TELECOMMUNICATIONS - PAST PRESENT & FUTURE

This is an interesting article to write, and, hopefully, a few will enjoy reading it too. It is interesting because the past present and future are all coexisting on the planet right now. Shortly I will be discussing a communications technology that may not have great impact until two to three years from now - yet many companies as well as individuals are already finding it useful. At the same time, 50% of the world's population has never even used a phone and 80% do not have a telephone.

THE PAST

Most of the world's population is living in what most of us would call the past. The Commerce Department did a statistical analysis of the world's population and normalized it to a group of 100 individuals. If these 100 people were the world's total population then:

• 51 are female, 49 male
  
• 70 are nonwhite, 30 white
  
• 50 have used a telephone at least once
  
• 50 live more than two hours travel time to the nearest telephone
  
• 70 are illiterate
  
• 80 live in substandard housing
  
• NONE would own a computer
  

Now if you wonder what the market for computers and telephony is, these statistics tell you that the revolution has hardly begun.


THE PRESENT

94% of the US households have a telephone, but, we are bettered by Canada's rate of 97%. 20 million+ adults in the US have 'access' to the Internet. Access, however, may not be in their home. More computers have been sold in the US than television sets, starting in 1995. Like television sets, second computers are now becoming a real "need" adding to the sales volume (along with old system obsolescence). Moreover, one of the reasons for the explosive growth in new area codes is the demand for more telephones in the home. Children, and pagers probably play the biggest role, but, computer access is also critical.

What are we doing with the computers & the telephones? E-mail is the current largest individual use of computers on the Internet. Games, research - recipes, gardening, homework and exploring currently play a large part of the home use. Entertainment is, however, growing rapidly with:

• Real-time, live, concerts from all over the world
  
• Music videos and clips
  

These video services are developing/forcing demand for higher bandwidths to the home. ISDN() (128 Kbps) sales have skyrocketed and the next technology ADSL (1-5 Mbps) is just starting through initial trials.

The interesting result of this Internet phenomenon is that each home who connects to the Internet is having TCP/IP installed, as a byproduct. Like telephony standards, TCP/IP, allows very different systems to communicate. TCP/IP was specifically developed, with federal government funding, to allow all of the disparate computers, installed by colleges, universities and the government to have a common 'language'. The benefits of the common language have anchored the exponential growth of Internet.

• Why send a fax, when you can e-mail the actual document at a fraction of the cost and without labor?
  
• Why send program diskettes when the latest code can be made permanently available on the "Net"?
  
• Business Week, Consumer Reports, Backpacker - they are all 'on-line' and searchable for just the information that you want. Are libraries obsolete? No! They are going on-line.
  
• Want to call your friend in Europe or Asia? You can use the phone or call for free over the Net.
  
• If you can phone, why not video? Yes, and that brings us to the future: IP - the standard.
  

THE FUTURE

In addition to TCP/IP, other standards for voice and video communications have been in place for a few years. With Internet access, and inexpensive software (some free) consumers are moving ahead of commercial entities in the use of technology. Consumers have no investment in old systems and technology. As a result they are rapidly adopting advanced technologies that are wrapped in consumer appropriate packaging. VocalTec, RealAudio, and CuSeeMe packages all offer examples of inexpensive, if not free, audio and video communications programs aimed at the consumer. Moreover, With the cost of distribution being next to nothing, Internet based companies often provide consumer grade software for free and charge only for the full versions of their product. Consider a potential example, closer to (my) home:

My wife calls her mother (1000 miles away) on a regular basis. She enjoys it, but it is not anything like being with her. Some opportunities exist to improve her experience:

With a minor investment for her mother's house we could install a multimedia computer, and, she could share my Internet account at no additional cost. She is already comfortable using our computer when she visits here. - She is over 80, by the way.

Residential ISDN costs only slightly more that two regular telephone lines, but, would allow my wife to call her mother, with high quality, via the Internet, and remain on the phone all day for no charge. She could also connect a video call at 64 Kbps for NO charge or a 128 Kbps call for an extra $1.00 per hour at each end. If my mother-in-law lived in England or Australia, the cost for us would be no different. Her cost would be for local access - but - NO added costs for the international connection.

Hi-tech consumers and companies are starting to take advantage of this revolutionary idea - almost free telephone and video conferencing. The video quality is currently something only a family or a controller can put up with. The quality, however, is only limited by the bandwidth. 3 ISDN lines, or 384 Kbps are currently a standard for basic group teleconferencing for corporations using VTEL and PictureTel systems. These systems are costly to use because they require "telephone calls" to make the connections - not the Internet. They are adopting their products to include TCP/IP support so soon their connections will be much cheaper. At the same time, ADSL will remove access bandwidth as an issue. In other words both consumer and commercial markets are converging for those who are ready to move with the opportunity.

Convergence - Hmm, lets talk about those 80 people who do not have a telephone. The third world is bypassing our last 100 years of telecommunications development, just as consumers are bypassing old corporate technologies. Telephones are being installed without the need for costly wires - cellular is in. Cellular is allowing rapid development in 3rd world countries. One tower can connect hundreds of people with the turn of a switch. More importantly, it fosters fast installation in countries where a telephone may currently take a year or more to install. The systems will also provide an immediate leapfrog into the future for those who can use the capability. Wireless allows full digital deployment - visualize mud huts with Laptops and video conferencing.

For the business traveler, a world wide cellular system using 'LEO' satellites will be operational around the end of this year. At least three countries are installing systems to support this "global Satellite Messaging" (GSM) technology. The mud huts are getting local towers while the business traveler is getting a satellite based system that will allow voice (world-wide cellular access) and data communications (using CDPD modem technology through small cards inserted into the laptop.) The GSM system will allow voice/data communications in almost any geographic area of the world.

Enough rambling, where are we going? The IP communications protocol used by PC's as well as corporate computers is going to allow anyone to communicate via voice, data and video any where in the world at affordable prices - for that part of the world. Those that need mobility, will have universal service availability, uncontrolled by any one government's whims, wherever they travel. The 'world-universal' GSM service costs on the order of an "AirPhone" call, but, that is cheap to those who need the service.

(We're going to get technical here) - The major US Carriers as well as those in many other countries are moving all of their network backbone technology to ATM. Telephone system manufacturers are also adding that capability. By moving all communications, including voice service to packet transmission, the world is being moved to a single unified transmission scheme from end to end. TCP/IP, which resides in a layer 'above' that of network backbone communications (read ATM) is perfectly suited to utilize this advance to meld its voice, data, and video support with the fully packetized network of the future.

(Non-technical) - You will be able to make a telephone/ data/ video call to another party. Each type of information will travel separately, but, at the same time to the party that you call. At his/her end, the system answering the 'call' will connect whatever service it is both capable of and also 'allowed' by the receiver. Remember, the MCI lady does not want video conferencing at home ("she still hasn't showered" ;-), but she does require voice and "datasharing" for her meeting participation.

1. When will all this happen - My mother-in-law could do it now.
   
2. Will it be a guest service - Yes, with equipment and 'philosophical' upgrades.
   
3. When will impact competitive positioning - 10 to 15 Internet years which is about 3 human years.
   
4. What actions to take - Keep your eyes open, try it out yourself, and make sure you contribute to the FF&E budget every year for telecommunications & network upgrade requirements.