Printer Friendly

ISDN deployment and the CPE marketplace.

ISDN DEPLOYMENT AND THE CPE MARKETPLACE

Telco deployment plans for ISDN have been filed with the FCC. One BOC intends to make a big investment. Washington is mandating ISDN capability in its user interfaces to FTS-2000.

ISDN CPE vendors are developing new strategies to create demand by small and medium businesses. The National Telecommunications and Information Agency (NTIA) is reviewing the telecomm infrastructure.

There is a good chance the ISDN CPE market will enter a demand pull phase by 1994.

Push And Pull

Most telecomm products and services start with a technology push phase. A growing number of customers buy for reasons of availability, novelty, and price even if the benefits are not fully defined.

Examples include color TV, PCs, and VCRs. Demand created by availability and novelty sustained sales until demand pull took over.

This occurrence--"critical mass" in Figure 1--can be defined as "when demand becomes sufficient to take over from the push phase."

If product acceptance never reaches this point, the market effort fails to gain total user acceptance. ISDN CPE products have not yet reached market-critical mass.

ISDN Deployment

Figure 2 shows RBOC deployment plans for three new technologies. These data were compiled from telco responses to FCC Common Carrier Docket 89-624.

Digital switching and SS7 are considered priority technologies by major telcos.

The former improved local network service offerings by making CLASS services available. The latter makes the network more cost-effective by cutting down on call processing time.

ISDN in the local loop is not a priority technology. End-to-end digital connectivity cannot be used by subscribers with analog phones. Replacing these phones with a data terminal does not make economic sense if there is no demonstrated demand for new data services.

RBOCs view ISDN as an added expense without a corresponding increase in revenue. This is the down side.

There is an up side. A number of positive developments are taking place in how service providers, users, and vendors view ISDN potential.

Three key communities are promoting ISDN.

BellSouth

Southern Bell gave the FCC higher deployment projections for ISDN than other BOCs.

Over 1.5 million access lines will be fully deployed with ISDN BRI by 1994. BellSouth's Southern Bell serves Florida, Georgia, and the Carolinas.

Jack Hullings, ISDN services product manager for BellSouth, says ISDN is part of "an aggressive technological and marketing posture."

Lornia Mosely, BellSouth operations manager of network planning, says "fully equipped for ISDN" means the correct switch-generic software is installed, the switch is ready for ISDN line cards, and all short and medium loops are ready for ISDN signals.

Mosely says interworking between the 5ESS and DMS-100 will happen in 1991. "CPE vendors will be involved. Trials will commence the first quarter."

"ISDN can provide end-to-end solutions for small and medium business users," says Hullings.

"This includes software and hardware availability to carry out PC-to-PC and PC-to-host applications. This experience will be gained by BellSouth by an ongoing dialog with vendors, and some strategic alliances.

"ISDN is a value-based service. This is where our investment becomes worth it," Hullings maintains.

Federal Government

The General Services Administration is a key player in ISDN deployment.

Its procurement plans for user interfaces to the FTS-2000 backbone specify ISDN compatibility at all levels. Central Zone 1, one of 10 regional procurements, covers Illinois, Indiana, Ohio, Michigan, and Wisconsin. About 33 sites and 30,000 lines are involved. The first systems will be cut over within 24 months of the contract award.

The RFP spec reads: "The contractor shall follow the North American adaptation of applicable CCITT and Q-series (ANSI T1.60X series) recommendations for the provision of ISDN. All switching system hardware and software provided shall be 'ISDN-ready.'"

Ameritech dominates local-area service in Central Zone 1. This procurement will have a big impact on its telephone infrastructure. Figure 3, extracted from the RBOC's reply to NTIA, indicates Ameritech expects significant demand for ISDN to surface the next few years.

Vendor Middlemen

A small company based in Raleigh, N.C., sees ISDN as an chance to reduce the paperwork burden of small businesses. Roger DuCharme says his Business Communications Applications was formed to bring ISDN to real-estate brokers, furniture retailers, and financial institutions in the form of paperless transactions.

"We are a middleman," he says. "We talk to the end user, we translate paper transactions into applications software, we enlist the aid of an ISDN CPE vendor, and we go to the service provider. CBA identifies customers, applications, and provides the sales force; the telephone company deals only with the network."

CBA's parent--RP Teletrends, Raleigh--employs Jan Brandstadter as director of ISDN programs. He also chairs the Business Applications working group of the North American ISDN Users' Forum. "We need this kind of middleman," he says, "to step forward and help the ISDN applications process. CBA can identify ISDN communities of interest which use the network to make things happen."

Brandstadter, who has several RBOCs participating in his working group, believes the key area which needs improvement is telco understanding of ISDN data services potential.

NTIA Inquiry

NTIA has spent the best part of this year requesting comment on the information infrastructure. Janice Obuchowski, assistant secretary of commerce and information, says she's afraid the U.S. will fall behind in the knowledge industries unless more attention is paid telecomm. "We would like to quantify the linkage between a highly developed information infrastructure and economic productivity," she says. "U.S. business wants benefits of things like ISDN. If the government can help by recommending reduced rates of depreciation on some telephone equipment, it should do so."

The RBOCs say deployment of new technology in the network was retarded by rate-of-return and depreciation restrictions, that the U.S. network was thus becoming inferior to those in other developed countries.

On the other hand, the ICA says the U.S. network is the best in the world and there is no need to spend money on improving it.

Some network providers, users, and vendors are prepared to take a chance on ISDN.

For the CPE market to reach critical mass, there must be a strong technology push phase followed by the identification of enough money-saving business applications to create ISDN demand pull.

This is starting to happen.

Southern Bell says it will deploy 1.5 million ISDN access lines by 1994.

Washington mandates ISDN compatibility in its own network.

Vendors are forging relationships with users and service providers.

This synergistic process might just work.

A lot depends on how many players are prepared to buy into ISDN.

The end user is the key to ISDN acceptance.

Show small business how to save money with ISDN, and it is well on the way to achieving critical mass.
COPYRIGHT 1991 Nelson Publishing
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:integrated services digital network; customer premises equipment
Author:Stewart, Alan; Berteau, Donald
Publication:Communications News
Date:Jan 1, 1991
Words:1117
Previous Article:Washington State plugs leaks; subadministrators help Bill Allen keep tabs on sprawling PC-LAN environment.
Next Article:NT1: key to basic-rate access; ISDN update.
Topics:


Related Articles
FCC's Role in Integrated Services Digital Networks Seen as One of Monitoring Not Participation.
Toward the Private ISDN; A View of Corporate Voice-Data Networks.
Centrex returns to life as practical alternative to PBXs.
FLOWPOINT UNVEILS ADSL ROUTER WITH ALCATEL'S DYNAMITE CHIPSET.
XPEED SIGNS RESELLER AGREEMENT WITH ASCEND COMMUNICATIONS.
Mother, may I connect at higher speeds more cheaply?
THREE SERVICE PROVIDERS SELECT COPPER MOUNTAIN DSL SOLUTIONS.
ISDN: Still a viable choice.
Easier, Cheaper DSL: Replacing Central Office Hardware With Access Concentrator Technology.
SUMITOMO SELECTS CENTILLIUM FOR ADSL MODEM CHIPS.

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters