Let the buildout begin

Local exchange carriers, led by the Bell regional holding companies in particular, are not expected to cede the market for Internet-based business services easily. Yet despite their experience in running networks, they still face a formidable network upgrade.

Although the RHCs as a group are grudgingly yielding their local loop, using the legislative and legal process to force continued examination of access charges and universal service questions, what dilutes their argument is the fact that they have done little to prepare for the era of broadband access while competitors have been busy building out. The RHCs now find themselves in the uncomfortable position of being dubbed Internet newbies-even as their networks carry the heavy volumes of end user data traffic that their competitors are now managing and billing.

As a result, the carrier market has opened up to a whole new group of prospective suppliers. Most already have made a name in the user market and are now looking to carriers and service providers as large-scale data networking reaches unprecedented levels in the national and international telephony infrastructure.

One thing is for sure: Gone are the days of complete end-to-end vendor integration. Although Lucent Technologies, Northern Telecom and Siemens Stromberg-Carlson are still important players, even they have admitted they cannot go it alone. These companies have allied on the data access side with Ascend Communications, Shiva and Newbridge Networks, respectively.

But Cisco Systems has done the most to disrupt the relationship between telcos and their once-traditional infrastructure vendors, especially since acquiring StrataCom.

Cisco, which has built data backbone networks for most of the RHCs, has become renowned for its ability to assist carriers in moving into the data world. "We're looking for ways to help create services," says Jon Shantz, vice president of the service provider market at the San Jose-based company. "Traditionally, telcos have been out in the network cloud, but the people [best-suited to get into Internet business] are the service providers. We're actually working with the service providers on dozens of projects.

His message is basic: Make networking as simple as possible for users. When it comes to intranets, for example, the typical business user wants ISDN, a router, e-mail, a Netscape browser and security. "To make it work is a real pain because the customer has to understand so much," says Shantz.

To relieve some of this pain-and help Pacific Bell become a better marketer-Cisco delivers routers and applications software as a "fulfillment package" that Pacific Bell can offer customers. The whole installation process becomes that much simpler.

"Models must change," Shantz emphasizes. "[Telcos] must reinvent the business partnership. It means rapid time to market and the willingness to take risks together [with a customer]. It means making things easier for the customer, and the part that the customer doesn't see has to get smoother.

Lucent also has been cultivating the Internet service provider business. It offers a suite of products ranging from the repackaged Ascend access gateway to servers and intelligent network equipment.

The latter, marketed as the Omni- Access System for Information Services (Oasis), adds telephone functionality for Internet applications, letting users dial and fax by pointing and clicking, and access Web sites via speech recognition or text-to-speech conversion. For the carrier or ISP that implements it, Oasis features a service node, a service management system and a Web server.

"We consider Internet access to be a voice/data networking problem," says Gary Passione, manager of market initiatives at Lucent Technologies. Oasis helps carriers "build a shared services platform," he adds.

Cisco and Lucent are examples of companies that have found success in delivering scalable network solutions for Internet business. But most members of the new vendor crop offer more specialized products. As carriers look to move ahead with plans to develop and expand into end-to-end intranet and extranet services, they have four principal but interrelated aspects to consider: access, security, performance management and quality of service. Many of these vendors offer solutions in these specific areas.

Access Access has two components: technical and geographical. Carriers need to offer speedy, reliable connections to the Internet and users' corporate intranets. In addition, the more widespread the access a carrier offers-from a national and even global standpoint-the more value it adds.

Long-distance carriers, whether through alliance, acquisition or partnership, have been attempting to cover as much of the earth as possible. Certain ISPs, such as UUNet and IBM Global Network, have been aggressive in their international expansion. As regional companies, the RHCs are more confined. Most, including Pacific Bell, have opted to stay within their region for the time being, although some, including Bell Atlantic, are taking the first steps to extend networking beyond their service borders as originally defined.

"You've always got to be careful of generalization, but the large LECs are trying to figure out a way to freeze business customers on a branded Internet service," says Van Cullens, head of Siemens Stromberg-Carlson's Internet business unit. "The issue is how to solve the problem of national access. Pacific Bell has a strong local service-a better grade of service-but national access is still a problem.

Just as critical is the issue of general Internet connectivity. Even discounting cable modems as a consumer device for the time being, a jumble of various access technologies-including ISDN, ADSL and ever-faster modems-are affecting carrier deployment. Add to that the Internet protocol's growing potential to carry voice, and suddenly LECs have strong incentives to move on building out access platforms for data communications and the Internet.

ISDN was such a platform, but at least one telecom executive already believes that time and economics have passed it by. At the corporate office, frame relay or asynchronous transfer mode access have become virtual private network (VPN) options. For the small office/home office market, ISDN was once thought to be a killer application, especially for remote access. Yet now, digital subscriber line technology and high-speed modems such as U.S. Robotics' low-priced 56 kb/s Sportster threaten the once-vaunted 2B+D.

"It's cheaper to put in one more line for data," says Anand Parikh, vice president of marketing and business development for Telco Systems. "There's much more appeal for a high-speed modem than ISDN.

Meanwhile, companies such as Ascend, Bay Networks, General DataComm and 3Com, which recently announced plans to acquire U.S. Robotics, are offering access and gateway equipment that telcos can install in their central offices in order to handle IP traffic.

"ATM and access technologies are the focus. [GDC's access product] Colossas is a framework to package these new technologies," says Tim Smith, director at GDC.

"A lot of customers are looking at frame relay VPNs for IP," adds Keith Mumford, director of ATM product line management at GDC. "We're working with MCI on more effective use of IP.

A great deal of debate about IP centers on its applicability for voice. The Internet Engineering Task Force is charged with the task of building on the protocol. Close to completion is IP version 6 (IP6), which will incorporate the so-called RSVP reservation protocol and that analysts say is more robust for voice.

"IP4 [in use now] is not suitable for voice, but the economies of scale are there today," says Steve Sazegari, an analyst with Ryan Hankin Kent. He points to the amount of international voice traffic using the Internet simply because tariffs are so high for conventional telephony.

Likewise, given the potential quality improvement with IP6, corporate users might begin to migrate voice calls onto their IP networks simply for cost reasons. Should an interexchange carrier or ISP capture the user's intranet VPN traffic, that means it will take this voice traffic with it.

Most vendors, watching their IP sales escalate, see this not so much as a question of if but a question of when, and most are exhorting their LEC customers to get with the IP program.

"IP has won the battle to the desktop," declares Brian Walck, director of multiservice infrastructure business development and strategic planning for Bay Networks' Internet/Telecom Business Group. "There's nothing to stop the Internet from being the network for everybody.

Security The one big issue hovering above the concept of Internet business is security.

"A big question at the corporate level is: Is the [intranet] secure? The answer is yes-but for only the first two to three weeks the network's up," Sazegari quips.

The Internet will never be completely secure, he and others say. But links can be isolated, firewalls erected and sophisticated encryption employed. Much like one's own personal security, it can't be guaranteed 100%, but steps can be taken to substantially minimize the risk to near zero (Table 1).

The real problem has been that when carriers use firewalls and other security measures such as tunneling, network performance has dropped considerably. As the market for intranets and extranets gets more competitive, companies such as Sun Microsystems' SunSoft unit, Check Point Software Technologies Ltd. and Raptor Systems have been designing new ways to boost security without sacrificing throughput.

Check Point's major breakthrough, which has catapulted it to a 40% market share among firewall suppliers, has been its "stateful inspection" technology, available on its flagship Firewall-1 product. The company counts a wide range of carriers and ISPs among its customers, including U S West, WilTel, UUNet, Digex, Netrix, Norway's Telenor and the United Kingdom's Quza.

"ISPs are coming to us," says Asheem Chandna, director of business development for Check Point. "They see this as a value-added service beyond connectivity.

Stateful inspection, Chandna explains, screens all communication attempts into a user's server. The technology checks incoming and outgoing traffic against a series of dynamic "state" tables that contain the security information and policies defined by the user. If it finds any mismatches or discrepancies within incoming packets, it blocks communication before it reaches the server.

The technology is designed to replace application gateways and proxy servers, which offered high security by inserting an extra server between the client and the destination server, thus increasing latency. Most firewall manufacturers have since adopted the stateful inspection technology, Chandna says.

SunSoft is one. It combines a firewall with the other component of network security, encryption.

One of the virtues of SunSoft's product, SunScreen SPF-100, is that it sits in the IP network but has no IP address-a poetic irony that can't go unappreciated by those aware of Sun's vision of a day when virtually every household appliance has its own URL.

"SunScreen has a stealth architecture," says Humphrey Polanen, general manager of Sun's Internet Commerce Group. "If you can't find a point of attack, you can't break through.

In addition to the firewall feature, Sun adds two levels of encryption to SunScreen. At the basic level, Sun incorporates simple key management for Internet protocol (SKIP), a standardized encryption algorithm that Sun developed and the IETF adopted. SKIP provides the basic building block and platform infrastructure for network security. "SKIP creates encryption at the IP layer," says Walter O'Malley, product manager with SunSoft. "Any application on top of that becomes encrypted. It eliminates the need for multiple encryption algorithms in the application-and thus interoperability worries, too.

On top of SKIP, Sun has just added an additional stateful inspection-based encryption server, SunScreen EFS, that lets users set up security policy definitions for groups and allows modular support for a large number of SKIP nodes.

One of the major SunScreen users, according to Polanen, is the Intuit Home Banking Network in Downers Grove, Ill., which is using the equipment in electronic funds transfer and transaction processing applications.

The goal, says Polanen, is to make the security aspects of the network easy and transparent. "E-commerce will take off when people don't have to think about security," he says.

Performance management After security, another big question mark arises over Internet, intranet and extranet business: How can users accurately measure the performance of their Web servers, track e-mail messages and ensure that clients from inside and outside the organization can link up?

Companies are attacking this problem from many directions, and among them are top suppliers such as Lucent, Hewlett-Packard, Sun and Cisco. In addition, software providers such as Microsoft and Lotus Development Corp., as well as professional services organizations such as International Network Services (see sidebar on page 42), have stakes in this area.

In essence, it's all about using the Net to monitor the Net. Lotus, for example, has begun a major drive to boost the awareness and capabilities of intranets and extranets. Last fall the IBM subsidiary introduced Domino, a server designed to extend the facility of its highly successful Notes groupware for business management and communications across the Internet.

Through a series of Lotus Notes Public Network partners, Lotus is actively working to improve the ways carriers can manage end-to-end IP networking with Notes. In December, the company and its carrier affiliates successfully demonstrated guaranteed message delivery via the Internet across four continents, all the while maintaining formatting integrity for e-mail, attachments and forms-based applications. "Each of the participants was able to trace messages all the way," says Mary Murphy, general manager of the telco and ISP market for Lotus. NPN partners include AT&T, Bell Canada, BT, NTT, Telecom Italia and U S West, the only RHC on the list.

Lotus is targeting the top 50 carriers worldwide as potential partners, but Murphy warns that the company knows the value of the program, which gives the partner prime access to IBM and Lotus sales channels, as well as plans to pick and choose.

"It requires a tremendous commitment if you are an NPN partner," she advises. "Size is a factor, but it won't guarantee you as an NPN partner. You can be a big telco but not have a strategy. We also want telcos with a customer focus.

Customer focus means service quality, and this last component runs like a silk thread through topics of access, security and performance management.

Most believe that, in terms of quality and reliability, both carriers and ISPs are still battling for predominance in the minds of customers.

The recent-and by all accounts ongoing-problems with America Online have generally given ISPs a black eye, justified or not. Analysts think it's enough to give chief information officers pause before signing a large contract with an ISP. In the meantime, IXCs and LECs have been touting their reliability records.

"Digex and BBN Planet dream a lot about the business market. To businesses it's about 24 x 7 service. It's about the network," says Biri Singh, senior consultant with Ernst & Young. "The ISPs are going to have to guarantee service and uptime.

"Most [ISPs] recognize they need to develop reliability and trust," says David Mayes, director of product development at Ascend. Yet despite their reputation for quality, he is quick to point out that most carriers aren't moving fast enough to learn about and implement Web search engines and local content development, not to mention help desks.

"The PC help desk is foreign to an AT&T or BellSouth," says Rick Matthews, senior manager at Ernst & Young.

"ISPs have something of an edge because their businesses are driven by the Internet," says Ascend's Mayes.

Recognizing that the world's top companies are embracing new ways of networking and communicating, it's not surprising that most believe culture will have as much to do with a company's success with Internet marketing as its ability to finance, purchase and install technology.

"The most profound changes are happening in businesses you'd think are far removed from high-tech," says William Raduchel, vice president of corporate planning and development and chief information officer at Sun. "The effects are less in the 'gee-whiz' applications and more in the cultural change.

The most forward-looking companies, he says, are realizing their businesses don't just depend on information systems but are information systems. What's more, changes wrought by PCs will seem small compared with those wrought by the Internet and the Web. To Raduchel, PCs just improved the tools businesses have worked with for years. Because it is content-neutral and democratizes information, the Internet "will sweep away all that's gone before."

Nothing, of course, makes a better impression than to show dexterity with the services one sells. That's where International Network Services comes in.

The 6-year-old Sunnyvale, Calif.-based company offers both performance management equipment and on-site professional services. Among its biggest current projects is handling the rollout for data networking systems for the new Hong Kong airport. Telecom customers include MCI, AT&T, Cox Communications, Continental Cablevision, all the Bell regional holding companies except for U S West, and foreign carriers such as BT and France Telecom.

Last August, INS introduced Version 3.0 of its EnterprisePRO network performance management system, adding what it claims is the first Web-based performance management feature. The software was upgraded in December with Release 3.1.

"EnterprisePRO tracks usage and error stats and shows real-time data," says Steve Waldbusser, principal architect for INS' Electronic Services Division. "We've broken into a new area of performance management. Not only that, we're doing it on the Web." Waldbusser, who is also a co-author of the simple network management protocol and author of the remote network monitoring (RMON) and RMON2 protocols, said the equipment is scalable to suit carrier applications.

Carriers can use the Web-based performance management system to monitor customer networks or hand the whole process over to the user. INS even found its own product useful in this regard. Waldbusser recalls that, when testing the product internally, INS found that its frame relay data streams were spiking at half the committed information rate (CIR) it had contracted for. When INS contacted the carrier, the telco discovered it had incorrectly set the wrong CIR.-ST

Even as they confront the new market opportunities created by the growth of the Internet, local exchange carriers must now deal with the shift in calling patterns that Internet use has precipitated.

The models and algorithms used to build the public switched networks were based on average call durations of four to six minutes. Internet service providers, which offer businesses and consumers unlimited access for a baseline price of $19.95 a month, have wreaked havoc with those numbers.

The affect this shift in calling patterns has on the health of the network in still being debated. Yet there is no doubt that in most large markets, including New York, San Francisco, Los Angeles and Chicago, there have been reports of longer waiting times for dial tone and more "fast busies" that signal a circuit overflow. While these network "brownouts" may last just seconds at a time, "they have been long enough to generate complaints," says Jack Kozik, manager of 5ESS system architecture at Lucent Technologies.

Brownouts, most say, will not bring down the network, as some of the more dire forecasts suggest. Yet they are a service problem. Most telcos are responding with solutions that can switch data traffic off the voice matrix as soon as it becomes necessary.

"You want to identify an Internet call as close to the subscriber as possible and route it to a packet-switched or frame relay network," says Jay Hilbert, vice president of solutions marketing for DSC Communications Corp.

DSC, along with Lucent, Northern Telecom, Premisys and others, is attempting to do just that through a mix of switches, access gateways and intelligent network software.

DSC, which markets cross-connect switches, service switching points and service control points, is working on the latter approach. The intelligent network can be used to detect voice or data calls, then switch them quickly to the appropriate network, Hilbert says.

Lucent favors a more direct approach. Its solution uses software to identify long hold-time users and move them to the access interface unit, a modular line unit that provides a virtual non-blocking path through the switch.

A second component of this plan is an additional module for the 5ESS, the SM-2000, that provides up to 30,000 more time slots. It also supports the primary rate ISDN interface and is well-positioned to handle 56 kb/s modems that are hitting the market now, Kozik says.

Nortel has put its own twist on the switching solution by chaining together its AccessNode, Rapport dial-up switch and Magellan Passport ATM switch, which together make up Internet Thruway. The package thus far has attracted one RHC, SBC Communications, which announced a contract with Nortel in January.

In addition to its own switches and terminals, Nortel provides remote access equipment from Shiva and asynchronous transfer mode customer premises equipment from Fore Systems to round out the offering.-ST