The high tech and telecom economies might be in the
doldrums, but none of this seems to be affecting the volume
of news items that comes across TMC's transom. The last
couple of weeks have been no exception -- some companies are
releasing some innovative and timely products and services,
while others are starting to come forward with big customer
wins and intriguing case studies. Here is a sampler of some
of the more interesting tidbits I've recently come across.
When In Doubt, Blame It On The Bells
Two new free, online reports, produced by Bruce Kushnick and
the Baby Bell-pounding New
Networks Institute blame the Bells for causing the
current telecom "recession" and aim to serve up some
controversial, and even compelling, bits of information.
They certainly made for entertaining, thought-provoking
The first report, entitled The Bells Caused The
Current Financial Recession: The Fiber-Optic Fiasco And
America's Copper Dirt Road, lays out a series of related
events and actions on the part of the Bell Companies that
have contributed to the tech sector crash and will hamper
the sector's recovery and the roll-out of broadband
services. NNI claims that the Bell companies have failed to
roll out their broadband services as promised, and have
engaged in longstanding anticompetitive behavior in the face
of regulations and laws obligating them to open up their
monopolies to competition.
This behavior, according the researchers, has scared away
investment and diminished the growth prospects in the tech
sector. The study asks some tough
questions, such as "Did America just spend $50 billion in
higher phone charges for the same 75-year old copper
network?" and "Is America going to end up a third-rate
The second study addresses the beleaguered CLEC market,
and likewise pulls no punches. In The Bells Harmed The
CLEC Industry: Bell Funded Study By Brooking's Crandall On
CLECs Is Flawed, NNI takes the position that the Bell
companies' anti-competitive behavior and lack of enforcement
has been the major impediment for competitors to offer local
phone and DSL/Broadband services, not the Competitive Local
Exchange Companies' (CLECs) business plans as some would
Linux IP Telephony Market Gains Momentum With New
Windows XP may have grabbed more than its fair share of
mind, what with the promised inclusion of collaborative
computing and Internet telephony features in Microsoft's new
OS. For those of you who champion the open source movement,
take heart -- there is a growing momentum in the Linux
realm, with two more products available to add to the
burgeoning selection of PC-to-PC Linux-based offerings.
Free Phone is a new application available for Linux and
Unix multimedia-ready (soundcard, speakers, and microphone
installed) computers that can be used to make PC-to-PC VoIP
calls. Free Phone, developed by the French research firm
INRIA, is based on the real-time transport (RTP) protocol,
which is gaining support as a standard for Internet-based
voice and video communications. A notable feature is
something its developers call "packet reconstruction," which
supposedly provides decent voice quality even in the event
of packet loss. To download a copy of Free Phone for Linux,
If you're a Linux user interested in making a conference
call over the Internet, (a la "Net Meeting"), there is a new
tool called the Robust Audio Tool, developed at University
College in London. This piece of software, also based on RTP,
supports Internet-based audio conferences with two or more
users, and runs on Unix, Windows NT, and FreeBSD, as well as
Linux. To download Robust Audio Tool, go to http://www-mice.cs.ucl.ac.uk/multimedia/software/rat/download.html.
Light The Candles -- All Two Billion Of Them!
This past week, ITXC Corp.
routed its two billionth minute of paid voice traffic. ITXC
began service in April of 1998 and passed the one billion
minute milestone late in 2000. Almost all of its traffic
consists of phone-to-phone international calls that ITXC
transmits over the Internet using patented and
patent-pending proprietary routing technology to achieve
Callers call from one phone or fax machine to another in
the ordinary POTS fashion. Often, callers have no idea that
their carriers hand calls off to ITXC for transmission over
the Internet and local call completion by an ITXC affiliate
somewhere in the world. More and more often the major first
tier carriers of the world use ITXC.net, the company's
117-country voice network. Tier 1 traffic has increased from
3.6 percent of total traffic in the second quarter of 2000
to 29.1 percent of traffic in the second quarter of 2001.
One of the indicators of quality is the average length of
a call. A new 2001 FCC report entitled Trends in the
International Telecommunications Industry indicates that
the average minutes per message on calls in 1999 coming from
the U.S. and going to a location outside the U.S. is 5.4
minutes. The average length of a call on ITXC.net as of July
10, 2001 was 6.4 minutes.
By most accounts, ITXC is the largest provider of
wholesale voice over IP service. And apparently it is also
the telco industry's model citizen -- get this -- according
to the company's Chairman and CEO, Tom Evslin, ITXC has not
issued any debt securities and has no substantial debt of
any kind! The fact that ITXC can pull this off is a great
commentary on the capital-efficiency of building a network
using the Internet for infrastructure.
IBM's New Telco Push
Shaken by earnings shortfalls, and the resulting massive
staff cutbacks, many telecommunications companies are
cutting spending in an effort to restore profitability.
While telecoms should be cost conscious with their IT
infrastructure spending, cutting too deeply will hamper the
company's ability to compete in this tough market. The
Federal Reserve has recently stated IT is vital for
productivity, and that there is a strong correlation between
IT capital accumulation and labor productivity.
IBM's Global Communications Sector is offering telecoms
strategies for reducing cost structure. A strong IT
infrastructure is critical in helping telecoms reduce costs
in an area that's proving to be expensive for them:
implementing new broadband services for their customers. IBM
works with companies to improve internal processes and
identify alternative vendor billing systems. IBM ties
together hardware, software, and services into a packet that
makes it less expensive for telecoms to connect their
customers to new services.
Examples of some additional IBM offerings to lower costs
and improve IT efficiency include Asset Management, where
telecoms can sign multi-year contracts and purchase complete
solutions from IBM at a discount; Selective e-sourcing,
which helps reduces operating costs for telecoms, while
improving availability, security, and capacity; and
Innovative Financing. For one customer that wanted to embark
on a new project but was short on cash and computing power,
IBM purchased outdated equipment from the customer, upgraded
it, and leased it back at a cost matched to expected income
from the new project.
Marc Robins is vice president of publications at TMC and
associate group publisher for INTERNET TELEPHONY magazine.
Marc has been covering the communications industry since
1980, and his column takes a look at some of the more
interesting trends vying for attention in our industry.
Please contact Marc with comments at email@example.com.
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