international marketplace is experiencing dramatic growth in the sale of fax equipment and transmission services. Even with roughly 40 million fax machines in the world, fax use is still dramatically on the rise. On a global basis, fax traffic in 1996 generated $92 billion in billings for telecom carriers, about 15 percent of the total amount paid for telecommunications traffic, with an even higher ratio in developing nations. However, in second and third world nations, the projected completion rate of an international fax is less than 40 percent.

Due to the shortcomings of some regional telephone systems and the high cost of international long-distance services, end-users have sought a more efficient way to deliver their business fax communications. This combined quality/cost challenge has driven the search for a more efficient fax delivery technology and is the engine driving the global Internet-based fax revolution.

NEW FAX TECHNOLOGY
The creation of an innovative new generation of Internet-based facsimile networks has made international faxing simpler, more reliable, and less expensive. International Internet-based fax-to-fax capabilities are based on a relatively new, but not especially complicated technology, similar to traditional phone-based fax technology, with one essential difference. Rather than depending on costly and often unreliable international telephony networks to carry fax transmissions around the globe, new networks can use the Internet backbone to move facsimile communications instantly and smoothly to any point on the globe.

How It Works
The originating device, which can be either a PC or a standard fax machine, generates a fax message, forwarding the message over standard phone lines to a local node provided by an Internet-based fax service provider. From that node, the fax message is transmitted via the Internet to the appropriate remote node and on to the destination fax machine. The provider also maintains a centralized control location, which monitors and administers the integrated global network.

A typical international node configuration consists of a PC-style server hosting today's powerful new generation of fax processing software. This server links the node with the Public Switched Telephone Network (PSTN) via analog lines, providing user access in the area being served. The node is linked to the Internet via a router, a CSU/DSU, and a dedicated high-Kbps access line.

Today's fax-to-fax networks also utilize central control facilities to apply sophisticated fax administration, monitoring, and diagnostic techniques. Network congestion is minimized through the use of multiple connections with the public network and the Internet at the T1/E1 level. Furthermore, in a well-planned network, forwarding all faxes via encryption ensures security.

Services
Specialized services available from today's more intelligent Internet-fax services can include:

• Fax resend capabilities: Allow the completion of a fax transmission even when a subscriber has misdialed, thereby virtually guaranteeing delivery.
• Accounting codes: Enable customers to enter an identifying code with each fax for security and cost allocation.
• Encryption features: Eliminate security concerns during fax transmission.
• Confirmation reports: Send immediate e-mail or fax messages indicating the status of each fax transmission.

These and other capabilities make Internet fax transmissions the channel of choice for organizations of all sizes and types, especially in second and third world nations. As awareness of this new Internet-driven alternative grows, international fax-to-fax communication will constitute an expanding segment of Web-based traffic.

BENEFITS OF INTERNET-BASED FAXING
Internet-based fax-to-fax technology provides a proven wealth of end-user benefits. By utilizing the TCP/IP Internet backbone to distribute faxes on a global basis, the high-cost of long-distance charges associated with traditional telephone faxes are eliminated and can reduce fax-related costs up to 90 percent. A Gallop/Pitney Bowes study conducted in 1996 showed that on average, a U.S.-based Fortune 500 company spends approximately $37 million a year on telephone services, of which 41 percent (about $15 million) is for fax communications. By leveraging the economies of Internet-based fax-to-fax technology, a similarly situated international company could therefore cut its fax-related costs by as much as $13.5 million a year.

Internet faxing also vastly improves the throughput and reliability of facsimile messaging. Today's most sophisticated Internet fax networks employ a range of advanced technologies to ensure maximum delivery success. Store-and-forward technology accepts the sender's fax message and sends it to the proper destination within five minutes. The transmission is automatically retried if the destination line is busy, without requiring the sender to dial again in order to get the fax through. In the event that the fax cannot be delivered, a notice of non-delivery is automatically sent to the sender via fax or e-mail. Utilizing these powerful technologies, Internet-driven fax networks can provide a delivery reliability score upwards of 95 percent.

Internet-based faxes also eliminate the quality problems associated with poor international, long haul transmission facilities. With constantly improving Internet standards and technologies, the crispness and clarity of Internet fax-to-fax quality will only get better.

Internet-based faxing using a standard fax machine does not require Internet access, a computer, or any specialized software. There are no new dialing schemes to learn and network access and billing codes can be programmed into a dialer or the sending fax machine's internal speed-dialer.

This technology also gives end-users access to a growing range of sophisticated communication capabilities. Depending on the Internet-fax provider's capabilities, enhanced services can include facsimile tracking, redundancy protection, encryption, branded fax formats, programmed auto-dialing, and broadcast fax delivery.

COMPETITIVE CONSIDERATIONS
Potential end-users should be aware that not all Internet-based fax networks are alike.

Network integrity is a key issue for international fax end-users because they rely heavily on the security and dependability of fax communications. Private Internet-driven fax networks, in which the Internet-fax provider owns and operates a proprietary data system capable of interfacing with all public switched telephone systems worldwide, provide the optimum balance of reliability, efficiency and cost savings.

Another core problem that has challenged fax network providers in developing countries is the difficulty in placing and maintaining nodes in so many diverse and unique locations. Many have struggled in the attempt to "push" this technology into distinctive international market locations and the result has been slow network build-out and less-than-optimum coverage.

One distribution strategy, however, has overcome this local "in-country placement" challenge. In this model, an integrated alliance of independent local partnerships is built to operate local nodes and to market Internet-based fax services to users in each area. These local partners handle and overcome the unique business and cultural challenges of each location, thus simplifying the rapid placement of nodes and leveraging very quickly the proven economies of Internet faxing.

A final factor that differentiates one fax-to-fax provider from another is the core server technology that supports the Internet fax network. While many such networks rely on a Microsoft NT operating system, today's most advanced, high-volume networks utilize the more robust and stable UNIX operating system, the same technology used to build the public Internet.

Organizations of all sizes can now enjoy dramatic cost savings, while guaranteeing the quality and reliability of international fax transmissions, by moving quickly to this new generation of Internet-based fax-to-fax technology. By recognizing the clear benefits of Internet faxing, and by selecting the most appropriate fax network provider, international business can enjoy improved, more reliable fax service at a much lower cost.

Dennis L. Miga is CEO and founder of INTERFAX. Founded in 1995, INTERFAX LP is a privately held provider of international network services via the Internet. Through its proprietary, UNIX-based network, INTERFAX offers quality fax services at discount rates on a worldwide basis. More information on INTERFAX can be found at www.interfax.uk.com.