Making ATM sing

Telecom industry trends generally begin to be legitimized when big things start to happen. Early signs of an important trend in data networking intelligence are occurring more often, including the recent formation of TeraBridge Technologies.

TeraBridge is a joint venture between Newbridge Networks and TeleHub Communications with the goal of adding a new layer of service creation, control and management capabilities to asynchronous transfer mode networks.

"The data services world is the same as the voice world: You want to set up a call and make sure it has the bandwidth and quality of service you require," said John Strand, former president of TeleHub Technologies and newly appointed president and chief operating officer of TeraBridge. "What does that? Off-board control-and that's what we're building for a data network."

The company's underlying technology creation is Virtual Access Services Platform. The commercial version of VASP, PathMinder, was created by the TeleHub Technologies division that has become TeraBridge under the joint venture.

The PathMinder software platform was originally conceived to provide the same quality and reliability of traditional circuit-switched voice networks to voice-over-ATM networks. Now, the architecture is being expanded to provide the same kind of provisioning and management functionality to ATM networks powering integrated services.

As for that other oft-cited data networking platform-Internet protocol-TeraBridge views IP's place in the new network scheme as an applications protocol that will work in tandem with ATM.

"The transport part is ATM because it can guarantee quality of service and manage your bandwidth," Strand said. "You continue to push IP out to the access network."

Newbridge got involved to enhance its existing position in the ATM switch market. "They had the switch, but they didn't have the software to add the features," Strand said. "There was more of an engineering meld at the time than a business meld."

Adding software capabilities like the ones TeleHub has developed is a way to turn an ATM switch from a piece of hardware into a service platform, Strand said. "It's not just a switch, it's a new generation of services," he said. "It's more complete."

For TeleHub, the opportunity to link with Newbridge created more exposure for its invention. "The way we looked at it was here was a major ATM switch vendor that owns 26% of the market that has the opportunity to get our software out," Strand said.

VASP has already been put through its paces at another TeleHub subsidiary, TeleHub Network Services, a network operator that primarily provides connectivity to switchless resellers and other competitive service providers.

"We decided the only thing to do was to build our own network to show off our software and what we could do," said Don Sledge, vice chairman, president and CEO of TeleHub Communications.

TeleHub wasn't interested in being a subsidiary of Newbridge because that would be too limiting. TeraBridge's aim is to sell the software platform to multiple ATM switch suppliers and carriers independently, not to be locked into a single vendor. Financial issues were also a major consideration.

"We did not want to give up the upside-the ability to take it public," Sledge said.

Brian Jervis, executive vice president of Newbridge, becomes chairman of TeraBridge, and seats on the company's board are split evenly between TeleHub Communications and Newbridge.

For both companies, the appeal of the alliance is in being first to market and thus getting a jump on the carrier approach.

"As long as we can maintain our head start, we'll continue to lead the industry-especially starting with a 26% market share," Strand said.

TeraBridge has simple goals: go public within 18 months and establish itself as a software leader for call control software, supplying to all the major ATM switch manufacturers.

"Eventually we become sort of the de facto standard for call control software," said Strand.

* TMN COSTS Insight Research's "TMN: The Standard, The Practice, The Markets 1999-2004" reveals that carriers often consider TMN standards too expensive to build. However, TMN applications continue to gain revenue. According to the study, worldwide sales revenue associated with TMN applications reached nearly $1.95 billion in 1998 and will increase at an annual rate of 21% to top $5.06 billion by 2003.

* EXODUS EXPANDS Looking to extend its managed services offerings, Exodus Communications acquired Cohesive Tech Solutions, which specializes in networking, Web applications and technology solutions, for $100 million. Exodus also introduced two programs for ISPs: Internet data center co-location services and wholesale access services.