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The Almighty Buck

Customer-owned Networks: ZapMail & Telecoms 233

Posted by Hemos
from the battle-in-the-making dept.
sasha writes "Here's a good article that describes how we, the consumers, can play the role of competitors to the vendors of products and services we buy. The author draws a parallel between FedEx's ZapMail failure and current situation with VoIP and WiFi in regard to the phone companies."
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Customer-owned Networks: ZapMail & Telecoms

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  • by Anonymous Coward on Wednesday January 08, 2003 @07:41PM (#5043622)
    "Those days are long over, as copper wires have been largely replaced by fiber optic cable."

    Tell that to the guys working at the thousands and thousands of wiring frames in telco central offices.
    • Depends on how you look at it.

      I don't know for sure, but I bet if you add up the total bandwidth and figure the percent run over fiber, the amount of fiber is use is huge.

      I know we have fiber coming into the worksite. Three of them...

      But then again, some statistics are meaningless...
    • There are a lot more important and used things then just regular POTS lines. Heck, just down the street from me they replaced a hunk of old copper with fiber. Sucks for anyone wanting to get DSL over there though.
    • My entire side of town was constructed with fiber to the last mile starting in 1991. Unfortunatley that means I cannot get DSL.

      Almost all new constuction in this area (Nashville, TN) is using fiber. The copper only starts at the little green box every few blocks.
  • by Kethinov (636034) on Wednesday January 08, 2003 @07:51PM (#5043681) Homepage Journal
    The problem with communications technologies is that there is a monopoly in the industry. Well perhaps not a monoply, but certainly an oligopy. How many phone companies can you name off the top of your head? 5? How about ISPs? Communications aren't advancing at the pace of technology because none of these capitalists want to give up their precious money.

    Perhaps that's why we don't have wireless internet access everywhere in the U.S. or why cars still run on non-renewable resources even though there are safe, clean, easy-to-produce alternatives. Companies which fill our cars with gas, provide us with barely stable internet access, and manufacture paper take advantage of public ignorance so much that "we are literally wiping our ass with our own future," as a great man once said.
    • They are a government regulated monopoly as long as they own 80% of homes and businesses in any given area. That was why Covad and other CLEC's failed. They still had to pay the bells.
    • Fuck wireless Internet. That's still a toy. There *has* been real progress. 5 years ago I had a shitty, expensive analog cell phone. Today, I have a cheap digital cell phone that provides excellent service across the country. That's called progress. Just because wireless Net isn't here yet doesn't mean there's no competition. There also aren't flying cars yet, but that doesn't mean that it's due to a lack of competition. Ever turn on a TV? See the hundreds and hundreds of cell phone ads? That's called c-o-m-p-e-t-i-t-i-o-n.
      • The wireless competition has been a good thing. Verizon just lost a residential customer because their wireless division is doing so well competing with the wireless telcos. The deal we got for our cells got us two new digital phones, free nights and weekends(including long distance), more time than we'll use for less money that we were paying on the old plan and for less money than our residential line plus long distance. With the increase in phone spam we were getting it will be refreshing to have cell phones as our primary residence phone.

        It is still illegal for telemarketers to call cell phones right?
      • Normal c-o-m-p-e-t-i-t-i-o-n drives innovation, as each company has to come up with the new thing to get people to buy it.

        5 years ago Japanese schoolgirls had cheap cellphones with more power than your cheap cell phone. It can hardly be called "progress" when we continue playing "keep up with the Joneses" so to speak.

        Recently the gap has been closing. But take a look at other countries' recent offerings (for links, just look through The Register archives).

        Part of the problem is the FCC restricting the features of broadcast. Part of the problem is phone companies not wanting to invest in changing. Part of the problem is that people either don't know or don't care about what they could be getting for their money.

        I'm the first to admit that I'm in that last group. I don't really like cellphones and when I am eventually forced to get one, I'll try to get the least whiz-bang model I can find because I don't care about all that extra jazz.
        • 5 years ago Japanese schoolgirls had cheap cellphones with more power than your cheap cell phone. It can hardly be called "progress" when we continue playing "keep up with the Joneses" so to speak.

          It's easier to implement infrastructure changes when the area you have to deal with is slightly smaller than California [cia.gov]. It's all those empty (sans people) miles of desert, mountain and farm land that hold back a lot of things because it's downright expensive to cover the whole of the U.S.

          You'll notice that you don't get digital cellular reception everywhere in the country - a whole bunch of places will drop back to analog - or just drop - once you get away from the Interstate highways. Take a look at the coverage maps for Verizon, AT&T and Sprint.

    • by LaissezFaire (582924) on Wednesday January 08, 2003 @08:26PM (#5043875) Journal
      As long as the government doesn't mandate or forbid things, we are rid of the monopolies. The definition of monopoly was originally based on whether or not the government allowed competition.

      The problems in the marketplace aren't "market failures" that the government needs to fix for you (at no small cost), but areas where the government has forced things to work a particular way.

      Entrepreneurs like to make money. And as long as they aren't forbidden to entera sector of the market, and it's profitable, they will. And it's the customers that vote with their pocketbooks that allow it to happen. It's a beautiful thing.

      • As long as the government doesn't mandate or forbid things, we are rid of the monopolies. The definition of monopoly was originally based on whether or not the government allowed competition.

        I don't think we are ever really rid of monopolies but I do agree that the government plays are large role in the regulation of monopolies. You should read the full history of AT&T. It's such a mixed bag. Here we have a government-regulated monopoly for most of the 20th century that essentially laid the last mile (i.e. the copper line), invented the transistor, invented UNIX, gave UNIX away (yay!), got busted into different companies, tried to take UNIX back (boo!), and is struggling to compete today. (If there's a RUN-ON sentence option for modding down...go for it. :) I'm left wondering what would have happened if AT&T had been broken up in the 1940s...would we be further along than we are now or even further behind?

        --K.
        • by gmack (197796) <gmack@@@innerfire...net> on Thursday January 09, 2003 @12:13AM (#5044951) Homepage Journal
          In Canada we take our monopolies and regulate the hell out of them. They get minimum service requirements or the customer gets to complain. They don't get to raise the basic services prices without going to the CRTC and justifying why.

          What do we have? An excellent phone system at a reasonable price and the land based telcos seem to be doing rather well for themselves finantialy.

          Regulation isn't the problem it's incompetant regulation. Had the US done what Canada did I'm sure it would have been much less of a burden on AT&T than what ended up happening. And you would probably have gotten better service out of it too.

        • Why didn't the government just own and regulate the last mile? This is a point I have never understood, and it seems that if it had been done, things would be so much simpler today.
      • Thank you, Ayn Rand. Now answer me this: If a single company (or organization of cooperating companies) gets powerful enough (one way or another) to squash all competition in its chosen market, how is that market any less "failed" than one where the government forbids all competition? In either case there is no competition, hence no innovation, and usually the customer ends up getting gouged.
  • by Rob Parkhill (1444) on Wednesday January 08, 2003 @07:53PM (#5043703) Homepage
    Damn, that doesn't rhyme at all...

    I see biggest stumbling block to be the complete lack of 911 service when using a VoIP service like Vontage. Sure, these systems are a pretty nice replacement for your long distance provider if you spend a lot on long distance, but don't fool yourself into thinking that this is a decent replacement for a local land-line just yet. You are better off using your wireless phone instead.

    I would hope that someday soon, VoIP systems like this and 911 would play nicely together, but I don't see that happening unless some three-letter governement agency steps in and mandates it.

    • I keep seeing people saying this as being a stumbling block to voip. I don't really understand though, is not having 911 that big of a deal? The town I grew up in didn't have it till the mid 90s and we managed to survive OK. Also, unless I am mistaken, 911 is typically linked to a regular local number. So you can just program that number into a speed dial function of your phone. While the 911 operator won't be able to pull up an address, the same is true of cell phones and I know plenty of people that have replaced their land lines with cells.

      • I keep seeing people saying this as being a stumbling block to voip. I don't really understand though, is not having 911 that big of a deal? The town I grew up in didn't have it till the mid 90s and we managed to survive OK. Also, unless I am mistaken, 911 is typically linked to a regular local number. So you can just program that number into a speed dial function of your phone. While the 911 operator won't be able to pull up an address, the same is true of cell phones and I know plenty of people that have replaced their land lines with cells.


        Why can't VoIP service operator give it's info to 911 same as the bell does?

        And BTW, the new cell phones are now getting the "E911" service, that will triangulate your signal if you dial 911.

        -Em
        • Residential 911 is relatively easy - the phone company installed your phone at your house and knows where it is, so they can program the 911 computer to know that the call from +1-202-456-2121 is from 1600 Pennsylvania Ave. Cellphone 911 is obviously hard - the phone can be almost anywhere, and the easiest thing the phone company can tell is that it's near the cell site it's using now; some digital cell phone standards can do a reasonable job of triangulation on distances to multiple cell towers to figure out locations. At least the wireless people have some clue.

          For VOIP, though, the way the phone call reaches the phone company is that somebody has a box that translates between phone lines (usually T1 trunks) and IP addresses, so the only thing the phone company knows is that it got a call from 202-456-2121, which terminates on a box in the basement at 1600 Pennsylvania Ave. PBXs already cause some trouble with this, but they're often bright enough to know that the call is from extension 1234, and somebody can run a database that knows that x1234 is on the 12th floor. With VOIP, it's even worse - the VOIP-to-POTS gateway is some router or PBX that knows it got a connection from 10.32.11.1, and it's possible that somebody has a database that shows that that address belongs to a DHCP server on the 12th floor, not that the 911-police know how to find your data network management staff in a hurry, but in most of the VOIP standards, there's really no information beyond the IP address.

          And of course your IP address might be anywhere in the world - did you dial in today from home, or a hotel, or an airplane, or your corporate office 3000 miles away? And think about the VOIP phones themselves - some people use telephone-oriented software applications on their PCs (it's 10.01.01.23 - do you know where your laptop is?), while other people use desktop VOIP phones from a variety of vendors, which you program to know that you're Linus Torvalds on +1-202-456-2121, and if you plug them in anywhere in your company's network, they'll find the gateway server, let it know your current IP address, and be ready to pick up your voicemail and incoming phone calls. Anywhere. So if you dial 911, the town your company's main office is in knows that there's an emergency somewhere near you, but it doesn't know where you are. And if you're not using a coporate VOIP system, you could really be almost anywhere. And if you're going through a NAT firewall or VPN gateway, you could be even farther anywhere.

          So what kinds of approaches can people take to fix this? The two obvious first steps are either to get the phone company out of the way (give the 911 people VOIP so they can at least try to traceroute you, though that still has all the IP-vs-location uncertainties), or else to make sure that the VOIP standards are updated to do a better job of passing location information (for people who want to pass it) and that the VOIP-to-POTS gateway standards provide some mechanism for passing that along, whether it's starting the call with a 300-baud beepstream or using a separate internet or modem channel to pass on the VOIP as packets rather than translating to audio. That's still not enough - your laptop or portable voip phone only knows what you've told it, and unless GPS becomes much much cheaper, lower electric power, and better at working inside, it's can't use GPS to find out for itself.

          Somebody could develop standards and implementations for some kind of where-am-I beacon, which probably would be better to run on a router but could be run on a PC, which you could program with your location, so a device can check with the net to get at least some advice about where it's located physically, though obviously that information could be misadministered or forged or just blinking 12:00. And if there's more than one of them that you can see, obviously you'd want some kind of decision-making process to find the closer one....

          Then there's the whole privacy issue. Usually if you're making a 911 call, you probably want the police to be able to find you. But not always, and you certainly wouldn't want them to be able to find you when you haven't asked....

          • "Somebody could develop standards and implementations for some kind of where-am-I beacon"

            Hello emergency? I live at xxx xxx xxx...

            People did that for 60+ years and it seemed to work okay.

          • or else to make sure that the VOIP standards are updated to do a better job of passing location information (for people who want to pass it)

            Actually, you hit the nail on the head there. It's not legal to block your phone number from 911 (or from toll-free numbers, because they're picking up the tab). If VOIP is to take off, the same standards need to be applied to it for residential telephone service.
            • If VOIP is to take off, the same standards need to be applied to it for residential telephone service.

              But isn't this exactly the opposite of the point of the article? The article even includes a quote that mirrors your statement:

              Telcos gain billions in service fees from [...] services like Call Forwarding and Call Waiting [...]. Hence, capex programs that shift a telco, say, from TDM to IP, as in a softswitch approach that might have less capital intensity, must absolutely preserve the revenue stream. [ http://www.proberesearch.com/alerts/refocusing.htm ]

              VoIP is fundamentally different than what we currently think of as a telephone. We shouldn't try to fit it into the same box.

              911 is one feature of telephones. It worked becaue a telephone was attached to a certain place. It improved emergency vehicle response time. Cell phones don't work well with 911, either, but emergency vehicle response time is far better now because when there is an accident there are usually people on the scene within seconds who can immediately contact 911 dispatch without having to find a friendly farmhouse, etc.

              VoIP will eventually do the same thing, but more so.

          • Of course, what we could do is simply turn back the clock to the mid-80s before 911 existed...

            Back then, police and fire departments had "normal" phone numbers, and had to make an effort to distribute magnets and paint the numbers onto their vehicles. It wasn't quite as easy to memorize as 911, but many phones with autodial came with 1-touch buttons labeled with police, fire, and medical symbols. (Then came the laws about not testing those one-touch buttons...)
          • The police can always find you when you call 911 from a regular phone. The database at the 911 call center displays your exact address at the instant the phone rings, regardless of whether you're unlisted or blocking caller ID.


            It's the same with cell phones, only less accurate of course. Some allow users to turn off the more advanced GPS-type features, so that the phone company isn't tracking them everywhere they go, but the feature will be reactivated automatically when they dial 911.

      • by Anonymous Coward
        The true worries are that:
        a.) the user of a "phone" can't be located (this is being solved using triangulation or GPS with cellular, but doing a network audit to find the ethernet port someone is plugged into doesn't make sense in the wireline world)
        and b.) The phone won't necessarily have power in an emergency situation. Today's phones (aside from cordless) are powered from the CO and hence a power outage in the customer premise doesn't cut off the customer calling for help.

        As well, Tell me how it makes sense for any more than say 5-10% of the population (really... what's broadband penetration at?)to go out and plunk down $40-50 US (us Canucks don't pay as much... :P ) then pay someone like Vonage (who serves relatively small pockets of the US thus far (at least if you want your number to be local...) another $40 smackers!

        Right.. if I'm grandma, uncle Ted, or mom&dad I'll stick with my $30 Baby Bell line...
        • Today's phones (aside from cordless) are powered from the CO and hence a power outage in the customer premise doesn't cut off the customer calling for help.

          I assume you meant cellular, not cordless. Cordless phones are the ones that are guaranteed not to work in a power outage, since the base station needs power to transmit to the phone.

          Tell me how it makes sense for any more than say 5-10% of the population (really... what's broadband penetration at?)to go out and plunk down $40-50 US (us Canucks don't pay as much... :P ) then pay someone like Vonage (who serves relatively small pockets of the US thus far (at least if you want your number to be local...) another $40 smackers!

          Right.. if I'm grandma, uncle Ted, or mom&dad I'll stick with my $30 Baby Bell line...


          $30 huh?

          When I actually used my landline, it was routinely $40-50 per month (including long distance, call waiting, etc... which are included in the $40 from Vonage). Currently, we pay around $85/month for our phone line... and $65 of that is "enhanced" DSL. That's $20/month for a phone that we spend more time talking to wrong numbers on than anything else. We'd probably do away with it entirely if my husband's cellular got better reception here. In my old apartment, I didn't even have a handset hooked up, and had the cheapest measured-rate service with no frills available from PacBell (which is cheaper than Verizon, the other big player in the LA residential market). I paid $53 and change per month, and the DSL portion was $39.95. (No, there was NO WAY to get DSL without getting phone service. And I didn't have a TV, so cable modem wouldn't have been cheaper.)

          So if I was in the habit of using a landline for my calls, I'd probably jump at $40/month including everything, as would a lot of people... if only to get rid of their phone company (some aren't bad, but some are atrocious).
          • (No, there was NO WAY to get DSL without getting phone service. And I didn't have a TV, so cable modem wouldn't have been cheaper.)

            This is the thing that irks me the most.

            Around here, in Dallas, cable modems are terrible. So the only real option for broadband is DSL. However, I hate having to pay for a landline telephone to get it.

            FCC should mandate offering DSL service without making the customer pay for landline telephone service. It shuts out VoIP.
            • FCC should mandate offering DSL service without making the customer pay for landline telephone service. It shuts out VoIP.

              Sure, it seems that way to the consumer. But what are the interests of the FCC? How do you demonstrate to them that DSL falls under their purvey, or more accurately, doesn't?

              That's what's been boggling my mind for the last couple years: how do you convince the FCC to (a) take an interest in and (b) take a position in favor of mandating the unbundling of DSL from POTS. Sure, *I* know of all kinds of reasons, and if we were dealing with the FTC it might be easier to argue it... but from a communications standpoint, given what the FCC is in charge of doing, how do we convince them?
      • 911 is designed to provide the following services:

        - A universal, easy to remember phone number that people can dial in any kind of emergency.
        - Quick forwarding of your crisis to the appropriate agency, whether it be fire, police, or paramedics, along with your location (even if you can't speak -- people have successfully used 911 to save their lives when choking, or when an armed intruder is present).
        - Operators trained to talk you through the situation, with first-aid instructions, advice on how to stay safe, or just sympathy and a calm presence.

        I can call the local police department, or fire department, or paramedics... but that's three numbers I need to know, for the area I'm in. If I'm at my friend's house and he keels over, I better hope he's looked them all up and has them clearly posted.
    • by stratjakt (596332) on Wednesday January 08, 2003 @08:46PM (#5043976) Journal
      I work writing/maintaining software for public service, including CAD (computer aided dispatching) systems. So I pretty much set up 911 systems from the police's end, and pretty much everywhere it's run at a municipal level. No 3-letter gov't agency need be involved, the 911 service is contracted between the city/county and the provider.

      So there's really nothing stopping a city from contracting an emergency service from a company like Vontage - all that needs happen is someone like me codes the interface to it.

      It is, however, unlikely. Agencies loathe change. They don't want to upgrade. Right now they're all pitching a fit because HP is phasing out the 3000 line over the next 10 years - they dont plan on buying new hardware before then. So I doubt we'd see any citys/counties signing a contract with a 'new kid on the block' .com company.

      Heck, my company is only 20 years old and it takes a lot of shmoozing (and vaporware promises from marketing that I have to keep - grr) to get in the door. They'd rather shell out the big dollars to a company like Motorola for vastly inferior software and support, because they know Motorola will be there in 30 years when they decide to upgrade the system.

      They're a decidedly technophobic bunch. You'd be surprised to see how many agencies in sizable cities still do their dispatching via cue cards and a bulletin board.
      • Can you blame them? (Score:5, Informative)

        by Goonie (8651) <robert DOT merkel AT benambra DOT org> on Wednesday January 08, 2003 @09:35PM (#5044214) Homepage
        If a new system has bugs, people can (and sometimes do) die. This tends to be a pretty powerful incentive to keep an old, working system going.

        We had this in Victoria (Australia) when ambulance dispatch was contracted out to Intergraph (who you may remember as a graphics card manufacturer). The inevitable teething problems occurred, a few people died, the government ended up in very hot water.

      • They're a decidedly technophobic bunch. You'd be surprised to see how many agencies in sizable cities still do their dispatching via cue cards and a bulletin board.

        Cue cards and bulletin boards never crash.

        (Well, maybe in a 7.1 earthquake. But one guy on each end can reboot a bulletin board in a couple seconds.)
    • As is coming with wireless phones, there's no reason GPS technology couldn't be employed to solve this problem. All that's needed is for someone to provide that service or software -- resolving GPS coordinates to addresses.
  • Nice article (Score:5, Insightful)

    by Uhh_Duh (125375) on Wednesday January 08, 2003 @07:56PM (#5043730) Homepage

    But it failed to point out that the big players in the telecom game are already well aware that their product (voice services via copper) are already obsolete. Why do you think the big boys (MCI, Sprint, Qwest) have such massive investments in the internet backbone? They recognize that the future of communications isn't land-line telephones, it's massive internet backbones. This is where every major player in the telecom game has banked their future. They're not idiots sitting in a smoke-filled conference room with no vision -- these people understand that their revenue stream on the internet side will ultimately replace their revenue stream on the consumer / voice side and they are already geared for it.

    The point is that switching to the internet backbone for your voice services doesn't hurt them -- it simply moves your service from column A to column B on their balance sheet.

    • ILECs vs LD carriers (Score:3, Informative)

      by cshirky (9913)
      Two points:

      First, the "big boys" you name are not the incumbent local exchanges, or ILECs, like SBC, BellSouth and Verizon. The article, written for the general reader, glosses over the difference between local and long-distance service, but its the ILECs who have the most to lose from Vonage et al, because the ILECs are the ones who make their money locking out competition and locking in service fees for things like Call Waiting that VoIP can do for free.

      Second, the move from Column A (per-minute fees on a voice-optimized network) to Column B (voice as just another flat-rate app on an IP-based data network) is more than just bookkeeping, because you get to charge a lot less for apps in Column B. If all of ATTs LD revenues were to switch to VoIP style pricing tomorrow, they'd be out of business by the weekend.

      -clay

  • by derfel (611157) on Wednesday January 08, 2003 @07:56PM (#5043732)
    Don't the phone companies already have pretty good control over internet access? Dial-up through the phone lines, DSL kind of goes through there too, and the cable companies are either phone companies or closely related to them. Once the phone companies lose the revenue stream from over charging us for phone access, they'll just charge us more for internet access. Well, I guess they'll do that either way.
    • The current situation in no way resembles the ZapNet case. Telcos welcomed the chance to charge long distance fees fax machines would generate and so allowed the connection to the existing network. They will not be so kind to Voice over IP (VoIP) and all other useful services people could run themselves. The laws are stacked against us.

      The existing telcos control accesss and they are being DEREGULATED. This would be fine if there were real competition, but there is not. "Servers" are already forbiden over cable networks - and the cable company is set to sell you phone service. Guess what, Voice over IP without paying the cable company will be obtaining service from a cable without permision and a federal offense. DSL? forget it, the local Bells have crused their competitors and also forbid "servers." The laws are against you - AOL/Time/McDonald/M$/USPO doesnt think they can get $250/month from every house in the country because the local public service commision is going to give it to them. They think they are going to get it because they have made it illegal for you to use the wires that enter your house as you please. Vontage will be screwed by all of this.

      802.11 meshes may offer a solution, but I fear the rainbow efforts of IBM and others. It won't take big companies long to convince the FCC to regulate the new wireless networks. The result will be most unAmerican - an artificailly limited electronic press which runs through shared property and the air itself.

    • Voip is to phone companies what word processors were to typewriter manufacturers.
      Basically VIOP means free calls to anywhere in the world.

      Intercontinental calls are often in the region of 60c PER MINUTE at present (call Africa from Europe if you dont believe me).

      With the threat of death hanging over them, are you surprised they won't deliver decent broad band?

  • by NineNine (235196) on Wednesday January 08, 2003 @08:00PM (#5043755)
    A. VOIP isn't that simple. Not yet. I can't buy anything at Wal-Mart and plug it into the wall. Until it's that easy, people won't do it.

    B. You need broadband. Broadband is far from ubiquitous, and will probably remain so for a good while until customers (such as myself) see a real need for it.

    C. My options now are to pay $50/month for broadband plus some amount for software and hardware, or pay $25/month for phone service plus $5 for a phone.

    D. VOIP is moot as cell phones are becoming increasingly better and cheaper. I can call anyone in the country from anywhere in the country as part of the minutes I buy every month. Why would I want to step backwards to be tied down to a land line (ie: Net connection)? I don't.
    • by davidstrauss (544062) <{david} {at} {davidstrauss.net}> on Wednesday January 08, 2003 @08:24PM (#5043866)
      A. VOIP isn't that simple. Not yet. I can't buy anything at Wal-Mart and plug it into the wall. Until it's that easy, people won't do it.
      I think this has potential as a feature in Wi-Fi routers: a broadband line + router + WiFi handset phone would at least not complicate the phone setup any more than broadband Internet setup.

      B. You need broadband. Broadband is far from ubiquitous, and will probably remain so for a good while until customers (such as myself) see a real need for it.
      Canada actually is implementing a universal broadband access plan.

      C. My options now are to pay $50/month for broadband plus some amount for software and hardware, or pay $25/month for phone service plus $5 for a phone.

      We actually pay around $50/month for metro phone service and another $40/month for broadband. Paying only one would be cheaper.

      D. VOIP is moot as cell phones are becoming increasingly better and cheaper. I can call anyone in the country from anywhere in the country as part of the minutes I buy every month. Why would I want to step backwards to be tied down to a land line (ie: Net connection)? I don't.
      As cell phones implement Internet features, VoIP will become a viable cell technology. Instead of running the cell Internet services over a small digital or analog pipe intended for voice, voice and data can share a large one.

      Granted, VoIP needs some work (i.e. 911), but don't sell it short for its potential.

    • Good points, and I've heard most of them when discussing VOIP with others. A few observations based on the linked article and the Vonage pages:
      a) You can plug any phone you want into the Cisco VOIP box. Many new homes are being built with CAT5 in every room, run to a single location called the "head end." Just put the VOIP box at the head end, then run it's voice side to whatever plug(s) in the house you want. Any wal-mart phone will work.
      b) True. Broadband is still expanding, though, and some of the maps I've seen (not sales drone maps, either) show that while square-mileage coverage is not up too high, population-density coverage is not doing too badly.
      c) Right now, though I pay $70 for DSL (static IP and extra bandwidth to webhost from home - toad.net rocks!), then $45 for phone, taxes, caller id (damn telemarketers), and 50 mins of long distance per month. I could drop that $115 to $95 with VOIP. I already pay for DSL and I'm not giving that up any time soon.
      d) I agree here. Some places are pretty spotty in the coverage department (much spottier than broadband sometimes), but the long distance and mobility of wireless phones are pretty unbeatable.
      I guess that with VOIP, like most other things, there's a market, and some folks will really benefit from it. Others won't...
      Cool technology, nonetheless!!!

    • A. VOIP isn't that simple. Not yet. I can't buy anything at Wal-Mart and plug it into the wall. Until it's that easy, people won't do it.


      From my understanding at least Vonage uses analog telephones which you can buy in Wal-Mart (and probably already have) which plug into a little cisco box which plugs into your DSL/Cable/Broadband connection (which I believe you can also buy in Wal-Mart).

      B. You need broadband. Broadband is far from ubiquitous, and will probably remain so for a good while until customers (such as myself) see a real need for it.


      True, but Broadband is growing fast. Heck, everyone I know and their grandmothers (literaly) are getting it. The real catch is that this only applies to non-DSL broadband, since most Bells force you to get a phone line to install DSL onto. I do not believe you can get DSL w/o paying for a phone line.


      C. My options now are to pay $50/month for broadband plus some amount for software and hardware, or pay $25/month for phone service plus $5 for a phone.


      So it may not be for you, but many people are already paying both. So since they already pay $50/mos for broadband, paying $25 to Bell vs paying $26 to Vonage is not that different, excpet they get A LOT more from the Vonage service for their buck like 500 minutes of LD and a few pennies per minute after, Voice Mail, remote access and most importantly complete number portability (ever move 10 blocks down the street and be forced to change your phone number by the bell? I have, it sucks!)


      D. VOIP is moot as cell phones are becoming increasingly better and cheaper. I can call anyone in the country from anywhere in the country as part of the minutes I buy every month. Why would I want to step backwards to be tied down to a land line (ie: Net connection)? I don't


      Valid point, but while land line is less and less usefull, it is still needed. Cell phone technology in US...well to put it delicately, it sucks. Every phone service I have tested had some issues here or there, dropped calls, dead zones, etc. Not a single service (tried TDMA, CDMA, GSM phones, etc) works reliably in my office which is in downtown San Francisco - not exactly middle of nowhere. That verizon dude from their ad is asking if anyone hears him for a reason - because half the time noone can!!! Sometimes I sound just like him. Once you move out of major cities most digital cell services just go dead. Still, I am way off topic. My point is that the modern land line is not competing with the cell service -its augmenting it. I want a land line so that I can get my messages for less personal calls that I do not want to be bothered with. I want my land line so that I can call my family and not pay 35 cents a minute as most cell services charge for overage. I want a land line so that my tivo and directv devices work. I want a land line for my fax machine. There are many reasons people want a land line.

      -Em

      BTW, I do not work for Vonage, I was just researching them to switch from my local Bell, because once again they ticked me off. So far I think their service is pretty amaizing and everyone I encountered who got the service said it was great.
      • by Sethb (9355) <bokelman@gmail.com> on Wednesday January 08, 2003 @08:55PM (#5044030) Homepage
        I've got Vonage, and it works pretty well, I'm literally days away from canceling my land line. My wife and I use our cells for most of our calls, but I didn't want to have to eat minutes for incoming calls, hence the Vonage line. I got in before they raised the price though, so my bill is only $20/month for 500 outgoing minutes, unlimited incoming.

        Anyhow, the only thing holding me back is my second TiVo upstairs, it wouldn't work over Vonage (though I read some people have gotten it to work) so I'm getting a wireless ethernet bridge to just send it via my 802.11b network. I should really wire the house with cat5e, but I'm lazy, and wireless is oh-so-easy.

        But, I use Vonage now all the time, no one has ever griped about the quality, and they'd never know I was using Voice over IP. Things have come a long ways since using Netmeeting on your 486. :)
      • I want my land line so that I can call my family and not pay 35 cents a minute as most cell services charge for overage.

        And yet, that's why cell phones are becoming more and more the staple rather than the extra: I called my best friend (who lives 500 miles away) and talked for an hour today. I pay $39.99+tax for my cell phone coverage, and it was included. I can call anywhere in the US, from anywhere in the US (that has cell coverage), and it's all rolled up into my 500 anytime + 3500 night/weekend minutes... which I've never come close to exceeding.

        If I want to call the pizza place down the street, sure, I'll pick up the landline. But if I want to call someone far away and talk for a while, the cell phone is far more economical.
  • by Daniel_Staal (609844) <DStaal@usa.net> on Wednesday January 08, 2003 @08:01PM (#5043760)
    I like his argument, mostly, but there is one flaw: He assumes the users have internet and will use it for Voice. But where do they get the internet access? The above would be fine, except I can't stand the terms of use for cable in my area (only one cable ISP.), and I have to have Voice (at least local) to get DSL. If I could get just DSL that would be fine, but there is no one who is offering it. So where do I get Internet in his scenario?
    • The article states:
      Given the choice, an increasing number of customers will simply bypass the phone company and buy the hardware necessary to acquire the service on their own.

      The phone companies have made sure that you dont have a choice. You must buy a voice line to get DSL, that is $20 to $40 a month each user is paying just to have the service to have access to DSL at a additional $40 an up cost per month. That is around $80 per household which has DSL, NICE CASH COW. Most terms of service forbid sharing your connection, therfore Legaly you cannot provide service which compeats with the telco.

      Until a non telco network (Wide spread interconnected WIFI network) can be built the telcos can bend the customer over and charge any fees they please. The customers have no choice in order to get service to connect to the internet

      .
  • by Chris_Stankowitz (612232) on Wednesday January 08, 2003 @08:02PM (#5043764)
    From the Article:

    "The creation of the fax network was the first time this happened, but it won't be the last. WiFi hubs and VoIP adapters allow the users to build out the edges of the network without needing to ask the phone companies for either help or permission. Thanks to the move from analog to digital networks, the telephone companies' most significant competition is now their customers, because if the customer can buy a simple device that makes wireless connectivity or IP phone calls possible, then anything the phone companies offer by way of competition is nothing more than the latest version of ZapMail. "

    The entire article makes a lot of assumptions most of which make no sense. But this paragraph being the most ridiculous IMO. There is a reason why products like Lindows is doin well. Mainly the majority of users on the internet don't know how/care to know how or want to do most of these things them selves to get online. This in no way compaers to zapmail. The alterantive was a very easy soloution and it was hardware only. Many people don't want to have to setup hardware and software to get a service. They want it commeing from the OEMs ready to go. The fax machine was a simple matter of pluging it into the wall. WiFi is all that simple (maybe to some). A horrible comparison and overall FUD aimed at Telcos that won't work.

    • by cshirky (9913) on Wednesday January 08, 2003 @09:25PM (#5044173) Homepage
      You're comapring apples and oranges. Don't think that today's Type 3 plain-paper "just plug it in and it works" fax was like the fax machines of 1984. Those fax machines costs thousands of dollars, had poor quality, were difficult to set up, and required lots of maintenance for their toner replacements and special fax-only paper.

      The reason we have easy to use cheap fax machines today is that there was a market for difficult expensive ones 15 years ago. The same thing happened with radios, calculators, and, of course, computers.

      Today's VoIP and WiFi installations are cheaper and easier than they used to be, and will be both cheaper and easier again by the end of this year. Comparing a mature technology with one still in early adoption phase, and concluding that the latter has no chance, is to mistake the acorn for the oak.

      -clay
  • by Anonymous Coward on Wednesday January 08, 2003 @08:03PM (#5043772)
    Zapmail failed because the users were able to sidestep the service provider (FedEx) by connecting directly to the network, for the cost of the fax machine. In essence, FedEx put themselves in as a middleman with zero added value.

    The author then states that wireless ISP's are making the same mistake, except that wireless ISP's aren't targeting the home users who can already get cable: They are targetting users where deploying a traditional wireless connect would be impossible, like rural areas, or rest areas where the users don't own the property where they want to use wireless internet.

    Also, he makes a similiar mistake with the traditional arguments about the value of VoIP.... except that the telephone monopolies most certainly offer a couple must-have value-added features, such as a centralized telephone number database and the handling of the last-mile wiring + service in one contract.

    ZipMail failed because they offered no value as a middleman. This argument doesn't apply to most wireless ISP's or telephone monopolies.

    • This isn't exactly true. I worked for FedEx back in the day (the '80s), and while ZapMail didn't last long as a service the machines themselves did remain in service for FedEx for a few years after that (or at least they hung around the office for a few years :) ).

      But I digress. ZapMail did have value as a middleman. It was just a service that customers really didn't need. ZapMail machines were more than just fax machines, they were really nice fax machines. These were document quality reproductions at a time when most users were wrestling with rolls of thermal paper. It was more of a document transfer rather than just a copy of the document. But hey, who needed it? People were happy with curling copies because they provided the needed information. Originals could wait a day. So there was value there, it just wasn't worth it (like auto detailing services...sure, there's value in them but not for me...)

      That's my take anyway...
  • by gpinzone (531794) on Wednesday January 08, 2003 @08:04PM (#5043778) Homepage Journal
    I don't disagree with the author's conclusions about ZapMail and the Fax machine. However, there's a key difference between telephone calls through your phone company and voice-over-ip: Internet providers are out to screw their customers as much as the phone companies. Take Optimum Online's self-imposed limit on uploads. They cite P2P traffic, but in reality, wouldn't this put the kabash on Voice-over-IP? Lo and behold, Cablevision is working on it's OWN voice-over-IP solution. Guess if you don't want to cable modem capped, you'll have to pay for TWO services. The difference between the two business plans is that the customers bought fax machines and made an "end-run" around Fed-Ex completely. Try to circumvent the telephone company by pumping VoIP packets through your IP and you may be in for a rude awakening.
  • Countries ban VoIP (Score:5, Interesting)

    by sapped (208174) <mstore1 AT yahoo DOT com> on Wednesday January 08, 2003 @08:04PM (#5043782)
    There are a number of countries (I can only think of South Africa as an example right now) that have banned VoIP and are forcing the ISPs to comply.

    This has been done purely to protect the phone companies. With enough lobbying that can happen anywhere.
    • In the UK there are ISPs that do not allow VoIP traffic. It's not legislated for, but it's still in the Terms of Service part of your contract with the ISP. The ISP is probably just honouring constraints forced upon them by the owner of the broadband network infrastructure between your house and the ISP, which is always a telco.
  • The big shift (Score:2, Insightful)

    by outofpaper (189404)
    The big shift es going to come as people start to learn that overlaping WiFi nets can work together. As more and more of the networks grow and conect people are not going to nead the last mile any more. With the advent of new WiFi tech people will have the option to get away from neading to use the telecos lines.
  • Static IPs (Score:4, Insightful)

    by Pinky (738) on Wednesday January 08, 2003 @08:07PM (#5043793) Homepage
    If you're going to call someone over the internet, you need a static ip.. Or a dyndns domain name to route. Your average household connection, right now, if dynamic ip. It makes finding people difficult.

    A second problem is the lack of deployment of high speed intenet... or maybe I should say, internet access that can be on 24/7 and not block the phone.

    Oddly enough, these problems are the ones that p2p and instant messaging systems tend to get around. INstant messaging will alert you when someone is there and p2p has so many users it doesn't matter who is on, someone always is. Look how well they did.

    I do find it funny that companies think users won't share internet accounts for multiple computers and will get two accounts. WiFi or not, I know no one with two i-net accounts for this purpose.
    • Your average household connection, right now, if dynamic ip. It makes finding people difficult.

      Why? I don't have problems finding friends on my instant messenger of choice.. I see a voip phone device as a device that connects to a network, and signs in to a service provider. That service provider will, through their means, allow you to talk to POTS phones from your VoIP phone. I don't think that your ip changing will matter, your phone "number" will be owned by them and they will facilitate the connection.
      • Re:Static IPs (Score:2, Informative)

        by Scyber (539694)
        I think he was refering to bypassing a VoIP service provider. The Cisco box used by vonage has the ability to connected directly to another cisco box (I believe you use the # as the dot in the IP address), thereby completely ignoring the service provider. For this you need a static IP.
    • Re:Static IPs (Score:2, Informative)

      by Lokni (531043)
      I have a dynamic IP address for my cable modem but it has not changed in over a year. My ISP (Time Warner) doles out IPs via MAC address. As long as your MAC address stays the same, you will get the same IP address each time.
    • Re:Static IPs (Score:3, Informative)

      by tomhudson (43916)
      So write a script that checks your ip every minute, and, if it changes, posts the changes. I did this yesterday so that we can run our web-based apps and check the webcams at the office, without either a static IP or dynadns service. It just uploads a new page with an updated link to our office server's ip.

      If anyone's interested, I'll post the details, or a howto. (You'll need a linux box and perl, 'natch! :-)

    • You don't need a static IP if you have a static phone number. Once Vonage gives you a phone number, it keeps that at the permanent entry in its db, matching your phone's dynamic IP to that phone number on the fly.

      This is the ICQ model, where the IP address is treated as the temporary half of a permanent->temporary lookup table. This is one of the big wins for this version of VoIP.

      -clay
  • by Bookwyrm (3535) on Wednesday January 08, 2003 @08:08PM (#5043798)
    While an interesting article, it would seem to imply that being able to use a FAX machine at, say, Kinko's should not be possible because people would just have bought their own FAX machines. For a business that sends many FAX machines, buying and maintaining their own FAX machine as opposed to using some one else's may make sense. For personal use, it may not be worth the investment. The article does not seem to take that sort of market segmentation into account.

    For example, if one assumes that if you use a phone service heavily and that you can provide it for yourself at a cheaper cost for bulk usage, you would. Businesses already do that for themselves with PBX systems (IP-based or not) -- in a sense, what the article is predicting has already happened, but only as far as the heavy users (i.e. businesses) are concerned.

    If one assumes the FAX analogy as gospel, then... nothing will really change. Kinko's and other places will provide FAX services to the consumers that cannot afford or are not interested in buying and operating a FAX machine for casual use. Saying that the next generation of VoIP (bah) products will cause people to stop buying services from the phone companies seems likely to follow the same pattern. For the services which are labelled 'too expensive'... how many people actually use those services? Frequently? Enough to justify the expenditure in setting up and running the services on their own? Maybe the services just aren't worth it, whether provided by the phone companies or by one's self -- perhaps that will be the common sense of the consumer, that maybe some of these 'services' offered by the phone companies, or the new next generation ones hyped by VoIP just aren't worth the money.
    • While an interesting article, it would seem to imply that being able to use a FAX machine at, say, Kinko's should not be possible because people would just have bought their own FAX machines. For a business that sends many FAX machines, buying and maintaining their own FAX machine as opposed to using some one else's may make sense. For personal use, it may not be worth the investment. The article does not seem to take that sort of market segmentation into account.

      Actually, I think the article was about that kind of market segmentation. What he was picking on ZapMail for, and using it as an example of, is providing a service that is much cheaper to provide at only a small discount over the old service. That means that the end-user finds the service to be even cheaper to provide for themselves.

      FedEx Standard Overnight for sending an envelope weighing .1 lbs from the West Coast to the East Coast is $16.48. Kinko's is $2.00 a page (maybe $3 by now) for the same thing, and it gets there about 20 hours earlier. (If I'm just sending it across town, it's only $11.59 by FedEx, and only $1.00 per page by Kinko's... or $0.75 gas money to take it there myself, if I have the time.)

      Kinko's is providing the service with a pricing scheme based on the assumption that, if you really thought it was worth it, you'd just buy a fax machine. FedEx wasn't taking that into account as an option; they were only looking at it in comparison to their own existing service, which was (and is) predominantly used by businesses. If they'd marketed it at cheaper rates to the general public, who knows? it might have taken off. But it wasn't the author who didn't realize that, it was the company.
  • by Dr_Marvin_Monroe (550052) on Wednesday January 08, 2003 @08:11PM (#5043807)
    I agree with the premise of the article, that the phone companies are viewing IP as a service rather than a medium....take the following quote from the article though:
    In classic ZapMail fashion, the telephone companies misunderstand the WiFi business. WiFi is a product, not a service, and they assume their competition is limited to other service companies. There are now half a dozen companies selling wireless access points; at the low end, Linksys sells a hundred dollar device for the home that connects to DSL or cable modems, provides wireless access, and has a built-in ethernet hub to boot. The industry has visions of the "2nd phone line" effect coming to data networking, where multi-computer households will have multiple accounts, but if customers can share a high-speed connection among several devices with a single product, the service business will never materialize.

    The problem here is how the companies have their service plans written. In most cases (except Speakeasy I believe), it's expressly forbidden to share your connection with anyone!...Call this an "anti-terrorism" move or just simple protection of their markets. Either way, they have legislated their own protection.

    If you have broadband, please examine your "acceptable use policy" for this type of language. With the pending handout to the phone companies (so that they can keep up with the Jones' over in the cable camp), I expect even further clamping of total bandwidth, types of bandwidth (i.e. peer-2-peer) and how you may use what's left.

    That's where FedEx didn't have control...If they could have gone to Washington with the idea that "FAX owners are possible terrorists," they could have blocked the individual ownership of FAX machines through legislation...and ZapMail might be all we know now! FedEx also didn't have control of what the public can attach to their phone circuits....the phone company does have some level of control over that.

    Simply put, the phone companies are in a much stronger position to protect their markets with anti-competitive language and policies. I don't expect them to "go easily into that good night." I expect that there will be quite a struggle coming up....expect all the legal manuvers, engineered incompatabilities and FUD that we've seen from the RIAA/MPAA and more.....They didn't get to be monopolies by being nice, they'll do whatever it takes to maintain that position.
    • The problem here is how the companies have their service plans written. In most cases (except Speakeasy I believe), it's expressly forbidden to share your connection with anyone!..

      But this is a silly requirement that the customers will. If the cable companies take action there will be quite an outcry...

    • WTF are you talking about? First, the ISPs didn't legislate anything - the restriction is in the contract you signed. Second, they prohibit sharing your line with people OUTSIDE your household, not with multiple devices. Third, what the hell does terrorism, the RIAA and the MPAA have to do with telephone service?

      How about you read your post before posting it next time? It makes no sense whatsoever.
  • missing a point (Score:5, Insightful)

    by Styros (144779) on Wednesday January 08, 2003 @08:13PM (#5043813)
    The problem that faced Zapmail doesn't translate here. Zapmail failed because Fed Ex didn't own the underlying technology behind it, the telephone wires. Fed Ex had to buy the technology, the line and the fax machine, just like its customers. That's why the pricing never made sense, since nobody would pay the Fed Ex premium when they could go directly to the source.

    That analogy doesn't work here, because the telcos own the underlying technology. Once they bundle phone and internet together, you have both no matter what. Sure, you can cancel the phone, but why, you've already paid for it.

    Take my case for example, I can only get SBC DSL here. I don't like SBC's phone service, so I want to quit. Well, that's too bad for me, because I can't. In order for my DSL to work, I have to have SBC phone service. Since, I can't get a cable modem, I'm stuck with the service.
    • I didn't want to make the article too much of a trip down memory lane about ZapMail, but in fact FedEx _did_ own the underlying technology. They built a proprietary data network to support the service. It was the owners of fax machines who didn't own the underlying technology.

      And the bundling of DSL and phone doesn't keep you from keeping the phone for POTS/911 service and moving everything else to VoIP. Unless you have the bare minimum phone service and no LD charges, this may well be a cost-saving option.

      -clay
  • by persaud (304710) on Wednesday January 08, 2003 @08:19PM (#5043839)
    At a US Dept. of Energy 08/02 workshop on High Performance Network Planning, Bill St. Arnaud gave a presentation on CA*Net4, the Canadian optical research network where "... Universities and researchers own and control their own lightpath wavelengths and _associated cross connects on each switch_."

    Topology:
    • a network of point-to-point "condominium" wavelengths
    • condo owners can recursively partition their wavelengths
    • wavelength owners determine topology and routing of their light paths
    • massive edge peering, "star bursts" vs. "ring of rings"
    • not "distributed network objects", but "distributed object networks"
    Customer oriented end-to-end model:
    • customer owns infrastructure, carrier provides network management
    • asset-based telecom allows customers to fund and control the network
    • customer controls the bandwidth
    Details:
  • by Newer Guy (520108) on Wednesday January 08, 2003 @08:39PM (#5043941)
    For now, someone (telco, cable company, etc.) owns the 'last mile' of the circuit. My ISP tells me that about 2/3 of my monthly DSL bill goes direct to the ILEC (telco). They get 1/3 to fill the line with Internet. That means that they get 17 bucks a month out of the 50 and the telco gets 34 just for providing the last mile. To add insult to injury, to get ADSL I must also have an analog telephone line, (at 20 bucks a month) which means that the telco actually gets paid TWICE for the last mile.

    It seems to me that the telco's are committing highway robbery. They're getting over 50 bucks a month for providing a single copper pair about five blocks. Cable's pricing is no better, and all the cable companies are capping upload limits which limits your ability to use VOIP (the reason is clear here too; cable wants to charge you for THEIR OWN VOIP).

    Seems to me that a community could make a small fortune by running fiber and charging even half what the telco's and cable companies charge for that last mile.

    Finally, I have Vonage VOIP service. Had it for over a year now and I love it. I use it with DSL.
    My wife talks to her mother over 10 hours a week. I call all my friends and my kids constantly. The bill is always the same: 39.99 plus tax. Also, their international calls sound better then AT&T and you can't beat calling most of Europe for 5 cents a minute. Plus it's great having a 617 (downtown Boston) incoming phone number that is a local call for all my friends there, yet rings at my condo in Los Angeles.
    • Such stuff is great for middle-to-large sized city dwellers. I am rural folk near a small-sized city in Indiana. There is NO broadband in my area except for satellite. Think DSL is overpriced given that the phone company is essentially charging twice for the same line with a truly cheap extra addon to make DSL work? Try satellite. It costs more for satellite than for DSL or cable, but since most rural USA residents have no option BUT satellite if they want broadband...


      I have been mulling over the possibilities of shoving it up the telcos (and cable company's arse) by becoming an end-run ISP. I want broadband CHEAPER than anyone else offers it and I would like to offer it to neighbors/my local community for cheaper than telcos or cable or satellite. Problem is, being a rural area, the potential customers are dispersed over a wide area and not necessarily up there on the economic scale. Farmers and manufacturing types. I want to completely sidestep the telco and install a T1 and then offer access to the community at a little over cost (to bring an income to me and help me maintain/upgrade service, etc). Unfortunately, I just don't see a large enough real customer base here to really make it feasible. Thus, we out here are stuck indefinitely with telcos and dialup internet. There is no competition and no drive to spread broadband to the people. You have to move to Canada or Europe to see a real drive to offer broadband to the citizenry.

  • by silentbozo (542534) on Wednesday January 08, 2003 @08:41PM (#5043948) Journal
    It looks like the Vonage boxes have the direct dial number tied to the box. It's like a mobile phone in that respect, except the boxes hook onto a public infrastructure (TCP/IP), which means you can pay $40 to Vonage to have a phone number in the 310 area code (Los Angeles), even though you might physically be in some place like China (assuming you have broadband there.)

    You could put together a DIY call center on the cheap - get a business number, have it set to forward to a set of 310 numbers, get a dozen Vonage boxes, put them in some place where labor and broadband are cheap (someplace in midwest Canada?), and there ya go! Local customer calls 310 number, local teleco forwards to the Vonage number, Vonage rings the box, which is NOT in LA, and there ya go!

    Hmmm, even cooler. Take the box with you on vacation - as long as you can get TCP/IP, you won't have to mess with phone or message forwarding. Damn, this is one way to have a portable number, even if the local telco won't let you have one (even though by state law they're supposed to!!!)
    • Anyone know if it is possible to call a Vonage box without going through Vonage? I don't mean call on a regular telephone and connect to the Vonage box, I mean call from a generic non-Vonage MTA to a Vonage-labled MTA. I'm envisoning a system where one person gets a Vonage MTA, and you put wi-fi extensions off of it (like a party line) and share that TCP/IP to regular POTS tunnel with an entire neighborhood (in the same way you would share broadband access.) People within the neighborhood would call each other for free, without each having to pay to subscribe to Vonage. If the MTA supported it, you might even be able to program one number, but have it forward to different extensions - a way of getting business service, without having to pay business prices.
    • ...this is one way to have a portable number...

      It's a shame that someone can't invent some sort of mobile telephone device... whereby you take a small telephone and use "radio waves" or somesuch to connect to other phones.. erm. heh. :)
  • This article is great, and I'm going to show it to my boss as a way of explaining a product that we are being offered by a company called NorVergence [norvergence.com], which taps into your PBX and routs calls over there network, instead of the TDM network.

    Now, for my question... has anyone ever delt with NorVergence? My web searches have turned up mostly just press releases, I can't find any "customer reviews", positive or negative. If we sign up for their service, what can we expect?

  • I'm sure I'll have inaccuracies in this also.

    Alot of people are saying that this just isn't possible. Some don't like cable and others say you have to get voice with DSL.

    The article, however, was a kind of "What may happen in the future/What is happening now" not a "This is what is happening here and now and here's what we can do."

    VoIP is a very real possibility, just not yet. In the future, we will be able to get DSL sans Voice. You have to look at this from the 'as the world turns' way instead of the 'status quo' way. If broadband was inexpensive(they way it is moving to, believe it or not!) and you can go to Wal Mart, buy a "VoIP/WiFi Starter Box" which gives you a wireless hub and a WiFi phone with a charging station, I believe VoIP would become much more popular than regular telephone.

    If you think that the phone companies keeping an incompatability between VoIP and 'land lines'(VoIP disguised as regular phones) then you're wrong. Many people will switch to both. I don't believe that E-Mail will replace the phone (although it would be nice =). Instant Messaging is used as much or sometimes more than the telephone, so it is a real competitor, same with e-mail vs. IM. I do not believe that Instant Messaging will replace E-Mail, nor Telephone. Nor do I believe that MSN Messenger or Yahoo! Pager will replace AIM. Those are easy choices to make whereas Telephone is not.

    Internet Service is poised to move to be the 'hard choice' because you can always unplug the VoIP or turn off AIM. I think the traditional phone services will be replaced by online directories for looking up people, calculating their current IP(back-end stuff, end-users won't see this), and show whether they are at home or not.
  • A few FedEx details (Score:5, Informative)

    by Anonymous Coward on Wednesday January 08, 2003 @09:19PM (#5044142)
    While the article makes some reasonable points about the ZapMail / personal fax machine 'competition' as usual there are a few details that fill out the picture (and maybe make it a little more interesting).

    - FedEx's 'fax machines' were 300x300dpi devices. This was important because a signed document could be sent that would still contain a legal signature. Keep a 1986 perspective on this (with very few fax machines anywhere during planning much less laser printer quality)

    - A communications satellite was part of the network (so much for not owning the network as some have said). Problem is, it was on the Challenger. Not only was the satellite lost, so was the launch system for an indefinite period.

    - The tax laws were scheduled to change in 1988 (?) to change that would reduce how much FedEx could write off in the case of a project cancellation. With no launch capability, it probably was reasonable to shutdown sooner rather than later and get the best writeoff possible.

    - Lots of Tandem systems were purchased to support Zapmail. Most of these are still in operation in the FedEx network. Also, for a long time Zapmail hardware was used internally as copy machines... (oh, that old thing - its a Zapmail leftover...)

    - FedEx hired a lot of IT people around the Zapmail time (mid 80's) and many are the old hands of today. By the way, FedEx laid off ZERO personnel when Zapmail was cancelled even though reported from 1500 to 2500 were involved. All were reassigned and a large number played significant IT roles later in the evolution of the FedEx network to what it is now. Many even referred to themselves as being 'Zapmailers'.

    If a few things had gone differently, the project might of at least been launched and operational for a while. There's little doubt that the Zapmailers did not understand how much the common fax machine would spread, but what would have been launched would still be in its own 'league' even now.
    • I had the honor and the horror of being a minor peon in The Great ZapMail Experiment and would like to add some additional details. It is obvious to me Clay Shirky was wandering in darkness on his ZapMail analogy.

      Briefly put:

      1) The price of a emergent fax machines was too steep for small businesses. The prices dropped amazingly in the next four years. (In retrospect, you young'un's would say it was too slow.)

      2) Faxes in 1984 were crappy as hell and most all used thermal paper with a very short lifespan. Uncle Fred was bringing 415 dpi (not 300) to the world on crisp heavy bond paper. Hot damn!

      3) There actually was a discussion in 1983 about faxes being unacceptable to most trial judges in legal proceedings. (i.e. they would only allow 'real' original documents to be used in court.) Uncle Fred hoped that FedEx would be able to convince the legal community that ZapMail was absolutely, positively as good as the original and tamper proof. I don't know what specific game plan Uncle Fred had in mind, but he was a visionary when it came to ARM (Analog Rights Management). Of course, once any Tom, Dick, or Harry could get their hands on a fax machine, the stigma of duplicated documents instantly disappeared.

      After 1988 I was fortunate enough to get a few lasers and a handful of DRAM from a friendly FedEx engineer, which I subsequently lost... I've been feeling bad about that for a while now.

      However, because of this article I have discovered that you can buy ZapMail print engines online! [printerworks.com] Damn, I love the internet!

  • by MrByte420 (554317) on Wednesday January 08, 2003 @09:19PM (#5044147) Journal
    Consumers need to take the lead much like these other systems and create a new email system which will coexist with the current but have features that the consumers of the future are going to want. We need Email2. This invisioned system would be secure in that email addresses would be prevented from being forged (or else not delivered if they were), encryption would be built in. (Think every Email2 server could sign the outgoing message with a public/private key and then there could be a DNS-like system to manage looking up, caching and using these public keys to verify mail was sent by the server that was listed) Email addresses could be publicly accessible yet prevent junk. None of these things are out of the realm of possibilities of current technology - its a resistance from those companies that have built there entire infrastructure on the status quo that prevents us from migrating to the enevitable: email as it is will not be here to stay. Its time for consumers to take the lead and replace the current delopogated email system we currenlty have tacked together and create something new. Industry is not going to do something about the spam problem - its we the consumers that need to give up on our monopoly-sponsered email system and create something that serves our needs rather than theirs.
  • by TooTrueTroubs (630665) on Wednesday January 08, 2003 @09:27PM (#5044177)
    This kind of model is simpler to see in action in Australia. Unlike the US, we only have 2 major landline-phone companies for the entire country, plus a multitude of cell-phone companies and ISPs.

    The traditional telco, Telstra (still largely government owned), has hugely inflated prices for lesser services. The rival upstart company, Optus is usually more cost effective.

    Optus is offering Voice-on-Cable for around $35AUD - approximately $17US - and throwing in 100 calls a month free. Now that's not quite following the service model proposed by the article, but it's close, and damn cheap.

    You can get cable internet services + voice-on-cable for a combined fee of around $75AUD a month.

    This is Optus's main strength - it's converging most of the major communications services into a single package - cable internet, cable TV and cable voice, at a price-point that is, if not cheap, then at least reasonable.
  • by SiliconEntity (448450) on Wednesday January 08, 2003 @09:44PM (#5044248)
    Jane Black wrote an article making a similar analysis in BusinessWeek Online [zdnet.com] a few weeks ago. She discussed commercial WiFi companies like Cometa and brought up the example of FedEx's ZapMail to illustrate that commercial WiFi could face the same failure. Some quotes:

    When fax machines were first introduced in the 1980s, several big companies planned new fax-delivery services. In 1984, visionary FedEx CEO Frederick Smith introduced a service called ZapMail that he hoped would replace jet fuel with ink toner. The plan: FedEx would buy the then-pricey fax machines and place them in every FedEx office. Customers who wanted to send a fax would have FedEx pick up their documents and bring them to a local office. Within the hour, the documents would then be faxed to the FedEx office closest to the recipient. FedEx would put the fax in an envelope and hand-deliver the service.

    At the time, it made sense. ZapMail began as a value-added service that leveraged FedEx's core strength--reliably delivering information overnight. It also saved customers the trouble of installing and maintaining expensive equipment. But ZapMail ultimately failed as the price of fax machines plummeted. Rather than pay someone else to send a fax, businesses just bought their own machines. FedEx shuttered ZapMail only 12 months after the launch--and $190 million in losses.

    ZapMail may prove a cautionary tale for Cometa. Right now, Wi-Fi seems like a new, whiz-bang technology that requires corporate oversight. But in time, business users and individuals may not see the need to pay someone for Wi-Fi service. After all, bandwidth is sold at a flat monthly rate. That means there's no cost difference to a hotel, restaurant, or public park if 1,000 or 100,000 people log on to their network.

    "This is a corporate land grab. Ultimately, though, users may realize they can make this work on their own," predicts Dewayne Hendricks, CEO of the California-based Dandin Group, which promotes wireless technology in remote areas. That would be good news for Wi-Fi. But bad news for Cometa.

    Let's give Ms. Black credit for coming up with the ZapMail analogy first. Shirky may have thought of it on his own, or he may have borrowed consciously or unconsciously from this earlier article.

  • I don't know where most of the posters get their information, but we amateur radio operators (hams) have been doing VoIP for quite a while, over dialup and without static IPs - and we talk anywhere in the world to any other connected user. Check out http://www.eqso.org and http://www.synergenics.com for excellent software.
  • by core plexus (599119) on Wednesday January 08, 2003 @09:50PM (#5044273) Homepage
    That's what my telephone and DSL are, member owned cooperatives. We are always fending off buy-out offers from nearby commercial-corporate phone companies, but it won't happen. Our electric company is also a member-owned cooperative. I got a check from the phone company last week, my share of the dividend. I wouldn't have it any other way.

    Over-exposed schoolgirl victim of high-tech bullying [xnewswire.com] See what trouble camera cell-phones can be?

  • by sterno (16320) on Wednesday January 08, 2003 @09:58PM (#5044318) Homepage
    This article seems to not appreciate one minor issue. Most people get their Internet from either the cable company or the phone company. Whether you attach a wifi access point at the end and use VoIP to call people, you still have to pay them to get your Internet service.

    Now, let's think about this...

    Your local phone company charges you say $30/month for phone service. It then charges you $50/month for internet service. You get some VoIP setup and you end up paying them only $50/month instead of the $80 you would have been paying if you also had to get your phone through them. Or perhaps you get your service through a CLEC and you pay your CLEC $50, and now your phone company is only making even less on you (possibly less than they were on the original phone service).

    Ultimately this suggests that the phone companies are going to end up charging higher fees for their Internet service in order to make up for the shortfall in local phone service.

    Now, let's look at your cable company because they face similar problems. Why would I pay them $50/month for TV, and $50/month for internet, when I can just buy the Internet and get TV programming off the Internet? So they end up paying for a bunch of infrastructure and risk making the same amount they've been making. AT&T has tried to bundle VoIP phone service into their cable systems, but why would you buy it from them as opposed to anybody else?

  • The article mentions both VoIP and Internet routers like the home Linksys devices. However, devices like the Linksys use NAT to share the connection amoung several computers/devices. VoIP and H.323 just doesn't work with NAT. The writer flat out states that all one needs to do to use VoIP is plug the ATA into the Hub/router, but that just ain't so.
    • That's why Linksys offers the EtherFast® Cable/DSL Voice Router [linksys.com]

      The Linksys EtherFast® Cable/DSL Voice Router is the perfect solution for connecting a small group of PCs to a high-speed broadband Internet connection or a 10/100 Ethernet backbone--and it features Voice Over IP telephone calls powered by Net2Phone. With the EtherFast® Cable/DSL Voice Router installed, no other special hardware is necessary for telephone calls. An ordinary telephone connects to the RJ-11 port (telephone jack) on the back of the EtherFast® Cable/DSL Voice Router, and calls are routed by Net2Phone's superior quality network to anywhere in the world--significantly reducing long distance charges.

      Unfortunately, it appears you are locked into Net2Phone as your provider. Anyone have one of these?
  • by Ironica (124657) <pixelNO@SPAMboondock.org> on Thursday January 09, 2003 @01:16AM (#5045180) Journal
    Interesting article overall, but I have to nitpick:
    They are selling us a kind of ZapPhone service, where they've digitized their entire network up to the last mile, but are still charging the high and confusing rates established when the network was analog.

    Well, no, they're not. I remember when I was a child, we'd sit there and wait until the phone ticked one minute past 5:00, then we'd call the family in Oklahoma. The amount you saved by calling "after the rates went down" was significant enough that in most residences, you didn't make long-distance calls during business hours unless it was an emergency.

    I thought it was just my mom having grown up poor and all that, but then a couple years ago I had occasion to see the comparative per-minute rates from The Phone Company(tm) vs. Now. Then it all made sense. (Wish I could remember where I saw it so I could cite it.)

    Since the company has been split up, and has switched over to digital signaling, our costs have gone down significantly. When you factor in cost-of-living changes, I believe that even the value-added services (like call waiting, voicemail, etc.) are significantly cheaper than they were a decade ago.
    The average music lover was willing, even eager, to give up driving to the mall to buy high quality but expensive CDs, once Napster made it possible to download lower quality but free music.

    Or so the RIAA would have you believe, but no one's yet demonstrated that P2P networking ever replaced any purchasing activity.
    Voice over IP doesn't sound as good as a regular phone call, and everyone knows it. But like [MP3] music, people don't want the best voice quality they can get no matter what the cost, they want a minimum threshold of quality, after which they will choose phone service based on an overall mix of features.

    I think the author missed a really good bet when he made this comparison. After all, cell phones are the really, really obvious example of how people don't care quite so much about voice quality in a telephone call. We're willing to say "What? What was that? Can you hear me now?" many times in a conversation if it means we can take our phones with us everywhere and play games on them when we're bored. Losing a little quality to have cheaper, more flexible "landline" service is a no-brainer.
  • by herrd0kt0r (585718) on Thursday January 09, 2003 @03:39AM (#5045624)
    who's to say that voip necessarily means that it's limited to standard telco quality? why not pump up the bandwidth and slap the CPU around by compressing mp3 on the fly? imagine:

    - phone conversations that make it sound like the other person was RIGHT THERE!
    - you can hold the phone up to the radio and uh. something like. uh. easy shoutcasting!
    - superior phone sex!
    - etc.

    no, really. i'm serious. regular telephone sound quality sucks rocks. market it smart, and make people believe they NEED better sound quality from their phone conversations! sucker them in!

    ah, yes. another technology driven by pr0n.
  • by taaminator (185731) on Thursday January 09, 2003 @09:47AM (#5046596)
    Zapmail was more than a fax, Zapmail was acceptable for legal purposes.

    In 1984, I successfullly used Zapmail to send a check that needed to be in hand in NOW.

    In 2003, next time you're at a commercial operation, ask them if they will accept a faxed check.

    Zapmail was more than a fax, Zapmail was a dream come true which nothing has replaced.

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