Return-Path: Received: by massis.lcs.mit.edu (8.7.4/NSCS-1.0S) id RAA29233; Sun, 16 Nov 1997 17:53:04 -0500 (EST) Date: Sun, 16 Nov 1997 17:53:04 -0500 (EST) From: editor@telecom-digest.org Message-Id: <199711162253.RAA29233@massis.lcs.mit.edu> To: ptownson Subject: TELECOM Digest V17 #317 TELECOM Digest Sun, 16 Nov 97 17:53:00 EST Volume 17 : Issue 317 Inside This Issue: Editor: Patrick A. Townson Re: The Internet Will Swallow the Phone System (Fred R. Goldstein) Re: The Internet Will Swallow the Phone System (John R. Levine) Re: The Internet Will Swallow the Phone System (Lee Winson) Re: The Internet Will Swallow the Phone System (Bruce Lucas) Re: The Internet Will Swallow the Phone System (Eric Edwards) Re: 10XXX/101XXX Codes in Canada (Eric Blondin) Re: Updated GSM-List 11/08/97 (Rishab Aiyer Ghosh) TELECOM Digest is an electronic journal devoted mostly but not exclusively to telecommunications topics. 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Goldstein) Subject: Re: The Internet Will Swallow the Phone System Date: 16 Nov 1997 03:39:13 GMT Organization: GTE Internetworking - BBN Technologies In article , wollman@khavrinen.lcs. mit.edu says... >> The author did not explain how this "capability" will improve. > Pity. That's OK, I can. But the argument is refutable. Indeed, the whole "Internet will swallow" thread seems to me to be amazing hubris amonst those on the Internet side who simply don't understand the complexities of the phone network. Carrying CB-radio-quality voice, or even sunny-weather hi-fi audio across the Internet is (literally) childs' play. It's only a teensy fraction of what the telcos have to worry about, and usually do. I started off on the "voice" side in the '70s, and was Telecom Mgr. here at BBN in the late '70s, doing PBX stuff when the ARPAnet NCC (NOC) was ours, and with my desktop VT-52 connected to host computers via a Pluribus TIP. Now I'm quite conversant on Internet, packet and ATM matters, and speak both languages. I do however see a failure to communicate. > Point 2: Statistical multiplexing, which arises out of the observation > that not everybody wants to talk at once, applies to data networks ... Of course. It's natural there. > Point 3: There are essentially three types of data services: elastic, > adaptive, and isochronous. Elastic services are insensitive to > short-term delays in the network ... > Isochronous services are at the exact opposite end of the spectrum: > they depend on traffic reliably getting through the network at a > constant rate, with packets arriving neither too soon nor too late. > For a very long time, telephony-type applications were thought to fall > into this category, but it's now understood by networking researchers > that they are, in actuality, adaptive services, the third major type. ... > An adaptive service is one which can operate under widely differing > network conditions, and provides some amount of buffering at the > receiving end which can be adjusted to provide as good a service as > the delays in the network allow. The prototypical ``Internet > Telephony'' application, Van Jacobson's research vehicle `vat', was > the first major application to develop this service model. Ah yes, the Nineteenth Coming of Etherphone! Indeed the idea that voice is elastic is not new. Undersea cables in the '70s used it to conserve costly (analog!) channels. Voice was stored in little bursts. Silent bursts were discarded and good ones were shoved onto available channels, preceded by tone bursts (to identify the original channel). I went to work at DEC in 1980 just as they were installing a TASI system, STC's COM-II, which could compress 31 channels onto 16, all analog tie lines. I think its packet size was 39 milliseconds. It was supposed to save money, but in practice it was a horror show. Then in 1986, StrataCom brought out their digital TASI, the IPX, which used somewhat shorter packets and was somewhat less horrible, but not without pain. All in the meantime, the REAL cost of bandwidth was plummeting. In 1980, a domestic US toll call probably cost Mother (AT&T Long Lines) about 15c/minute (call it my educated guess), exclusive of the share paid via Separations to the BOCs. Then the glass began to go in. Nowadays, after some inflation to devalue the cent, the call probably costs more like two cents. The Dime Lady costs more? She's still paying a nickel or more per minute to the LECs at each end of the call. Big users connect directly to their IXC and don't pay the "originating" half, and "virtual private network" calls with no Bell switches involved are routinely sold at well under a nickel a minute, depending on volume. It's pretty hard to shave much off of two cents. So why does Internet telephony look so good? Because nobody sees the two cents. They see the retail price, which includes billing, marketing (you think the Dime Lady works cheap?), and huge "access" charge payments to the local telcos. It's cutthroat and not very profitable, but very little of the cost is for bandwidth. Internet Telephony bypasses the billing system, so it looks cheap. Legally (in the USA), IF you carry voice across state lines and feed it INTO the local exchange (NOT into an ISP as a packet stream but as a pure voice call into the LEC), then you ARE a long distance carrier. Sticking a Cisco router in the middle and running newfangled forms of TASI doesn't change things. If you only use the local exchange to call up an ISP as a data call, then of course the per-minute access charges do NOT apply, and that leaves Internet telephony a big niche market for recreational chatting amongst computer hackers. But if it rings a real phone line, Long Distance is Long Distance. And frankly over the past 20 years the quality of LD has improved astonishingly. A call from Boston to New York in 1977 was hissy at best, that "Long Distance" sound, and transcontinental calls were half-duplex too due to echo suppressors. Today a call between the USA and Australia sounds almost local. Internet telephony, with its long packetization delays and low-bit-rate voice, with its dropouts and "adaptive" (that's a euphemism) quality, harkens back to the bad old days. Sure, an LD company could offer it, but why, when fiber optic 64000 bps channels are cheap enough? > Point 4: These three types of services interact in an interesting > way. Specifically, services which inject their data into the network > at a constant rate, or effectively so, will always win a battle for > bandwidth against elastic services like TCP. This has two salutary > benefits: first, and most immediately, people will actually be able to > use the service, at least so long as the network isn't totally > saturated. That's salutary in the Swiftian "modest proposal" way. Translated: Voice is anti-social and drives data off of the Internet. TCP follows the Van Jacobson Slow-Start and backoff rules (if it conforms to spec). Voice-on-net doesn't. That's why VON is worse for the Internet itself than it is for the telephone industry! I'm concerned that too much VON will degrade the Internet's data performance, causing too much congestion. The phone companies will fend for themselves. Or at least the smart ones will -- telcos who cry that the Internet are "ruining" the phone network are missing the boat too. (ooooh, the temptation to say "Bell Titanic" here is too great, but I will try to resist that mixed metaphor ...) > Second, in the long run, users will eventually notice that > their network performance is getting sluggish, at which point some > fraction of them will purchase a higher level of service, again > providing an additional economic incentive to expand the capacity of > the network. By which point, data is clobbered, and doesn't have the option of just picking up a normal phone! Voice-on-net is a cute hack. It's potentially useful for "intranets" where there is private bandwidth, and for some discount long-distance services (especially overseas), where its low bit rates might be economical compared to the older gear telcos use. But a well-engineered circuit-switched telephone network is a thing of beauty, not much appreciated by many Internet wonks but beloved of millions of subscribers. That market's not about to disappear. Fred R. Goldstein k1io fgoldstein"at" bbn.com +1 617 873 3850 Opinions are mine alone; sharing requires permission. ------------------------------ Date: 15 Nov 1997 04:56:43 -0000 From: johnl@iecc.com (John R. Levine) Subject: Re: The Internet Will Swallow the Phone System Organization: I.E.C.C., Trumansburg, N.Y. Before we write off the telcos in favor of the Internet, can we meditate on the topic of access charges for a minute? Every long distance carrier (IXC) in the U.S. pays a substantial amount of its revenue, like about half, to LECs in the form of access charges, typically two to three cents per minute per end of each call. Internet providers (ISPs) don't pay that fee. Both the 1987 "modem tax" brouhaha and some skirmishes earlier this year were on the exact issue of charging ISPs the same per-minute fees that IXCs pay. Both in 1987 and 1997, the regulators decided that ISPs don't need to pay because they're not in the long distance business, they're in the Internet business. But if Internet telephony ever becomes more than a gimmick, this will change, and ISPs will pay the same amount that IXCs do. (The amount charged to IXCs is in fact dropping, but what's important is that they'll be equal.) Given a choice between paying 10 cents a minute for phone calls versus all you can stand for $20/month, the ISP looks pretty attractive. But equalize the access charges to, say, 1 cent/min per end, and the IXC will charge about 5 cents/minute, while the ISP will charge $20/mo plus 2 cents/minute. You'd have to make 11 hours of Internet phone calls per month before you come out ahead, and for the forseeable future, Internet telephony will sound a lot worse than real phone calls. (As someone else noted, telcos are hidebound but not totally stupid, and they can packet switch phone calls just like ISPs do if that's an effective way to get the connections they need, which will make the costs of providing similar service from the ISP or IXC about the same.) I certainly agree that telcos will have to be dragged kicking and screaming into the 21st century, and the ones who insist that they're only in the business of providing circuit switched connections over copper pairs for large per-minute charges will probably die. But it's way premature to think that Internet telephony will take away their market, since the cost advantage is due largely to a regulatory quirk. One thing that Internet phone does tell us is that there's a market for inferior phone service at a lower price than for high quality phone service, but it doesn't tell us what the most effective way to provide that lower level service is. John R. Levine, IECC, POB 640 Trumansburg NY 14886 +1 607 387 6869 johnl@iecc.com, Village Trustee and Sewer Commissioner, http://iecc.com/johnl, Finger for PGP key, f'print = 3A 5B D0 3F D9 A0 6A A4 2D AC 1E 9E A6 36 A3 47 ------------------------------ From: lwinson@bbs.cpcn.com (Lee Winson) Subject: Re: The Internet Will Swallow the Phone System Date: 16 Nov 1997 02:30:39 GMT Organization: The PACSIBM SIG BBS Some more comments on economic competition and telephone service ... Someone said the cable TV companies have already dug up the streets and put in a "local loop" plant. Well, yes and no. Yes, we have cable TV service and a lot of people have fiber optic. But is the existing plant INDIVIUALLY ADDRESSABLE for two-way conversations? My local cable is but one "pipe" emanating from their HQ. Can that handle the equivalent of 120,000 lines PLUS all the private and high speed data links the phone company has in this area? Further, cable lines are installed with a lower physical standard and are less reliable than phone lines. > The BOC's loop is one way for consumers and businesses to connect to > their ISPs, but there are others: wireless and microwave, for > instance, are in use today. Is wireless and microwave appropriate and cheap enough for individual POTS subscribers? > That's certainly one opinion. Others feel that telephone customers > have had no choice in where their money went prior to today, and the > dollars they have invested in telephone service (because all dollars > are ultimately supplied by the customers) is a "public investment" in > a private company. Consumers received a service for their payments all this years. The network was not built by tax dollars, but rather by subscribers who were getting telephone service. Indeed, the smallest subscribers were subsidized by the heavier business, premium service, and long distance users. > When GM came to town, Ford could argue that the existing roads should be > used exclusively for Fords, since only Fords had been used on them up > to now. Should GM build all new roads? Well, your argument falls flat since Ford didn't build the roads in your story. The Bell System designed and built the network privately. It also must be remembered that Bell System stockholders gave up many rights that a private company normally has. They could not get rich the way Microsoft and Intel stockholders are. The rate of return was sharply limited by state PUCs and the FCC. Further, the pricing of service was controlled by the government. The phone company is also mandated to serve unprofitable/undesirable customers. There are often articles in the newspaper complaining about corporations avoiding poor or ghetto areas, however, that is generally fully legal. The phone company must offer full services everywhere, to everyone, with appeal rights to the PUC. And that is costly. The phone company isn't allowed to tack on price premiums. For example, if you visit a resort town, you'll find most prices more expensive than back at home. Phone service will be exactly the same. If the phone company was private, it'd charge a premium just as the ice cream man and suntan lotion store. [I paid double for suntan lotion this summer at the beach because I forgot the bottle at home.] > A key point that investors look at in determining whether or not to > fund a startup. Not many people are wealthy enough to start their own > phone company, so if the experience running a network isn't there, > neither will the funds be there. That's exactly the value of a market > driven economy - better ideas drive out poor ones. While the above is generally true, there are two very important exceptions that people forget about: First, investors are by no means always shewd and rational. There are empty brand new shopping centers near me. The investors who built them lost money. I never understood why they were built in the first place as I saw no retail demand for that location. Someone obviously convinced investors otherwise. You're gonna see plenty of startups fail. Secondly, better ideas don't always "drive out bad ones". That only happens in the "pure competition" economic model where everyone has full knowledge and equal opportunity to enter the marketplace. Once a company gets entrenched, it won't be go away so easily, even if it provides _bad service_. It boils down to _service_. Someone else posted that our expectations have dropped to service quality. I agree, quite regretfully. From my own perspective, I could care less if someone invests and makes a killing or loses his shirt in the telephone service business. What I fear is, as a consumer, being stuck and dependent on lousy service because a variety of marketplace conditions dumped that on me. I don't want to get fleeced paying high rates as I'm forced to at COCOTS or to use cellular as a substitute. Telephone service is a critical public utility. Years and years ago society recognized its value and destructiveness of competitition in this particular industry and established sensible controls. Competition IS the American Way. But I don't see the evolving industry as competition in the sense of a Norman Rockwell painting. Rather, I see it as the Trusts and new unfettered monopolies that Pres Theo. Roosevelt had to break up. Why re-create something we know from history was a failure? ------------------------------ From: Bruce Lucas Subject: Re: The Internet Will Swallow the Phone System Date: Sat, 15 Nov 1997 23:38:48 -0500 Garrett Wollman wrote: > (This actually provides sort of a ``poor man's > admission control'' -- once the quality degrades past the level of > acceptability, people will become discouraged and stop, thus removing > their traffic from the network.) Yeah, that really sounds like my idea of high-quality phone service - hovering on borderline of acceptability, with a guarantee that some percentage of the time you pick up the phone get such a poor connection that you just hang up instead. Yeah. ------------------------------ From: ese002@news9.exile.org (Eric Edwards) Subject: Re: The Internet Will Swallow the Phone System Date: 16 Nov 1997 09:33:42 GMT Organization: Engineers in Exile On Fri, 14 Nov 1997 15:24:10 PST, Craig Milo Rogers wrote: > No, but that's not the right analogy. :-) Instead, consider a > "typical" small-town shopping area: narrow streets, small stores, > needless exposure to the weather while shopping, high city taxes to > support crumbling infrastructures. Suddenly, a Net*Mart appears just > outside the town boundaries. Good parking, wide selection, air > conditioning, no city taxes ... that's the brave new world we're > building! So competive local carriers encourage the electronic equivilient of urban sprawl. Hmmm. I'll have to think about that one ... ------------------------------ Date: Fri, 14 Nov 1997 13:37:50 -0500 From: Eric Blondin Subject: Re: 10XXX/101XXX Codes in Canada miind@hotmail.cam (Sebastien Kingsley) wrote: > Ok, first of all, I KNOW what a PIC (primary interstate carrier) code > is (10xxx/101xxx), and what they are used for, but my question is, how > are they used in Canada? > The reason I ask this is because it was my understanding that they > WEREN'T used in Canada. > But, I recently obtained a document from Industry Canada, that > contains PIC codes for many Canadian RBOCs and other long distance > carriers. > Here are a few of them: > BC Tel - 10323 > Bell Canada - 10363 > Fonorola - 10507 > London Telecom - 10960 Yes those codes are used in Canada, a bit differently (and limited) compared to the U.S. though. First of all, I`ll take Fonorola as an example: a new customer subscribes to the service, so the number is entered in the switch, afterward the number is PICed, this takes a few days, so the customer is told that if they want to use our service right away, he must use the 10507 CIC for a few days until service is setup on equal access. Another use would be for customers who would like to be on casual calling (not all carriers offer this though) and for this to work they would need to have opened an account with us (except for a few like PRONTO (I think that's the name) who offers service in the Montreal area and offers only casual calling, which is billed by Bell Canada at PRONTO rates). Finally, I know that our Cust. Serv. Reps give the 10323 CIC to our customers when we have connection problems to certain countries and STENTOR seems to work and the call is really urgent (10323 IS assigned to BC Tel, but works from all over the STENTOR networks). Of what I heard, those codes work from payphones in the U.S., they don`t in Canada though (at least for now). Hope that`s precise enough. Eric Blondin The International Dialing Resource Center: http://www.geocities.com/~dialworld ------------------------------ From: Rishab Aiyer Ghosh Subject: Re: Updated GSM-List 11/08/97 Date: Sat, 15 Nov 1997 05:06:14 +-5-30 Dear Jurgen, I'll try and post a list of Indian GSM cellular operators' contact numbers soon, but for the moment here are the correct numbers for the two operators in Delhi. Jurgen Morhofer wrote: > India Airtel 404 10 Int + 91 10 012345 > Essar 404 11 Int + 91 11 098110 Airtel Int + 91 9810 012345 Essar Int + 91 9811 098110 FYI India has more GSM ops than any other country in the world, and has therefore become the only country with a GSM MoU Interest Group of its own (instead of being part of GSM-MoU's Asia Regional Interest Group). India will shortly become the world's only country to hit a million mobile subscribers within 30 months from the start of service (currently it's approx. 700,000, growing at >280% p.a; the first GSM network here started in end-1995). -rishab The Indian Techonomist - http://dxm.org/techonomist/news/ The newsletter on India's information markets Editor and Publisher - Rishab Aiyer Ghosh (rishab@techonomist.dxm.org) Mobile +91 11 98110 14574; Fax +91 11 2209608; Tel +91 11 2454717 A4/204 Ekta Apts., 9 Indraprastha Extn, New Delhi 110092 INDIA ------------------------------ End of TELECOM Digest V17 #317 ******************************