Standards, Vendors, and Wireless

1
Standards, Vendors, and Wireless

• BAD 64046
• Kent State University
• 12 February 2003

2
Standards Development and Interoperability Testing

• Voice and data standards are shaped mainly by
• ITU International Telecommunications Union
• Historically, the standard-setter for telephone
• Roots to 1920s and CCITT (International Telephone
  and Telegraph Consultative Committee)
• ITEF Internet Engineering Task Force
• Now important because of the growing dominance of
  packet-switched networks

3
Cooperation Needed

• ITU and IETF must coordinate standards to support
  smooth migration to a single integrated network
  that supports all telecommunications services
• Many other standards bodies are involved in both
  wireless and wireline standards

4
Myriad Standards Initiatives

• Telcordia promoting interoperability between the
  PSTN and packet switched networks
• TIPHON project testing VoIp interoperability in
  Europe
• iNOW! Is seeking to coordinate vendors to achieve
  interoperability among VoIP telephony vendors
• European Technical Standards Institute

5
Market Overview - Service Providers

• Industry is moving inexorably toward a single
  multiservice packet-switched network
• A very small number of supercarriers will
  dominate
• LECs, IXCs, PTTs are all adapting to the changing
  marketplace
• Service providers like MCI Worldcom are trying to
  become supercarriers

6
Becoming a Supercarrier

• Several approaches
• Build complete new, huge infrastructures
• Modify and supplement legacy networks
• Merge, to combine strengths and markets and
  reduce overhead
• Newer carriers have the edge
• Already have a big foothold in the
  packet-switched world without huge overhead from
  a legacy phone business

7
MCI and Sprint

• MCI Worldcom and Sprint tried to merge in early
  2000
• Plans were abandoned
• Combined company would have been twice as large
  as SBC, the next largest competitor

8
Who Is Doing What?

• ILECs and PTTs
• Being forced by competition to widen offerings
• Many have become ISPs
• Expanding their data networks to become one
  integrated network
• Must take care not to cannibalize away their own
  voice service revenue base

9
Who Is Doing What?

• IXCs
• ATT, MCI, Sprint (KDD in Japan)
• Trying to penetrate the local loop market
• Incumbents still control 80 of local loop
• ATT purchased TCI and MediaOne so as to be able
  to offer voice and data over cable

10
Who Is Doing What?

• CLECs
• Some CLECs are facilities-based
• Other CLECs lease bandwidth from the ILECs
• Utilities are becoming CLECs
• Electric utility in Europe can easily add data
  over power
• Cable operators in the US are well positioned to
  compete in the local loop

11
Who Is Doing What?

• Backbone Carriers
• New carriers are emerging without legacy
  incumbrances
• As bandwidth becomes commodity, new firms will be
  able to compete by adding value-added services
• Next Generation TELCOs
• Intermedia, Qwest, Williams Communications
• Backbone Wholesalers
• Hermes Europe Railtel, Enron

12
Who Is Doing What?

• ISPs
• Many are now business units of LECs, such as
  PacBell Internet and BT Internet
• Some focus on business market
• MCI Worldcom UUNet, PSINet, AUNET (Asia)
• Many offer value-added services
• VPNs, managed data services

13
Who Is Doing What?

• Retail ISPs
• AOL
• Customer service and marketing, with tech
  outsourced
• Earthlink
• Cable ISPs
• Utilize the existing CATV plant
• Cable operator does not operate the data service
• Excite_at_Home and RoadRunner

14
Who Is Doing What?

• Cable Operators
• 90 of U.S. homes have cable access
• Thus, cable operators are well positioned to
  become integrated voice and data carriers
• No local loop barrier
• This is why TCI and MediaOne were acquired by
  ATT
• Less dominance in Europe

15
International Telecommunications Routes

• ATT and MCI Worldcom have the two largest
  networks
• New entrants Cable and Wireless, Global
  Crossing, PSINet, Qwest, Teleglobe (Canada)

16
Major Projects

• Global Crossing
• Building six undersea and two terrestrial fiber
  systems to link 159 cities in U.S., Asia, Europe,
  Latin America
• Qwest
• 21,000 km cable from California to Pacific Rim
• Teleglobe
• Investing 5 B, expanding into 160 international
  markets

17
Major Projects

• AC-2
• Global Crossing Level 3 Communications building
  1.28Tbps 4-fiber-pair cable between the U.S. and
  U.K. (September 2000 cutover)
• FLAG Pacific-1
• FLAG Telecom dual cable trans-Pacific, 22,000 km,
  linking North America to Tokyo
• 5.12 Tbps per cable (two each)
• FLAG Atlantic-1
• Similar, and recently placed in service
• Overall FLAG 28,000 km, 16 landing points in 13
  countries

18
CABLE SPLICE OF FLAG ATLANTIC-1 CABLE COMPLETED
Connection between UK and France completed
at 17.30GMT on Thursday 8 February London, 15
February 2001 FLAG Telecom (Nasdaq FTHL LSE
FTL), a leading independent global carriers'
carrier and network services provider, today
announced that the company has successfully
achieved the final splice on the UK to France
section of the FLAG Atlantic-1 (FA-1) cable
system. FA-1, a dual multi-terabit cable system
connecting London, Paris and New York, is at an
advanced stage of construction and is scheduled
to enter commercial service in March 2001. Ed
McCormack, COO of FLAG Telecom, said "We are
delighted to have achieved this next significant
milestone in the development of FA-1. The cable
system is scheduled to enter service next month
and the mid-Atlantic splice, completing the
first of two transatlantic links, is scheduled to
occur within the next two weeks. FLAG Telecom is
building one of the largest and most extensive
global networks and FA-1 is a key element in our
worldwide plans. The flexibility and quick
response that infrastructure ownership affords
enables us to deliver a wide range of products
and services that anticipate and exceed the
demands of a wide spectrum of customers." FA-1
was announced in January 1999 as a joint venture
between Global TeleSystems (GTS) and FLAG
Telecom. During Q4 2000, FLAG Telecom completed
the purchase of Global TeleSystems's 50 holding
in FLAG Atlantic Limited, the project company,
for a cash consideration of 135m. As a result,
FLAG Telecom now owns 100 of FLAG Atlantic
Limited and the assets and liabilities were
consolidated as from the date of completion of
the transaction. Pre-sales of 800m have already
been obtained on the FA-1 system. The system
is being built as a loop system. FA-1 is planned
to consist of three self-healing, high-capacity
loops with twin terrestrial access points
connecting seamlessly into other FLAG Telecom
networks. The interlink now completed connects
the shore landings in France to the shore
landings in the UK. The cable, stretching over
14,500 kilometres from Europe to the USA, is
expected to provide secure end to end circuits
to almost all of the major business centres
worldwide.
19
Major Projects

• Project OXYGEN
• Planned global undersea fiber network connecting
  all except Antarctica
• 169,000 km of cable initially
• 97 landings in 76 locations
• 2.56 Tbps
• Not fully complete until 2003

20
Major Projects

• TyCom Global Network
• 85,000 km undersea fiber network
• TyCom Global Network
• 2.56Tbps
• Service by end of 2002

21
Benefits from Competition

• International bandwidth will quadruple in next
  two years
• More satellite systems are coming online
• International voice will become a commodity
• Significant price declines will be the result
• Predicting 80 decline in tariffs over next 5
  years

22
Bandwidth Exchanges

• Bandwidth is increasingly an undifferentiated
  commodity
• Like wheat and oil, then, there will be trading
  exchanges and futures markets
• Band-X and RateXchange are early marketplaces
• For carriers buying and selling wholesale telecom
  capacity

23
(No Transcript)
24
Representative Transponder Detail - Japan and
Korea
25
Telecommunications Equipment Vendors

• ATT has stopped buying traditional telephone
  switches
• Thus, all switch manufacturers are acquiring
  network equipment vendors that are in the IP
  world
• Network vendors switching focus from enterprise
  networks to the service provider customer market
• Network service providers are refocusing on
  differentiation through customer service

26
How to Migrate to the Converged Network ?

• Modify existing circuit-switched product lines to
  include packet-switching
• Acquire completely new packet switching lines
• The six major vendors are doing either or both
• Alcatel, Cisco, Ericsson, Lucent, Nortel, Siemens
• All are expanding their product portfolios by
  incorporating applications such as billing

27
The Stock Market

• 2001s down stack market is severely limiting the
  ability of telecom vendors to expand product
  lines
• U.S. firms are at a differential disadvantage vs.
  European competitors because of the shortage of
  capital and low equity valuations

28
Market Data

• 1999 global telecommunications revenue was 790 B
• 36.8 local phone servic
• 24.7 long distance
• 21.3 wireless
• 10.5 international
• Packet switched revenue still very low (12.8 B
  by 2003)
• 81.1 of this was via Frame Relay
• ATM projected to have 12.3 by 2003

29
More Market Data

• Internet traffic revenue
• Projected to grow 28. from 1998 to 2003
• 100 of companies over 100 employees have
  Internet connectivity and 87 have a web presence
  (!)
• More VoIP, FoIP, and unified messaging will speed
  up Internet traffic growth
• 18 of enterprise voice traffic will travel via
  IP by 2002

30
Who Is Big ?

• In spite of growth of IP, the incumbents are
  still the biggest
• 1. ATT 64.4 B
• 2. NTT 60.1B
• 3. SBC 49.0 B
• 4. Deutsche Telekom 43.2 B
• 5. MCI Worldcom 33.9 B
• 6. Bell Atlantic 33.2 B

31
Forecasts - Technologies and Services

• Shift from circuit-switched to packet-switched
  world will continue, creating a need for bridge
  products
• VoIP growth will explode
• Carrier network architectures will simplify
• Optical wavelength switching will allow carriers
  to sublease entire wavelengths to enterprise
  customers
• QoS guarantees on IP circuits will continue to be
  a challenge
• ILECs are at a competitive disadvantage because
  of the legacy infrastructure

32
Forecasts - Technologies and Services

• Business customers will offload support and
  management to service providers
• Billing and order entry web-based self service is
  coming
• IP based VPNs will dominate as the platform of
  choice for WANs
• Secure extranet VPNs will proliferate for
  intercompany communications
• VoIP reliability will slightly impede its
  corporate adoption
• IP networks will take over ATM and Frame Relay as
  QoS issues are resolved

33
Forecasts Bringing Services to the User

• Next three years intense competition to deliver
  up to 2Mbps to residential customers
• Computer industry will push for this so that the
  new apps that will drive new computer purchases
  can be supported (stock market)
• Distinctions among voice, data, FAX, video, will
  become inconsequential
• In enterprise, LAN convergence will lead WAN
  convergence by several years

34
Forecasts Bringing Services to the User

• Fortune 500 enterprises wll be the last to
  migrate to packet-switched networks because of
  legacy problems
• Total outsourcing will be the solution for many
  large enterprises
• New residential competition entrants will have to
  rely on cable, power line, and wireless because
  of domination of the ILECs
• Customers in city centers will have a lot more
  connectivity choices

35
Forecasts Bringing Services to the User

• DSL and cable will come to dominate residential
  service in the U.S. B-ISDN in Europe
• DSL costs will continue to drop
• The distinction between fixed and mobile services
  will dissolve
• Managing ATM on a complex IT network will
  continue to challenge

36
Forecasts Changing Pricing Models and Industry
Structure

• Distance and time of day charges will disappear
• Bandwidth-based, flat rate, traffic-based, and
  timed-usage based pricing models will dominate
• Graduated QoS pricing will come soon
• Long distance billing per call will become
  uneconomical
• Value added services will be key as traditional
  network revenue will not be a long term source of
  profitability

37
Forecasts Changing Pricing Models and Industry
Structure

• Customers will not care about underlying
  technology, giving carriers new flexibility
• Global supercarriers will try to become
  comprehensive providers for large customers
• Will arrange for other-network reversion in case
  of outages
• By 2002 there will be four or so supercarriers
• Between 2,000 and 4,000 domestic and regional
  niche carriers will exist at any point in time

38
Forecasts Deregulation

• Wireline local access networks will be the final
  frontier for deregulation
• Some national governments will try to protect
  entrenched incumbents
• Slow deregulation will hinder growth worldwide
• Government interference in architectures will
  slow innovation
• Entry of the RBOCs into the U.S. long distance
  market will be complete soon and will press
  prices further downward

39
Forecasts Deregulation

• Most data over cable carriers will allow ISPs to
  provide services over their cable infrastructure
• This will be mainly in response to pressure from
  public opinion

40
First Generation Analog Systems

• AMPS (Advanced Mobile Phone System)
• Uses FM
• Two sets of channel pairs in each market area (A
  Block and B Block)
• Channels are 45 MHz apart, with uplinks between
  824-849 MHz and downlinks 869-894 MHz
• Lowest 21 channels per block are 10Kbps digital
  control channels
• All nationwide roaming analog phones must be AMPS
  compliant

41
Second Generation Digital Voice Technologies

• Dual mode phones are primarily digital, but use
  AMPS as backup when a digital systems is not in
  range
• Major systems are IS-136 and GSM, based on TDMA
  and CDMA
• Can also carry circuit-switched or
  packet-switched digital data
• See http//www.privateline.com/PCS/Digiprinc.htma
  nchor105628

42
Digitization

• Analog signals are varying voltage patterns

Digitization requires sampling
43
Time Division Multiple Access

• Interweaves up to 10 digital signals onto one
  high speed channel by assigning time slots
• IS-54 and, more recently, IS-136 provide
  standards guidance for TDMA digital telephony
• IS-136 allows carriers to upgrade one channel at
  a time from AMPS to digital
• IS-136 divides each channel into six slots, and
  one call uses two of them

44
Second Generation Technology (continued)

• Digital voice compression
• VSELP (Vector Sum Excited Linear Predictive)
• Generates a 13Kbps data stream
• 8Kbps is speech, 5Kbps is error correction
  overhead
• Speech bits are sorted into three priority
  classes
• Authentication
• Encrypted using challenge-response with secret 64
  bit keys stored at the MSC and in the phone
  device hardware
• IS-136 also supports short e-mail and paging
  messages sent on the control channel

45
Global System for MobileCommunications

• In 1980s there were nine different and
  incompatible cellular standards in Europe
• CEPT (Council of European PTTs) developed more
  unified standards, called GSM (Groupe Special
  Mobile)
• GSM applied to the 900 MHz band
• In early 1990s, GSM 1800 and GSM1900 emerged

46
Global System for MobileCommunications

• GSM-1800
• Primarily a European standard
• GSM-1900
• Primarily a North American standard
• GSM uses 200 Khz channels with eight time
  slots/channel -- supports four calls
• The 200Khz channel is incompatible with AMPS
  30Khz channels, so is only used for PCS in
  1900MHz range

47
Global System for MobileCommunications

• GSM also is encrypted to prevent cloning of
  phones by capturing the identification number of
  the portable unit
• System relies on storage of keys for the portable
  systems at the switching center
• GSMs encryption method has been cracked
• SIM (Subscriber Identity Module) enables you to
  change equipment, and even will enable
  international portability
• GSM supports 9.6Kbps FAX and data service
• Dominant in most of rest of the world except
  Korea and Japan

48
Code Division Multiple Access

• A spread spectrum alternative to TDMA, proposed
  by Qualcomm
• Assigns pseudorandom codes to the bit stream
  associated with each call
• Codes (generated at 1.2288Mbps and mixed with te
  9.6Kbps speech stream and transmitted)
• Sounds like noise
• Reduces susceptibility to interference on one
  frequency
• Adjacent cells can operate on the same frequency
  because there are 128 codes available
• Turns off the transmitter during voice lulls

49
1G and 2G Cellular Telephone Data Transmission

• Circuit-switched cellular
• Easy with a properly equipped cellular phone
• Billed based on call-duration
• 9.6Kbps or 14.4Kbps max
• Inefficient use of the channel spectrum
• Requires dial-in to gain access
• No additional infrastructure cost

50
1G and 2G Cellular Telephone Data Transmission

• Cellular Digital Packet Data (CDPD)
• Data is packetized and sent at idle times on the
  AMPS network
• No dialup required
• Does not waste spectrum
• Each packet is transmitted independently
• Mobile Data Base Station (MDBS) deployed in each
  cell
• MDBS scans AMPS channels for idle channels

51
1G and 2G Cellular Telephone Data Transmission

• CDPD has no connection to the PSTN
• All communication is via the Internet or a
  private IP network
• Maximum raw data rate is 19.2Kbps, but this is
  not implemented very widely
• A multivendor standard
• No equivalent to CDPD on 2G digital systems -- it
  arrives with 2.5G

52
Short Messaging Service

• 2G digital systems
• Data is sent via the control channel
• Supports paging, cellphone to cellphone messages,
  weather and sports scores
• 160 characters in GSM, 256 in IS-136
• Popular in Scandanavia