Mountains out of molehills

Frame relay services using switched virtual circuits have long been on some carriers' product development radar screens. However, it seems that carriers have not been able to meet their target delivery dates. Instead of quoting availability in quarters, it's not unusual for a carrier to quote halves or even entire years.

The delay in SVC commercialization and the air of conservatism among carriers can be partly attributed to the lack of customer premises and central office equipment support, the lack of understanding of SVC applications, and billing issues. Although these issues are clearly not easy hurdles to overcome, they're not as insurmountable as some carriers make it appear.

The days of blaming delays on equipment vendors may be numbered. There are about a dozen CPE and CO equipment vendors that currently support SVCs or have announced support for SVCs soon. Even if your core frame relay switches do not support SVCs, there are edge switches like Hughes Network Systems' IX platform that will allow you to tunnel SVCs through PVC trunks.

Some vendors even offer enhanced SVC capabilities like quality of service, encryption and compression.

Another common excuse is that there is little market demand for SVCs. But SVC capability is one of those features that may need to create its own market.

The carriers had to educate customers about the applications and the benefits of the service. But some carriers are having difficulty coming up with the applications for SVCs. Here are some ideas to get you started.

SVCs can be highly effective for remote site interconnectivity to support highly intermittent applications such as conferencing or voice calls, connections from a company's intranet to the Internet, overflow traffic during busy periods, and interenterprise connectivity. Interenterprise connections, sometimes referred to as "extranets," connect multiple intranets or communities of interest.

Star networks are common in today's frame relay networks where remote sites are connected to the headquarters site to conduct critical business functions. However, some customers cannot cost-justify PVCs for remote-to-remote non-critical communications.

The result is that many companies maintain their star configurations to reduce complexity and save money by tandeming remote-to-remote traffic through a central location. This can eventually result in poor network performance for all users.

Worse yet, the amount of traffic on the network increases but the carrier does not get any additional revenues.

Herein lies the biggest carrier benefits of offering SVCs. Incremental revenues can be achieved by providing a cost-effective SVC solution for remote-to-remote or overflow traffic.

Furthermore, customers can realize better network performance by reserving PVCs for critical applications and by providing direct SVC connectivity between remotes.

Other stumbling blocks carriers cite are the billing systems' inability to support usage-based billing effectively and the switches' inadequate usage reporting functions.

Actually, switch manufacturers have come a long way in providing usage reports. Some have even developed application programming interfaces (APIs) for the carrier's provisioning and billing systems. These APIs feed standard sets of formatted usage information to the billing system.

The billing system can then use this information to generate an invoice. But then, some carriers still have billing systems that were not designed for usage pricing structures, particularly those using private line systems jury-rigged to support broadband services.

A short-term solution may be to offer flat-rate SVC services until the billing systems are enhanced or modified.

What is the status of frame relay SVC services today? Only a handful of carriers plan to offer SVCs in 1997, most likely in the second half. Considering that the first frame relay SVC service may be around the corner, it might be worthwhile to evaluate if and when you will launch an SVC service and to evaluate your competitive strategy.

Liza Henderson is a Broadband Consultant with TeleChoice, Verona, N.J. Her e-mail address is lhenderson@telechoice.com.