Network consolidation:

It's no secret that the telecommunications industry is in a state of flux. Mergers and acquisitions within the vendor and carrier communities make headlines regularly. Some carriers also are taking this time of change to do a different type of consolidation, mapping out plans to integrate their separate data networks onto a single network to ease administrative burdens and costs.

Although the consolidation is expected to prove economical in the long run, the process will be a time-consuming, technical challenge for carriers betting the bank on the reliability and robustness of asynchronous transfer mode technology.

Many telecom service providers have taken steps toward supporting a high-speed backbone by choosing ATM switches and installing Sonet throughout their networks. But the process of integrating separate networks to include protocols such as frame relay, ATM, switched multimegabit data service (SMDS), X.25 and Internet Protocol (IP) onto a single network with a powerful ATM backbone will be an all-encompassing task.

Because data network integration is a work in progress for traditional telecom companies, they might be able to learn a few things from their new rivals, the competitive access providers (CAPs). MFS Datanet, for example, has been providing all of its services off its ATM backbone network since 1992, and Teleport Communications Group has also aggressively deployed ATM backbones throughout its service areas. MFS' initial mission was to connect Ethernet and token ring local area networks. Today, MFS has extended its services beyond LANs into traditional data and voice services. The company was driven toward ATM technology by its entrepreneurial nature.

"MFS is not the typical telephony company," says Jay Jonekait, vice president of business development at MFS Datanet. "That was our objective.

"The only technology that meets the economic needs for our customers is ATM," he says. "[Fiber distributed data interface technology] wouldn't scale, SMDS was a fantasy and dedicated DS-3s were a joke."

MFS has an extensive fiber network that includes a large deployment of Sonet. In situations where it can't build its own Sonet networks, the CAP leases space from other carriers. MFS is using General DataComm's Apex ATM switches in its backbone in addition to several other vendors' services and edge ATM switches.

"We are already doing what everyone else is talking about," Jonekait says. "ATM is a powerful tool. It lets us get some economies of scale, giving us a very comfortable advantage, but ATM is still immature as a technology."

MFS does not depend entirely on the ATM standards that promote interoperability between multiple vendor switches. Currently, it uses the same products at both ends of the network to perform the necessary protocol conversions depending on the service that is being provided.

Although MFS might have a leg up on some of its competitors, managing this fairly new type of network has not been easy. MFS is on its fourth and fifth generation ATM switches, and it has had many management hurdles to overcome. "Management is a very big issue for us," Jonekait says.

To deliver the desired quality of service, the company had to develop some management tools of its own in addition to those offered by the vendors. MFS is continuing to work out the kinks in this ongoing process. Managing an ATM network "is very difficult, and this is why we say, 'Don't try this at home,'" Jonekait cautions.

MFS is swimming swiftly with the ATM tide, as is its fellow CAP, TCG, which has also invested in the high-speed technology but uses more cautious strokes. TCG, while having aggressively migrated some of its services onto an ATM backbone, has yet to bet the farm on the technology.

Last year the company started building its ATM backbone using Cisco Systems' LightStream 2020, and three months later it added Fore Systems' ASX 1000 ATM switches to the mix. Today, less than 10 of TCG's markets are without ATM networks, says Roy Rosner, vice president and general manager for the private line and data services business unit at TCG.

TCG's ATM backbone network supports a variety of data and virtual LAN services such as frame relay, native ATM, Ethernet, token ring and FDDI, in addition to constant-bit-rate T-1 voice services, Rosner says.

TCG's other network sites are running traditional time division multiplexing (TDM) networks for private-line and switching services. "ATM has not reached the point where it replaces TDM," Rosner says. "It is a long way away from eliminating TDM."

To support the variety of services TCG is running off of its ATM network, the company uses SNMP- and HP OpenView-compliant management systems, Rosner says.

Lingering Skepticism Like MFS and TCG, service providers have invested in the notion that ATM is the technology of choice, but skepticism is at the forefront of many carriers minds.

"Carriers assume ATM will bring economies of scale, allowing them to dynamically allocate their network capacity and treat each application as needed," says Christine Heckart, director of broadband consulting at TeleChoice, Verona, N.J.

But, Heckart says, carriers' network experience has not been in integration. Today, each service has its own network, sometimes with subnetworks and its own network operating center, which means a lot of redundancy for some carriers, she says.

"Carriers are still learning how to support multiservice, multiclient ATM networks," she adds. "With the increase in the competitive nature of the telecommunications arena, carriers are looking for ways to remain competitive."

AT&T introduced its frame relay-to-ATM interworking service late last year. The service allows customers to support both frame relay and ATM services at various sites and is based on an ATM backbone. According to Ron Toth, Interspan ATM product manager at AT&T, approximately six customers are using the service right now.

Although the number of customers is small, any experience carriers get at supporting multiservice networks will help the integration process in the long run, industry analysts say.

"Carriers need to investigate how to optimally set the quality of service parameters within each class of service," Heckart says. And the management issue is a big one, she adds. Although the process of integrating these services into an all-encompassing ATM network is under way, the industry will most likely not see anything happen this year, Heckart says-maybe next year. "Carriers are getting some good experience managing ATM-only networks and frame relay-over-ATM interworking," she says.

AT&T's Interspan frame relay and ATM services are among a few in today's market that support two services off a single ATM backbone.

"Interworking is one of the biggest drivers for ATM today," AT&T's Toth emphasizes.

In addition to supporting other, still-unannounced services, AT&T also plans to migrate all of its private-line services onto its ATM backbone, Toth says.

AT&T, like its competitors, is deploying Sonet rings throughout its network to support the ATM network overlays. Sprint, MCI, LDDS WorldCom and most of the Bell regional holding companies are also making similar installations in varying degrees.

"Sprint will spend over $600 million for Sonet [technology] over the next three years, but we expect to see the economic efficiencies where we could recoup that $600 million," says Dominick DeAngelo, vice president of data product management at Sprint. "It behooves Sprint to move toward integration." Sprint has been aggressively deploying Sonet rings throughout the country since last year and expects to have 35 rings up by this July, DeAngelo points out.

Sonet is of key importance to carriers' plans for data services over an ATM backbone because, as analysts point out, it is essential for the transport mechanism, or physical layer, to operate at a higher speed than the actual service.

Sprint, for example, has already picked NEC 20 and Northern Telecom Vector ATM switches for its integrated ATM-based data network. Sprint's data network migration is expected to begin in mid- to late 1997.

All carriers agree that it is an economical move to operate several services off a single backbone. Although the initial investment is expected to be quite large, economies of scale will provide carriers with lower operational costs in the long run.

"Integration offers an economical driver with less floor space and less people to manage the many networks because we will only have one," DeAngelo says.

Sprint plans frame relay, X.25, video and IP servers and switches around its ATM core that will act more or less like edge servers, he adds.

The Management Issue Carriers need to develop management systems that are protocol-intelligent, and this is a significant task, DeAngelo says. "Management is critical. It will take a bit of in-house development combined with systems that are already out there today."

"Of [the big] three IXCs, Sprint has the broadest, most compelling picture of advanced services," says Tom Nolle, president of CIMI Corp., Voorhees, N.J. "While Sprint is the smallest of the three carriers, it has more to gain than lose-where with AT&T it's the other way around. AT&T has 60% of the leased-line market. Sprint only has 20%."

AT&T's interworking services and Sprint's expanded Sonet network and backbone architecture plans are some of the steps carriers have taken toward data network integration. MCI has also followed suit-but in a different fashion.

"Until March of this year, all of our data services were on separate platforms," says Stephen Von Rump, MCI's vice president of marketing for enterprise network solutions.

"MCI recently upgraded our Internet backbone from DS-3 to OC-3," Von Rump says. "We moved IP onto an ATM backbone for a specific tactical reason: to keep up with the network's growth." MCI exceeded the capacity on its Cisco 7500s, he says.

"We integrate some of that traffic burden onto the ATM switch. It's now five times faster than state-of-the-art IP packet routing," Von Rump adds.

MCI plans to use a similar architectural implementation to migrate other services-specifically data services-to an ATM backbone network. The carrier is still in the testing process, which will continue through the rest of this year, to determine which core ATM switch it will deploy for its full network integration plan. It plans to migrate its first data service onto an ATM backbone network in early 1997. Which services are deployed will be determined at a later date.

"It will depend on which services show the greatest need," Von Rump says. "In a likely scenario, IP will be moved first."

LDDS WorldCom, a smaller IXC, has already started construction of its ATM backbone to support its data services.

"We have been moving to an all-Sonet platform since 1992, with our capital focus on transport and Sonet equipment," says Larry Murphy, director of transmission engineering at LDDS WorldCom. The company is building its ATM backbone network using StrataCom's BPX ATM switches.

"We are in the process right now of moving our IPX frame relay users onto the BPX backbone, and the next step will be to migrate our Cascade [Communications] frame relay users onto the same network," Murphy says.

Although LDDS WorldCom has started migrating its frame relay networks onto an ATM backbone, some of its switched and private-line services will not be moved for several years, Murphy says.

Local ATM It would actually be easier for the Bell regional holding companies to integrate their data networks because it will not have to be on a national level, Nolle says.

Some of the Bell companies have, in fact, taken the first steps toward that goal. Nynex is already operating an integrated network that supports frame relay and managed private-line services over a high-bandwidth TDM backbone, says Bob Myers, director of business and product development for enterprise markets at Nynex.

The company will select an ATM backbone switch by the end of this quarter to replace the current TDM backbone. Like the IXCs, Nynex will migrate its data services onto the soon-to-be-selected switch. Nynex also plans to offer commercial ATM services by the end of the year, Myers says.

Bell Atlantic and BellSouth have also set their sights on integration. Although timelines and service goals differ from carrier to carrier, one theme holds true: ATM will be the glue that holds these data networks together. And even though the challenges are monumental, carriers are making the investments necessary to get the process under way.

"Carriers are very committed to ATM, but there aren't concrete plans on how to get from where they are today to where they are supposed to be in the future," Heckart says.

Because standards are still incomplete, some analysts and carriers are slightly skeptical about the long-term ramifications of data network integration. Despite this trepidation, the investments being made are real, and the economic outcomes are expected to make this monstrous task worth the risk.

Although the stakes are high, carriers are betting that their data network integration plans will bring high returns not only in financial gains but also in the form of simpler network administration and greater customer satisfaction.