IP voice hits its stride: Telecom 99 showcases carrier deployment plans

Barely registering a blip on the radar four years ago, IP telephony was among the latest must-have technologies at Telecom 99 last week in Geneva.

Perhaps no technology had greater representation at the show, as several vendors announced key customer contract wins and architecture changes that will position the technology as one of the most important for the next few years.

But conceivably the most significant news from the show was that GTE Internetworking would launch an international wholesale voice-over-IP service. The service, which uses Cisco Systems' gateways, is believed to be the first by a carrier that also owns a major Internet backbone.

Under the first phase of what is expected to be a three-part plan, GTEI will partner with competitive carriers in foreign markets to terminate minutes coming off the company's global network infrastructure. Last week it announced that Italian carrier Tiscali will be its first international partner. Silicon Valley-based Dialpad.com is GTEI's first domestic partner.

"We're anxious to go after the new operators, and right now the revenue opportunity is in wholesale," said Brian Walsh, senior marketing manager for enhanced IP services for GTEI.

Eventually the company may offer retail service but will likely combine that with other IP voice applications. "It makes perfect sense to slot voice over IP as another offering to our [virtual private network] customers, but the market just isn't there yet," Walsh said, adding that the company is testing some applications internally.

Also aiming at the enhanced-IP-voice-service market is Lucent Technologies, which unveiled an alliance with Networks Telephony. Under terms of the $1 million deal, Networks Telephony will use Lucent's MultiVoice for MAX 6000 gateways to expand its wholesale services. The company has installed 20 gateways and plans to deploy eight more per month across Europe and North America.

The deal marks the completion of a strategic change for Networks Telephony, which has slowed its efforts to attract ISP customers in favor of marketing wholesale services to other carriers. It also puts the company in more direct competition with other wholesalers, including AT&T's Global Clearinghouse and GTEI. However, Networks Telephony said that it will concentrate on smaller carriers who may not be able to get low-cost access from bigger players.

"These new carriers are looking for a very low-cost way of getting into the business," said Flynn Nogueira, director of global marketing for Networks Telephony. "For these big guys to do that you have to have a zillion minutes."

The company will rely on Lucent to help it develop enhanced services over the same platform. "The whole key for us right now is building minutes," Nogueira said.

In other show-related news, Level 3 Communications said it was on track to launch a basic set of wholesale IP-based voice services near the end of this year. The company had been strictly providing data services for application service providers (ASPs), Web-centric companies and competitive local exchange carriers. With its wholesale strategy, the company plans to start offering carriers a service that is on par with the public network.

"This isn't being done to have a voice-over-IP product," said Kevin O'Hara, executive vice president and chief operating officer of Level 3. "It's to have a product that is indistinguishable from the public network."

Further down the road, Level3 will begin rolling out some enhanced voice services over its IP network.

"We think voice itself is an application," he added. "How you enhance voice, we think, is where you get the really interesting applications for ASPs."