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NXTComm 2008 Las Vegas, NV NXTcomm is a trade show for the telecommunications industry that is jointly owned by TIA (Telecommunications Industry Association) and USTelecom(formerly co-owners of SUPERCOMM). It has never lived up to the promise of the former SUPERCOMM, which was a massive event. This year it appears to struggle with smaller exhibition space and fewer attendees. The telecommunications industry is no longer the huge monolith based on providing phone service. The keynotes reflected the major changes in the industry. However, the AT&T presentation was the most backward looking. AT&T Randall Stephenson, CEO of AT&T gave a follow-up keynote to the message he provided last year at NXTcomm shortly after becoming CEO. Stephenson said that AT&T and others in the telecom industry “are in the business of velocity, providing commercial velocity. And, connectivity is and always has been the foundation for velocity and commercial growth.” “The railroads connected hundreds of once-distant cities.” “The one thing that has provided more connectivity than anything is the advent of the telephone.” "With that, suddenly distance doesn't matter anymore." “3 billion people could be connected to the Internet worldwide by 2011, and that there are already more than 1 billion devices connected to AT&T’s network today.” “When you mobilize something, usage explodes.” This point led to the Sony’s invention of the Walkman and the impact it had on records. Stephenson pulled an iPhone 3G from his pocket and showed it. "It's a perfect example of how innovation continues to accelerate," "We're doing things with technology today that would have been hard to imagine a few years ago," "Our devices will get smaller and smarter, and user interfaces will become more intuitive. No one in this room can predict what the future will bring." "Mobility accelerates voice, voice minutes are growing on the AT&T network at 10 percent annually. Wireless data across our network is growing by 400 percent a year." When you combine telephone, mobility, streaming video and the Internet, things get really exciting.” "As we connect more things and mobilize, we stimulate economic growth, and that drives prosperity." Stephenson cited data from the London School of Economics that found that for every 10 new mobile phones per 100 people, a country's Gross Domestic Product increases by 10 percent. He added that 80 percent of the world's population currently lives within range of a cellular network. "Our business at AT&T is simple: We connect people to their world, and we do it on their terms," Stephenson said. "Today, conservatively, more than 1 billion devices are connected to the AT&T network." Stephenson noted that the telecom industry is sitting on a world of potential, but to unlock it, vendors need to manage growing complexity in the ecosystem that has been developed. Every new product involves a lot of players. “We’re in the very early stages of massive changes in how people work and learn.” It was noted that HD is now being offered over copper around the globe. Online commerce through companies like amazon.com, eBay and Craigslist now is a $136 billion business. There was a reference to the Cisco TelePresence product and how powerful this is connecting individuals. It could have big impacts on travel savings. There was an example of how the mobile phone has revolutionized the way Indian fishermen do business when they bring fish into market from the day’s catch. "It took a whole lot of companies to bring our IPTV platform to market," "The same thing with the iPhone -- it took a lot of vendors to design and support it and now with the 3GiPhone, the ecosystem is even bigger." Stephenson warned the audience that opportunity is fleeting in the telecom business and there is no time for missed deadlines or products. "These are exciting times to be in this business," Stephenson said. "We're on the verge of an innovation explosion." What was missing? This was a top level talk about the strategic role which communications plays and little reference to the role of AT&T. Noticeably absent was any reference to: AT&T’s plans to provide service to homes at 100Mb/s – the current hot bandwidth. Tiered based pricing which has the effect of reducing available bandwidth and what are AT&Ts plans. U-verse – which is AT&T’s triple play service. The Long Term Evolution (LTE) buildout on 700MHz spectrum AT&T won in the recent AT&T auction. Any mention of network openness. Verizon Denny Strigl, President and Chief Operating Officer of Verizon provided specifics on some of the actions that Verizon is taking. Verizon plans to expand the availability of its FiOS Internet service. Next week it will begin offering download speeds up to 50 megabits per second, to 10 million homes and small businesses throughout its 16-state territory, widening it beyond its availability in six states. "The Verizon network is delivering broadband speeds that are unmatched by any competitor," Verizon plans to make FiOS available in more than 18 million homes by 2010. The 50-Mbps service will cost customers $139.95 a month with an annual contract. Verizon plans to increase the basic and middle-tier connection speeds as well. "Our plan is to cover all of the 3.1 million households in all five boroughs in the next five to six years, We will start this year as soon as we receive the approval of the New York Public Service Commission, which we expect will be next month." "We've already had trials of the 100-megabit home, which will be a reality faster than anybody thinks," he said. "We're also pushing the envelope on the speed of the Internet backbone -- with 40-gigabit-per-second speeds a reality today and 100 gigabits in sight. "We think that giving customers the tools to manage their digital lives -- anytime, anywhere, on any device -- may be the most powerful growth opportunity of all," Strigl said. Strigl stated that America leads the world in the number of broadband connections and in choice and competition for broadband services. It was noted that Verizon's fiber-optic deployment is progressing faster, passing twice as many homes with more fiber customers than exist in all of Europe. Strigl countered arguments that the U.S. lags other countries in broadband. "We have more broadband connections than anyone else, at more than 100 million and counting. More than half of all households in this country have some form of broadband service." It was commented that a study that ranked the U.S. 15th out of 30 countries in broadband ignored wireless broadband services as well as the geographic differences between the U.S. and other countries. Massachusetts and New Jersey have the same population density as South Korea or Japan and about the same broadband penetration, he said. In wireless, too, the U.S. is leading other countries, with more minutes, lower prices and more choice of providers. "What the U.S. communications industry has achieved in deploying broadband and mobile networks is tremendous, unlike most other nations, we've done this not through industrial policy but through private investment. Our industry has grown, delivering innovation that makes a difference in the lives of our customers. The benefits have rippled through the entire economy and up and down the whole supply chain -- creating millions of high-tech jobs and billions of dollars in value.” "'More' is what our industry is delivering to customers and America." More' is what Verizon is going to bring to the marketplace this year, next year and every year after that. And 'more' is what broadband and mobile technologies will mean to society as we enter the next phase of the digital revolution." What was missing? Any mention of network openness. Potential for Net Neutrality mandates or the introduction of tiered pricing Sprint Nextel Dan Hesse, Sprint President and CEO provided an expansive view of the role he seeks his company to play in wireless and, in particular, with WiMax. WiMax service provider Clearwire, will go commercial in Washington, D.C., and Chicago later this year. Sprint estimates will deliver 2M bps (bits per second) to 4M bps to each user. Hesse stated that the WiMax service will be an open service on which customers will be able to use any safe application or platform. However, some network control and management by the carrier is necessary, he said, calling regulation of how carriers control their networks a bad idea. The Samsung Instinct handset, an iPhone-like device will hit the market Friday. It will be available first to Sprint's current customers. "One competitor has announced a new 3G device. But keep in mind that the 3G coverage could be relatively small, so the user experience could be disappointing to many.” Sprint had an edge over rivals in developing WiMax. It is expected that WiMax blanket entire cities with Web access for laptops, cell phones and other consumer devices at fast speeds. "WiMAX and 4G is wireless at rocket speeds," he said. "We believe we could have a two year head start over the competition in true wireless broadband ... at landline type speeds." The role of Sprint with utility companies and automobile manufacturers was cited. Cars could soon let parents download "backseat movies" for their kids, while utility companies could get rid of the thousands of meter readers who go house-to-house collecting natural gas and electricity usage data. My cityactually uses such a wireless system for reporting on water usage, but its short range and requires a city-operated van to drive the streets, collecting readings. The ability for such devices to connect to the "cell phone" network (we'll need to stop calling it that) could make such solutions even cheaper to implement in the long run. Hesse cited that AT&T's 3G data service could be poor and claimed that Sprint has a two-year head start on the competition in rolling out a 4G network. "Wireless freedom is essential for a fresh flow of new ideas, new innovations, and new investment. No walled gardens." "We will keep WiMAX open," he reiterated, but openness still has its limits. Hesse won't allow the "greed, malfeasance, or irresponsibility" of the few to affect the service of the many, so network management tools will be used. But apart from that proviso, Sprint claims to favor a totally open system, and it has shown its commitment by joining the Open Handset Alliance and the Open Patent Alliance. What was missing? How Sprint Nextel will stop losing money. Sun Microsystems Scott McNealy, Chairman and Co-founder, Sun Microsystems gave his view of the role of the open in the network and computing. It was announced that version 6.3 of the company’s MySQL Cluster product for the telecommunications carriers would be released. Sun has been a pioneer in the open networking movement. The company has made a commitment to make all of its products available for free on the Internet. Almost 2 million copies of Sun’s Open Office productivity suite are downloaded a week. “Free is a good business model; just ask Google,” he said. “But my employees won’t work for free, they’re coin-operated.” Expanding on the idea of openness, McNealy said interoperability is a big deal and it can’t be stopped. “Why would you want to run all the applications on the Internet that are Java, when you could change your picture from here to here,” he said, pretending he was turning an iPhone. “I’ve been trying to run over my wife’s iPhone all week.” “The beauty of open source is you have the planet — all of mankind — helping you,” he added, mentioning that 1,700 companies are helping to make Java better. What was missing? What is the relevance of what was said to the telecommunications industry, other than the MySQL announcement? DigitalBridge Communications DigitalBridge is provide broadband data services using WiMax with 2.4GHz spectrum in underserved communities in Idaho, Montana, Wyoming, South Dakota, Indiana and Virginia. The company claims that 14 markets are currently deployed with many more in plans, It claims it is cash flow positive in each of the communities it enters in 6 – 12 months and frequently shorter. The first market entry cash flow positive was achieved in 6 months and the second market in 3 months. The focus is on self install and done in 3 minutes. There is no truck roll. Currently the service is to the home for 90% of the installations and only 10% to businesses. An expansion is into mobile data but not mobile voice, until the WiMax issues here are resolved. The size of communities supported vary from 150,000 to as small as 10,000. One key to the service is low cost fiber back haul, which is frequently done with companies holding dark fiber. Minerva Seeks to Provide TV Applications with XML Minerva Networks provides STB client software for use on IPTV networks. Some of the applications include: EPG, web access, PVR, Pay-per-View, and caller ID. In its presentation it was proposing that its service management platform could be used to bridge the gape between IPTV services and the web with XML as the abstraction layer. The value of XML is that it will enable ready port of Internet applications to the TV platform. Examples were shown of “t-commerce” over the television. Another value of XML is the support of Widgets. The value comes from the platform Minerva is proposing is the ability to integrate TV and the web. This is quite close to the concepts behind Tru2Way. The difference is that Tru2Way is across the whole cable infrastructure not just one supplier of software for the STBs. Further, Tru2Way does not have an implicit bridge between the Internet and the television service. PON Evolves to Support Higher Data Rates There is a bandwidth race on. Verizon made an announcement yesterday of taking its top tier to 50Mb/s. Cable has begun limited rollout of DOCSIS which can be 130MB/s based on channel bonding. Here at NXTcomm there was much discussion on PON, Passive Optical Networks, and how this technology is evolving to support higher data rates. Background on Verizon 50Mb/s Announcement and DOCSIS 3.0 Verizon intends to offer over the entire service region the 50Mb/s downstream and 5Mb/s upstream service by 2010. This includes 16 states and 10m homes passed. The 50Mb/s service will cost $139.95 a month with an annual contract. In the medium tier, Verizon upped the speed from 15 Mb/s downstream and 2 Mb/s upstream to 20/5 Mb/s. Comcast will offer DOCSIS 3.0 service in the Minnesota's Twin Cities region, with plans to expand to its entire service region by 2010. It is planned to offer DOCSIS 3.0 to 20% of the Comcast subscribers by 2008. It is expected that the initial offerings being in the 20-50Mb/s range. To get the full benefit of DOCSIS channel bonding is required and this not expected until 2009. The pricing in the Twin Cities region is $149.95 a month for residential and small to medium-sized businesses can get the increased speeds for $199.95 a month. The bandwidth race is increasingly become competitive but only in restricted geographic areas where both are available. The landscape should develop by the end of 2010 when widespread deployments are in place. PON Performance At NXTcomm a number of presenters described the current state of PON technology and other developments to improve fiber deployment. We discuss these in the aggregate rather than the individual talks. The 3 standards below are based on the ITU G.98X APON was ATM based and did not support video broadcast and thus in limited deployment. BPON transport is based on ATM but it has a overlap RF broadcast band at 1500 nm for video. This is in use by Verizon. It was also introduced in Japan in September 2002. GPON has the option of ATM, Ethernet and TDM transport but most systems are using Ethernet. GPON is the use of WDM to increase bandwidth There are 2 standards under the IEEE 802.3ah. GE-PON is Ethernet only and uses an Auxiliary lambda for broadcast. The date rate is 1Gb/s symmetrical. Commercial GPON is Ethernet based and broadcasts on 1550nm. It supports 2.488 Gb/s downstream and 1.2Gb/s upstream. P2P – there is a effort in the IEEE standards to consider a Peer-to-Peer standard. EPON is to support 10Mb/s on one wavelength. Once the fiber reaches the home distribution is usually accomplished via HPNA or MoCA. There are a number of challenges with WDM-PON or GPON. These include: The combination of access and the metro ring into one network. It is unclear what is the best way to accomplish this. SARDANA in Europe is a consortium seeking to address this. In spite of the advantages of GPON it is seen as the most expensive implementation compared to the other PON standards. As component costs decline this will become the most viable technology to accomplish 10Gb/s. Cable also has a fiber infrastructure and the key parameter is how deep the fiber extends to the home. Typically the optical transmitter supports 500 – 1000 homes while with PON this is 32 homes. Thus, fiber appears to have a long term advantage over cable, but cable to decrease the node count as it seeks to complete with telco fiber. It is frequently asked – why push to 100Mb/s. The response has been – to support 4 HD streams into the home for independent viewing in various rooms. A comment made on the advantage of fiber – there is lower latency compared to ADLS and cable. This is a significant advantage for gamers playing on=line games. WAVE Comments At NXTcomm DigitalBridge Communications gave a compelling presentation that WiMAX is a very good solution for Internet access in rural communities as low as 10,000. It remains to be seen if WiMAX will become a 3rd competitor for Internet access across the US. Certainly it will not compete in the bandwidth race but in the geographic access WiMAX has significant potential to fulfill the anywhere promise of broadband access. There is a clear discriminator between telco fixed broadband and cable. Cable has jumped on the open bandwagon, or at least the quasi-open. At NXTcomm, Minerva gave a presentation on how to bring Web interfaces and functionality to television delivered over broadband using XML. This has a close parallel with Tru2Way but the Minerva solution is proprietary while Tru2Way is mandated over the cable systems and plant. The perception is that the telecos cannot afford to open their systems given the high levels of investment to lay fiber. It remains to be seen how long the telecos will remain a closed application environment, given the competition with cable and WiMAX. Increased bandwidth is driven largely to support multiple HD video streams to the home. However, it is only a matter of time before P2P video, and specifically video communications between individuals, becomes an important broadband application. TelePresence, as a form of video conferencing, is beginning to show important market presence on the enterprise side. In the home, similar levels of quality has the potential to make video much more valuable in the home from security to extended family interactions.
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